504.831 General standards for directors.
1. Each member of the board of directors of a corporation, when discharging the duties of a director, shall act in conformity with all of the following:
a. In good faith.
b. In a manner the director reasonably believes to be in the best interests of the corporation.
2. The members of the board of directors or a committee of the board, when becoming informed in connection with their decision-making functions or when devoting attention to their oversight functions, shall discharge their duties with the care that a person in a like position would reasonably believe appropriate under similar circumstances.
2A. In discharging board or committee duties, a director shall disclose, or cause to be disclosed, to the other board or committee members information which the director knows is not already known by them but is known by the director to be material to the discharge of their decision-making or oversight functions, except that disclosure is not required to the extent that the director reasonably believes that doing so would violate a duty imposed under law, a legally enforceable obligation of confidentiality, or a professional ethics rule.
3. In discharging board or committee duties, a director who does not have knowledge that makes reliance unwarranted is entitled to rely on the performance by any of the persons specified in subsection 5, paragraph “a”, to whom the board may have delegated, formally or informally by course of conduct, the authority or duty to perform one or more of the board’s functions that are delegable under applicable law.
4. In discharging board or committee duties, a director who does not have knowledge that makes reliance unwarranted is entitled to rely on information, opinions, reports, or statements, including financial statements and other financial data, if prepared or presented by any of the persons specified in subsection 5.
5. A director is entitled to rely, in accordance with subsection 3 or 4, on any of the following:
a. One or more officers or employees of the corporation whom the director reasonably believes to be reliable and competent in the functions performed or the information, opinions, reports, or statements provided by the officer or employee.
b. Legal counsel, public accountants, or other persons as to matters involving skills or expertise the director reasonably believes are either of the following:
(1) Matters within the particular person’s professional or expert competence.
(2) Matters as to which the particular person merits confidence.
c. A committee of the board or advisory committee of which the director is not a member, as to matters within the committee’s or advisory committee’s jurisdiction, if the director reasonably believes the committee or advisory committee merits confidence.
d. In the case of religious corporations, religious authorities and ministers, priests, rabbis, or other persons whose position or duties in the religious organization the director believes justify reliance and confidence and whom the director believes to be reliable and competent in the matters presented.
6. A director shall not be deemed to be a trustee with respect to the corporation or with respect to any property held or administered by the corporation, including without limit, property that may be subject to restrictions imposed by the donor or transferor of such property.
2004 Acts, ch 1049, §90, 192; 2007 Acts, ch 15, §1; 2012 Acts, ch 1049, §11; 2015 Acts, ch 45, §9
Referred to in §347.13, 504.826, 504.835