Regarding the duties and authority of the Board of Directors in a Company, it is stated in Article 1 point 5 of the Company Law, as follows:
“The Board of Directors is an organ of the Company that is authorized and fully responsible for the management of the Company for the interests of the Company, in accordance with the purposes and objectives of the Company and represents the Company, both inside and outside the court in accordance with the provisions of the articles of association.”
Meanwhile, the duties and authorities of the Board of Commissioners are stated in Article 1 point 6 of the Company Law, as follows:
“The Board of Commissioners is the Company’s Organ in charge of supervising generally and/or specifically in accordance with the articles of association and advise to the Board of Directors.”
In relation to fiduciary duties in a Limited Liability Company, the Board of Directors and the Board of Commissioners are organs that have duties and responsibilities to carry out day-to-day management of the Company for the benefit of the Company. In terms of duties and the Board of Directors has been regulated in Article 92 paragraph (1) of the Company Law, namely to carry out the management of the Company for the benefit of the Company in accordance with the purposes and objectives of the Company. Meanwhile, specifically for the Board of Commissioners is regulated in Article 108 paragraph (1) of the Company Law, which is responsible for supervising management policies, the course of management in general, both regarding the Company and the Company’s business, and providing advice to the Board of Directors.
Regarding the legal doctrine of fiduciary duty, can refer to the book of M. Yahya Harahap’s book entitled “Limited Liability Company Law”, p.; 374 as follows:
“….each member of the Board of Directors shall carry out the management of the Company. Obligations performing must also be done in “good faith” (te goeder trouw, good faith). The meaning of good faith in the context of the implementation of the management of the Company by membersDirection in legal practice and doctrine, has a wide range, including as follows.
1) Fiduciary duty;
Each member of the Board of Directors “must be trusted” in carrying out their responsibilities; management of the Company. This means that each member of the Board of Directors is forever “trustworthy” (must always bona fide) and must always be “honest”.”
Article 97 paragraph (2) of the Company Law states that each member of the Board of Directors must be in good faith and full of responsibility to carry out duties for the interests and business of the company. Article 108 Paragraph (1) of the Company Law also states that the Board of Commissioners is responsible for the supervision of a Company.
Basically, the Board of Directors and Board of Commissioners have fiduciary duties towards the Company and not towards shareholders. However, it is an exception if the shareholder is appointed to the Board of Directors or Commissioners through the General Meeting of Shareholders.
One example of breach of duty of trust (fiduciary duty) can refer to the District Court Decision Number 439/Pdt.G/2011/PN.JKT.SEL. jo. Jakarta High Court Decision Number 533/PDT/2013/PT DKI jo. Case Decision Number 1005 K/Pdt/2016.
Where Defendants I, II, III were former members of the Board of Directors of the Plaintiff (Company) who issued the Company Guarantee without the approval of the Board of Commissioners. In its ruling, it stated that Defendant I, Defendant II, and Defendant III had jointly violated the Plaintiff’s Articles of Association and breached the Duty of Trust (fiduciary duty) as Directors. Therefore, Defendants I, II, III are fully and personally liable and jointly and severally responsible for all legal consequences arising in connection with the issuance of the corporate guarantee issued in favor of Defendant I and Defendant II.
“Considering that point 2 of the petition requests the court to state that the first defendant, second defendant and third defendant have jointly violated the articles of association; basis of the plaintiff and violated the fiduciary duty as Directors, by because the defendants in the issuance of the linsen company guarantee or guarantee nelson company in a ship charter agreement with co-defendants I and co-defendant II without the approval of the board of commissioners, then for the act The defendants were deemed to have violated the plaintiff’s articles of association and duties trust as the Board of Directors, so therefore the petitum is appropriate for granted.”
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Legal Basis:
Law Number 40 of 2007 concerning Limited Liability Companies as amended by Government Regulation in Lieu of Law Number 2 of 2022 concerning Job Creation
Verdict:
Decision Number 1005 K/Pdt/2016
Decision Number 439 Pdt.G/2011/PN.JKT.SEL
Jakarta High Court Decision Number 533/PDT/2013/PT DKI
Reference;
Simanjuntak, Cornelius dan Natalie Mulia. 2009. Organ of Limited Liability Company. Jakarta: Sinar Grafika,
Harahap, M. Yahya. 2011. Limited Liability Company Law; Jakarta: Sinar Grafika.