Board responsibilities and duties
We advise directors of Swiss companies limited by shares on management, organisation, care and supervisory duties. We support legal assessment of responsibilities, conflicts and crises, and evaluation of personal liability risks.
Overall management and organisation
Non-delegable duties particularly include overall management, organisation and establishing accounting, financial control and necessary financial planning. The board appoints and supervises executive management and fulfils further statutory duties. A passive mandate without actual performance of these duties is risky.
Delegable tasks may be transferred under statutory conditions and suitable organisational rules. Selection, instruction and supervision remain essential. Minutes should clearly record decision foundations, conflicts and dissenting votes.
Care, loyalty and conflicts of interest
Directors must perform their duties diligently and safeguard the company's interests in good faith. A member nominated by a shareholder is not exclusively bound to that shareholder's interests. Equal treatment of shareholders and handling of confidential information must be observed.
Conflicts must be disclosed and addressed through appropriate measures. For related-party transactions, commercial appropriateness and independent decision-making are particularly important. Consent from individual shareholders does not replace examination of mandatory rules.
Financial crisis and personal risks
Threatened insolvency, capital loss and over-indebtedness trigger different duties. Liquidity must be monitored continuously; necessary restructuring steps, interim accounts, audit and possible court notification must not be postponed merely in hope of new financing.
Breaches may trigger civil liability and further risks. D&O insurance, discharge and mandate agreements do not provide comprehensive protection. Resignation ends the future role but does not remove possible responsibility for earlier conduct.
Frequently asked questions
Which tasks may the board not delegate?
Statutorily non-delegable and inalienable duties in particular remain with the board. These include overall management, organisation, central financial organisation and ultimate supervision. Delegation of executive management does not replace these responsibilities.
Is relying on executive management sufficient?
No. Reports must be appropriate, reliable and critically reviewed. Warning signs require additional investigation. The intensity of supervision depends partly on the business, risks and specific situation.
To whom does a shareholder-appointed director owe duties?
They must safeguard the company's interests in good faith. Instructions from the appointing shareholder do not justify breaches. Conflicts and disclosure of confidential information must be handled carefully.
What should be done about a conflict of interest?
The conflict must be fully disclosed in time. The board must take appropriate measures, such as recusal or independent assessment. Which measure suffices depends on the transaction and specific conflict.
Must bankruptcy be filed immediately in financial difficulty?
Not every liquidity shortage means over-indebtedness. Statutory crisis situations and their respective measures must be examined separately. However, required court notification must not be delayed without permissible grounds.
Does D&O insurance protect me against every liability?
Insured persons, exclusions, policy limits, deductibles and notification deadlines determine cover. Intentional conduct and other cases may be excluded. A policy does not replace diligent performance of the mandate.
Complex questions from practice
Under what conditions may the board refrain from notifying the court of over-indebtedness?
Statutory exceptions require careful examination. Sufficient subordinations or a justified prospect of timely remedy without additional creditor risk may be relevant. Mere financing intentions or non-binding promises are not sufficient decision foundations.
Audited interim accounts, deadlines and realistic restructuring assumptions must be documented clearly. Financial developments require ongoing monitoring. A one-off positive assessment does not relieve directors from reassessing changed circumstances and taking necessary steps.
How should a risky business decision be documented to reduce liability and evidential risks?
An adequate information base, examined alternatives and a transparent risk assessment are essential. Conflicts must also be identified and appropriately handled. Minutes prepared afterwards do not replace a diligent decision-making process.
Document foundations, discussions and reasons promptly. They should show which options were weighed and why the chosen solution served the company. Good documentation facilitates later assessment but does not automatically exclude officer liability.
How must loans to majority shareholders be assessed during a corporate crisis?
Loans to related persons require independent assessment even during a crisis. Company interests, market terms, repayment capacity and capital protection are central. Consent by the benefiting shareholder or group instructions do not legitimise an unlawful asset transfer.
Conflicts require appropriate independent measures and reliable documentation. Review liquidity effects, security and repayment prospects before payment. Financial distress additionally requires consideration of statutory monitoring and creditor-protection duties.
Does resigning from the board shortly before bankruptcy remove earlier liability risks?
Resignation does not remove earlier breaches or their consequences. Existing urgent duties do not disappear merely through a resignation letter. Responsibility during the term and how resignation was actually implemented are decisive.
Service, commercial register entry and orderly handover should be verifiable. Outstanding crisis issues and documents must be passed on appropriately. Resignation may change the future role but does not replace examination of possible claims arising from earlier decisions or omissions.