{
 "@context": "https://schema.org",
 "@type": "DefinedTerm",
 "@id": "https://wulfkaal.github.io/entities/duty-of-loyalty",
 "identifier": "kaal:entity:duty-of-loyalty",
 "name": "Duty of loyalty",
 "termCode": "duty-of-loyalty",
 "inDefinedTermSet": {
  "@id": "https://wulfkaal.github.io/entities/index.json"
 },
 "author": {
  "@type": "Person",
  "name": "Wulf A. Kaal",
  "identifier": "https://orcid.org/0000-0003-0757-275X"
 },
 "dateModified": "2026-07-29",
 "canonicalForm": "https://wulfkaal.github.io/entities/duty-of-loyalty.md",
 "sha256": "d449ba5ab802a958961bdbbc11cc294a5f60bb21ee97ac6519d2bd8a956c0088",
 "additionalProperty": [
  {
   "@type": "PropertyValue",
   "name": "status",
   "value": "derived"
  },
  {
   "@type": "PropertyValue",
   "name": "claim_count",
   "value": 2
  },
  {
   "@type": "PropertyValue",
   "name": "work_count",
   "value": 2
  },
  {
   "@type": "PropertyValue",
   "name": "year_span",
   "value": [
    "2010",
    "2025"
   ]
  },
  {
   "@type": "PropertyValue",
   "name": "non_current_claims",
   "value": 0
  }
 ],
 "subjectOf": [
  {
   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/1558614-019",
   "identifier": "kaal:claim:1558614-019",
   "text": "Because the Aufsichtsrat owes its duty of loyalty to the firm rather than to shareholders alone, and because non shareholder constituencies such as employees and creditors are more risk averse than diversified shareholders, German supervisory boards may take a more conservative attitude toward risk than U.S. shareholder oriented boards.",
   "abstract": "The Aufsichtsrat's legal duty of loyalty to the firm as distinct from its shareholders thus may dictate a more conservative attitude toward risk than that of a shareholder oriented board of di- rectors in the United States.",
   "citation": "Painter and Kaal, Initial Reflections on an Evolving Standard Constraints on Risk Taking by Directors and Officers in (2010). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1558614",
   "datePublished": "2010",
   "claim_type": "mechanism",
   "confidence": "argued",
   "is_failure_mode": false,
   "scope_conditions": [
    "German courts treat the duty as protecting the interests of the firm, not only shareholders",
    "reinforced by codetermination"
   ],
   "source_pdf_sha256": "e898211630f4116879329d6de8397523dca5b066864147421aa5cbc7429dc83b",
   "status": "current"
  },
  {
   "@type": "Claim",
   "@id": "https://wulfkaal.github.io/claims/5583610-014",
   "identifier": "kaal:claim:5583610-014",
   "text": "Issuing LER selectively to management-aligned shareholders while excluding others breaches the duty of loyalty by creating an uneven playing field, so rewards must be allocated uniformly on objective criteria such as ownership tenure.",
   "abstract": "Therefore, LER voucher rewards cannot be issued selectively to shareholders who are aligned with management while excluding others. LER allocations to prioritize incumbent interests would constitute a breach by creating an uneven playing field.",
   "citation": "Wulf A. Kaal, Liquid Equity Rewards in Corporate America (2025). SSRN: https://ssrn.com/abstract=5583610",
   "datePublished": "2025",
   "claim_type": "failure",
   "confidence": "argued",
   "is_failure_mode": true,
   "scope_conditions": [
    "proxy fights",
    "duty of loyalty analysis under Delaware law"
   ],
   "source_pdf_sha256": "2d73609d95ddb1573acc2a9e7af617fbe6283d6e591deb6317f6d5d804517c62",
   "status": "current"
  }
 ],
 "description": "2 claims in the published works of Wulf A. Kaal carry the concept tag 'duty-of-loyalty'. Derived node: a roster, not an adjudicated definition."
}