kaal:claim:5583610-032

Using LER to secure say-on-pay support falls within Delaware's business judgment rule, which presumes good faith board decisions absent self-dealing or gross negligence.

Source quote, verbatim

LER in executive compensation aligns with Delaware's business judgment rule, which presumes that boards act in good faith unless self-dealing or gross negligence is evident, as upheld in Aronson v. Lewis.

From

Wulf A. Kaal, Liquid Equity Rewards in Corporate America (2025), 7.4. Executive Compensation and Alignment, p. 29
https://ssrn.com/abstract=5583610 · source PDF

Cite as

Wulf A. Kaal, Liquid Equity Rewards in Corporate America (2025). SSRN: https://ssrn.com/abstract=5583610

Holds when

executive compensation votes
no self-dealing or gross negligence

Classification

conditionsupport: arguedcorporate-governance

Related claims

specializes kaal:claim:1558614-006 Although the business judgment rule is articulated differently in the two countries and German law leaves some...

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