Corporate secretary as subject of fiduciary duties
The article is devoted to the analysis of the legal status of the corporate secretary through the prism of the duties of the latter as a subject of fiduciary duties. It is emphasized that clarifying this issue is important because it depends on: 1) the possibility, and most importantly, the legality of terminating his powers without substantiating the grounds for such dismissal and on grounds not covered by Art. 36 of the Code of Labor Laws of Ukraine; 2) the possibility/impossibility of holding him accountable for actions that go beyond disciplinary, administrative or criminal offences.
It is emphasized that, at the legislative level, the fiduciary duties of officials stem from the need to act: 1) in the interests of the company and within the scope of authority; 2) in such a way that, in his good faith belief, will contribute to the achievement of: a) the purpose of the company’s activity; b) successful results of the company’s activities for the benefit of all its shareholders as a whole, for which he must take into account: the possible consequences of his decisions in the long term; interests of company employees.
The legal nature of fiduciary duties is analyzed. It is justified that although the corporate secretary is not directly related to the management bodies of the joint-stock company, the nature of his competence determines the special legal position of the corporate secretary. A fiduciary duty exists where one person, the owner, places a special hope or trust in and relies on another person, the fiduciary, while the fiduciary acts in his own discretion using his own experience.
The author concludes that the corporate secretary is subject to fiduciary duties, as he implements on behalf of the company the latter’s duty to provide shareholders with information about the company; the corporate secretary is subject to the rules regarding the prohibition of competition (conflict of interests) and is obliged to act in the best interests of the company; is the bearer of the company’s confidential information.