The Balancing Act: Directors' Duties In Canada vs. The U.S.

When evaluating major corporate decisions, such as potential merger-and-acquisition opportunities, a corporation's board of directors is tasked with exercising its management or supervisory role with a view to the best interests of the corporation. Interpretation of what or who makes up "the corporation", however, and particularly which stakeholder interests may be validly considered when making corporate decisions, varies between jurisdictions.

In the United States, this notion of a director's duty is generally interpreted to be synonymous with the best interests of the corporation and its shareholders and, particularly, shareholder value is to be prioritized. In Canada, on the other hand, the notion is not as wedded to maximizing shareholder value, as a director may properly take into account the interests of shareholders, as well as other stakeholders such as employees, creditors, consumers, the environment and the community at large in determining the best