A Comparative Overview of Director Duties and Liability: Bolivia and the United States

Corporate governance is central to transparency, accountability, and value creation in a global economy. Directors play a key role in guiding policy, protecting shareholders, and upholding institutional integrity. While diligent fulfillment of fiduciary duties fosters trust and sound business practices, governance failures can lead to scandals and investor skepticism.

This article compares fiduciary duties and director liability in Bolivia and the United States—jurisdictions shaped by civil law and common-law traditions, respectively. Focusing on the sociedad anónima (“S.A.”) and U.S. corporations (especially under Delaware law and the Model Business Corporation Act (“MBCA”)), this article examines statutory foundations, fiduciary responsibilities, and enforcement mechanisms. The analysis herein unfolds across legal frameworks, fiduciary duties, comparative liability, and reform-oriented conclusions.

General Legal Framework: Bolivia Versus United States

Bolivia

Bolivia operates under a civil law system based on Roman legal traditions, emphasizing codified statutes and structured legal regulation.

Constitutional Provisions

Bolivia’s constitution^[1] guarantees economic freedom (Article 47(1)) and protects business association rights (Article 52(I)). It ensures legal recognition and democratic governance of business organizations (Article 52(II)).

Commercial Code

The Bolivian Commercial Code^[2] regulates the legal relationships arising from commercial activity (Article 1). It broadly defines commercial activity, applying the term to both acts and actors (e.g., merchants, entities).^[3] Business entities (sociedades comerciales) are formed via partnerships for profit or shared risk (Article 125).

The Commercial Code establishes the types^[4] of business entities governed by the commercial code. For purposes of this article, we will focus on one specific type, the S.A., due to its similarity to the U.S. corporation.

Additional Legislation

Additional legislation includes ASFI Resolution No. 722/2012^[5] and RA/AEMP Resolution No. 099/2016^[6] (amended by No. 025/2017).^[7] ASFI Resolution No. 722/201 sets corporate governance standards for financial entities, promoting transparency, accountability, and stakeholder protection. RA/AEMP Resolution No. 099/2016 governs commercial companies’ internal management, enhancing shareholder rights and corporate responsibility, with amendments ensuring alignment with the Commercial Code.

United States

The United States follows a common-law tradition, where judicial precedent and statutes coevolve through case law. Corporate law is primarily state based,^[8] with Delaware leading due to its specialized courts and rich jurisprudence. Public companies also face federal oversight, notably by the U.S. Securities and Exchange Commission (“SEC”) under statutes such as the Sarbanes-Oxley Act of 2002 (“SOX”).^[9]

State Corporate Law: Delaware and the MBCA

Corporate governance is mainly regulated at the state level. Delaware’s General Corporation Law (“DGCL”) governs many large corporations and codifies director authority, shareholder rights, and protections such as the business judgment rule.^[10] Landmark cases like Guth v. Loft^[11] and Smith v. Van Gorkom^[12] define fiduciary standards.

Many states follow the MBCA, which standardizes principles such as the duties of care and good faith (MBCA section 8.30).

Federal Regulation: Sarbanes-Oxley Act (2002)

Federal law complements state governance for publicly traded corporations. Enacted after major accounting scandals, SOX enhances financial transparency and accountability.^[13] Key features include CEO/CFO certification (section 302), internal control disclosures (section 404), and the Public Company Accounting Oversight Board (“PCAOB”) for auditor oversight.^[14] It also provides whistleblower protections and criminal penalties for fraud.

Fiduciary Duties and Judicial Enforcement

Directors owe fiduciary duties of care and loyalty,^[15] typically reviewed under the business judgment rule.^[16] In conflict scenarios, Delaware courts may apply the “entire fairness” standard, demanding fair dealing and fair price.^[17]

Shareholders enforce these duties through derivative suits, especially in closely held corporations. Federal securities laws add enforcement layers for public disclosures and fraud.^[18]

Overview of the Bolivian Corporation: Sociedad Anónima

The S.A. is Bolivia’s most common corporate structure. It is a separate legal entity composed of shareholders with limited liability, meaning that each shareholder is only liable up to its capital contribution.

Incorporation

The S.A. is formed by a partnership agreement (acta de fundación), with legal effect triggered upon registration with the Commercial Registry (Article 133). Founding partners are jointly responsible for formalizing incorporation, and the business name must reflect its purpose and include the term S.A.

Structure

The structure is as follows:

1. Formation: The S.A. may be closely held or publicly traded. It requires a minimum of three shareholders (Article 220(1)); no maximum cap applies.
2. Capital: Capital is represented by shares. Contributions may include money; personal or real property (Article 150); rights (Article 152); credits (Article 153); or securities (Article 157)—though “use rights” (Article 155) and labor (Article 156) are excluded.
3. Shares: Shares are transferable via endorsement and registration.
4. Management: A board of directors (three to twelve members) holds nondelegable authority (Article 295). Meetings may be held virtually or abroad, but voting by mail is prohibited.
5. Legal Representation: Legal representation is held by the chair or delegated to another director or third party, who must be a Bolivian national or legal resident.
6. Shareholders’ Meetings: Shareholders’ meetings are convened as ordinary or extraordinary meetings per statutory guidelines (Articles 278–293).

Role of Directors

Bolivia

In the Bolivian S.A., the board of directors leads corporate policy and oversight, serving as a bridge between management and shareholders. The system integrates an assembly-based body, ensuring shareholder engagement, alongside the board of directors, which executes the company’s corporate objectives.^[19] It comprises three to twelve members, who are elected and removable by the ordinary general meeting. Directors may be shareholders or independent appointees.

The board of directors exercises the corporation’s legal representation before third parties with whom the corporation enters into contracts, acquires rights, and assumes obligations.^[20] While the board of directors constitutes the administrative organ of the corporation, it may delegate administrative duties to a management body charged with executing the corporation’s operations. These officers are considered to be corporate managers and representatives of the corporation with express powers established in a notarized and recorded power of attorney.

United States

In the United States, corporate directors play a crucial role in governance, balancing oversight responsibilities with strategic decision-making. Corporate executives handle the day-to-day management of the corporation, while the board of directors, mandated by law, oversees and monitors their decisions to ensure alignment with corporate objectives and shareholder interests.^[21]

The board’s key responsibilities include the following:

1. Fiduciary Responsibilities: Directors owe duties of care and loyalty to the corporation and its shareholders. The duty of care requires informed and prudent decision-making, while the duty of loyalty mandates that directors prioritize the corporation’s interests over personal gain.^[22]
2. Strategic Oversight: Directors help shape the corporation’s long-term vision, advising management on key business strategies and ensuring alignment with shareholder interests.^[23]
3. Risk Management: Boards are responsible for identifying and mitigating risks, including financial, operational, and regulatory risks. They establish internal controls and compliance mechanisms to safeguard the corporation.^[24]
4. Executive Supervision: Directors oversee senior management, including hiring and evaluating the CEO. They ensure leadership accountability and may intervene in cases of misconduct or poor performance.^[25]
5. Regulatory Compliance: Boards ensure adherence to corporate laws, stock exchange requirements, and industry regulations. In publicly traded corporations, they also oversee financial disclosures and compliance with SEC regulations.^[26]
6. Shareholder Representation: Directors act as intermediaries between shareholders and management, ensuring transparency and responsiveness to investor concerns.^[27]

Fiduciary Duties: Bolivia Versus United States

Bolivia

Duty of Diligence and Duty of Loyalty

Bolivian corporate law imposes duties of diligence, prudence, and loyalty on directors (Article 164). These broad standards lack precise judicial interpretation,^[28] making enforcement reliant on administrative regulations like ASFI Resolution No. 722/2012^[29] and RA/AEMP Resolution No. 099/2016^[30] (amended by No. 025/2017^[31]).

Based on this framework, the following principles emerge:

• Diligence (deber de diligencia) demands informed, responsible decision-making aligned with legal norms.
• Loyalty (deber de lealtad) requires prioritizing the corporation’s interests, avoiding conflicts, personal gain, and misuse of confidential information.

Conflicts of Interest

While the Commercial Code does not define conflicts of interest, Securities Law 1834 (Article 103) provides a regulatory definition: any act yielding illegitimate advantage through the use of information, provision of services, or transactions in the securities market.

Though grounded in securities regulation, this rule underscores core fiduciary duties—especially loyalty—by targeting misuse of information and corporate opportunities. It serves as a broader standard for managing conflicts of interest and reinforces that directors must avoid compromising their judgment or the corporation’s integrity.

Expanding on this principle, RA/AEMP Resolution No. 025/2017 (Article 24) outlines a structured approach to managing conflicts of interest. It mandates disclosure within five days and bars conflicted parties from voting, ensuring transparency and fair governance.

Board Independence

A Bolivian S.A. board is not required to include independent directors, but shareholders may choose to do so. Independent directors play a critical role in corporate governance worldwide, mitigating undue influence and ensuring impartial decision-making at the board level. Independent directors are appointed based on their professional reputation and lack of ties to the corporation’s management or principal shareholders.^[32]

In Bolivia, Article 17 of RA/AEMP Resolution No. 025/2017 allows voluntary declarations of director affiliations to assess impartiality. Although nonbinding, this tool supports independent oversight and could strengthen confidence if made mandatory.

United States

In the United States, corporate boards fulfill two key roles: advisory and oversight. In the advisory role, the board of directors consults with management on strategic and operational matters, while in the oversight role, it monitors management to ensure compliance with legal duties and alignment with shareholder interests.^[33] Directors ultimately bear responsibility for managing the corporation’s affairs and, in doing so, owe fiduciary duties to both the corporation and its shareholders.^[34]

Fiduciary Duties: Duty of Care and Duty of Loyalty

In the United States, corporate law mandates that the board of directors comply with the principle of fiduciary duty, which, in effect, means that the directors have a legal obligation to act in the interests of the corporation.^[35]

U.S. corporate law, especially under Delaware law, recognizes two primary fiduciary duties: the duty of care and the duty of loyalty. These duties are accompanied by related obligations, including the duty of candor (or disclosure), the duty to monitor, and the duty of obedience. The duty of candor, also known as the duty to disclose, is inherent in both the duty of loyalty and the duty of care; this duty requires directors to ensure that the information provided to shareholders is both materially complete and accurate.^[36] The duty to monitor, often referred to as the Caremark duty,^[37] obligates directors to implement and oversee internal controls that enable informed and lawful corporate decision-making. Under this duty, directors are required to implement information and reporting systems that are reasonably designed to provide timely and accurate information. This is essential for enabling management and the board of directors to make informed decisions.^[38]

Delaware courts have expanded these obligations in cases such as Marchand v. Barnhill^[39] and In re Clovis Oncology, Inc. Derivative Litigation,^[40] emphasizing that directors of monoline companies in highly regulated industries face heightened oversight responsibilities.^[41] Courts consider whether directors failed to establish systems to ensure legal compliance, and they assess liability accordingly.^[42]

Duty of Care

The traditional formulation of a director’s duty of care uses a “reasonably prudent man” standard quite like that of tort law.^[43] It is a fundamental principle that requires a director to exercise the degree of care that an “ordinarily careful and prudent man would use in similar circumstances.”^[44] This standard enables shareholders and courts to hold directors accountable for negligent or uninformed decisions.^[45] A breach typically requires a showing of gross negligence.

The duty of care is reinforced by the obligation to act in good faith, honestly, diligently, and in compliance with the corporation’s legal and ethical obligations.^[46] This duty of care overlaps with the duty of obedience, which obliges directors to ensure that the corporation operates within the bounds of its governing documents and applicable laws.^[47]

The duty of candor, as a component of the duty of care, obliges directors to disclose all material facts truthfully and completely. A failure to do so, whether through negligence or omission, may constitute a breach of fiduciary duty, especially in contexts involving shareholder communications or major corporate transactions.^[48]

Duty of Loyalty

The duty of loyalty is primarily governed by state corporate law, with Delaware law being particularly influential due to its prominence in corporate governance.^[49] Courts apply different standards of review, including the entire fairness standard, which requires directors to prove that a transaction was fair in both price and process.^[50]

The duty of loyalty mandates that directors prioritize the corporation’s interests over their own and avoid conflicts of interest, misappropriation of corporate opportunities, and insider trading.^[51] Directors must act in good faith, with integrity, and without using their position for personal gain.^[52] The duty of loyalty essentially prohibits self-dealing, such as entering self-interested transactions, and requires that directors act solely in the corporation’s best interests.^[53]

Board Independence

In the United States, board independence is a cornerstone of effective corporate governance. To fulfill their advisory and oversight responsibilities, directors must be able to exercise objective judgment without undue influence from management.^[54] Independence ensures that directors can critically assess corporate strategy, risk exposure, and executive performance—and, when necessary, oppose decisions or actions taken by management that may not serve the best interests of shareholders.^[55] This is especially crucial in contexts involving potential conflicts of interest, such as related-party transactions or executive compensation decisions.

Various regulatory and listing standards, including those promulgated by the New York Stock Exchange (“NYSE”) and Nasdaq, require that a majority of board members in publicly traded corporations be independent, as defined by criteria that evaluate financial, familial, and business relationships with the corporation and its executives.^[56] Such requirements are designed to enhance transparency, promote accountability, and preserve the integrity of board deliberations.

In privately held corporations, board independence is not mandated by statute or listing standards, as is the case for publicly traded entities governed by rules such as NYSE § 303A.02 or Nasdaq Rule 5605.^[57] However, while there is no formal legal requirement under state corporate law for private companies to appoint independent directors, their presence can mitigate agency costs and reduce the risk of self-dealing, especially in contexts involving related-party transactions or succession planning.^[58] Moreover, venture capital and private equity firms often contractually require independent or investor-appointed directors as a condition of investment, reflecting the practical importance of independence even outside public markets.^[59]

Board Liability: Bolivia Versus United States

Bolivia

In the Bolivian S.A., directors and managers form a unified administrative body and share joint and unlimited liability for harm caused by misconduct or negligence (Articles 163–68, 321).^[60]

This is explained by the fact that in such corporations, where the board of directors is the governing body, the administrators include both the board members themselves and the managers whom they appoint and empower. Since managers are appointed by the board, they act on its behalf, creating a unified administrative body where both directors and managers are jointly and unlimitedly liable.^[61]

Article 164^[62] establishes the fiduciary duties and corresponding liability of corporate administrators^[63] and legal representatives, such as directors, mandating that they act with diligence, prudence, and loyalty in the exercise of their functions. This provision imposes a high standard of conduct, ensuring that those in management positions prioritize the interests of the company and its stakeholders. Failure to adhere to these duties, whether through wrongful acts or negligent omissions, can result in joint and unlimited liability for any damages caused. This means that each responsible individual can be held fully accountable for the entire amount of harm, with no limitation on personal financial exposure.

Article 163 grants broad powers to the board of directors and appointed managers to act on behalf of the corporation, as long as their actions comply with the corporate charter and the law.^[64] The corporation is bound by these actions provided that they are not clearly unrelated to the corporation’s purpose.^[65] If directors or managers exceed the scope of the corporate charter, legal authority, or applicable law, they bear personal liability, meaning that they must answer for these actions with their own assets.^[66]

This principle of personal liability is particularly relevant in dealings with third parties. For example, Article 166 states that administrators and representatives are jointly and unlimitedly liable for any willful misconduct committed in the name of the corporation.^[67] Article 166 serves as a protective measure for third parties dealing with the corporation, ensuring that intentional misconduct by corporate officials does not go unpunished and cannot be shielded behind the corporate entity.

In addition to liability for misconduct, directors are also accountable for financial mismanagement, particularly regarding unlawful profit distributions under Article 168. This provision allows both the corporation and its creditors to seek restitution for distributions made in violation of the law. Those who received improper distributions, along with the board members who approved them, share joint responsibility and may be required to reimburse the corporation.^[68] By enforcing these measures, the law aims to safeguard corporate capital and protect third-party creditors from financial instability caused by unauthorized asset depletion.

Beyond liability for unlawful profit distributions, directors are also subject to broader fiduciary accountability under Article 321 of the Bolivian Commercial Code. This provision establishes joint and unlimited liability for directors of an S.A. in relation to the corporation, its shareholders, and third parties. Specifically, directors may be held accountable for (1) mismanagement of their duties; (2) violations of applicable laws, bylaws, or shareholder resolutions; (3) damages resulting from gross negligence, deceit, fraud, or abuse of authority; and (4) unauthorized profit distributions.^[69] By outlining an extensive fiduciary framework, Article 321 reinforces corporate accountability beyond internal governance, ensuring that directors remain answerable to both shareholders and external stakeholders.

This framework prioritizes transparency and ethical leadership, with liability serving as both a deterrent and a corrective tool for governance lapses.

United States: Delaware and the MBCA

In the United States, directors of corporations are subject to fiduciary duties rooted in common-law principles and codified in state statutes, most notably those of Delaware,^[70] and the MBCA.^[71] The legal framework governing directors emphasizes limited liability but imposes personal responsibility for breaches of fiduciary duties, violations of statutory distribution rules, and misconduct falling outside the protections of the business judgment rule.

Under Delaware law, corporate directors owe two core fiduciary duties: the duty of care and the duty of loyalty.^[72] The duty of care requires directors to act on an informed basis and with the care that an ordinarily prudent person would exercise in similar circumstances.^[73] In contrast, the duty of loyalty mandates that directors act in the best interests of the corporation and avoid conflicts of interest, self-dealing, or usurpation of corporate opportunities.^[74] Delaware courts evaluate director conduct under the business judgment rule, a presumption that directors acted in good faith, on an informed basis, and in the best interest of the corporation.^[75] This presumption can be rebutted by evidence of gross negligence, bad faith, or disloyalty.^[76]

The MBCA largely mirrors Delaware’s structure but provides more detailed statutory guidance. Section 8.30 of the MBCA codifies the standards of conduct for directors, requiring good faith, the care of an ordinarily prudent person, and a reasonable belief that the action is in the corporation’s best interests.^[77] Section 8.31 establishes liability when directors breach those duties and cause harm to the corporation or its shareholders.^[78]

Directors may also be held liable under DGCL § 174, which imposes liability for unlawful dividends or other distributions of capital.^[79] However, this liability is subject to a negligence standard and provides for a good-faith defense, unlike the Bolivian regime, which imposes joint and unlimited liability. Shareholders who knowingly receive unlawful distributions may also be required to return them, although the standard is generally less strict than in Bolivian law.^[80]

Moreover, under DGCL § 102(b)(7), Delaware permits corporations to adopt charter provisions eliminating directors’ personal liability for breaches of the duty of care.^[81] However, this exculpation does not extend to breaches of the duty of loyalty, acts not in good faith, or intentional misconduct.^[82] This limitation preserves the accountability of directors in the most egregious cases while providing protection for business judgment exercised in good faith. In cases involving fraud or self-dealing, Delaware courts apply the entire fairness doctrine, shifting the burden to directors to prove both fair dealing and fair price.^[83] This equitable doctrine ensures heightened scrutiny when conflicts of interest exist, particularly in closely held or controlled corporations.

Conclusion: Comparative Analysis

Comparative Analysis of Fiduciary Duties: Bolivia Versus United States

Bolivia and the United States share fundamental fiduciary principles, yet diverge significantly in legal structure, enforcement mechanisms, and doctrinal development. While both systems recognize the core duties of care and loyalty, their governance models reflect distinct regulatory philosophies shaped by civil law and common-law traditions, respectively.

In Bolivia, these fiduciary duties are grounded primarily in Article 164 of the Bolivian Commercial Code, which imposes on directors the obligation to act with diligencia, prudencia, and lealtad, under penalty of joint and several liability for harm resulting from their acts or omissions.^[84] This standard is further developed in RA/AEMP Resolution No. 099/2016, which applies to a range of corporate forms and mandates performance of duties with loyalty, confidentiality, and the prudence of a diligent businessperson.^[85] However, Bolivian commercial jurisprudence has yet to establish consistent interpretations of these terms, and statutory guidance remains broad in scope. Complementary regulations, such as RA/AEMP No. 025/2017 and ASFI Resolution No. 722/2012, attempt to refine the scope of fiduciary obligations and conflicts of interest;^[86] but many provisions, such as declarations of independence, remain discretionary, indicating a framework still in regulatory transition.

In contrast, the fiduciary regime in the United States, particularly as developed under Delaware corporate law, is characterized by doctrinal precision, extensive case law, and enforceability. The duty of care requires directors to act with the level of prudence that a reasonably careful person would use in similar circumstances.^[87]

Failures in oversight may result in liability under the Caremark doctrine, which obligates directors to establish and monitor adequate reporting systems.^[88] The duty of loyalty prohibits self-dealing and demands that directors place the corporation’s interests above their own, with violations subject to heightened judicial scrutiny under the entire fairness standard.^[89]

Additionally, duties such as the duty of candor, requiring full and truthful disclosure of material information, and the duty of good faith, reinforcing honest decision-making, have evolved through judicial interpretation.^[90] Together, these doctrines are bolstered by well-developed litigation standards, such as the business judgment rule, which defers to directors’ decisions absent gross negligence or bad faith.

This comparison highlights how similar fiduciary concepts are operationalized differently across civil law and common-law traditions. Bolivia’s evolving framework seeks to institutionalize global governance norms within a regulatory model still reliant on administrative resolutions. The United States, by contrast, leverages a robust body of jurisprudence and institutional accountability, particularly in Delaware, to clarify and enforce fiduciary obligations and adapt them to changing economic realities.

Going forward, Bolivia’s corporate governance system may benefit from enhanced judicial engagement, more precise statutory definitions, and stronger enforcement tools. Meanwhile, developments in U.S. law, particularly in areas such as environmental, social, and governance (“ESG”) oversight, cybersecurity governance, and shareholder activism, continue to stretch the contours of traditional fiduciary obligations.

Despite their differences, both frameworks seek to balance corporate authority with accountability. Bolivia’s structured liability model emphasizes deterrence and stakeholder protection, while the U.S. system prioritizes adaptability and judicial oversight. Understanding these distinctions offers valuable insights into global governance trends and potential reforms to strengthen corporate accountability across jurisdictions.

Comparative Analysis of Director Liability for Fiduciary Breaches: Bolivia Versus United States

Director liability for fiduciary breaches in Bolivia and the United States reflects two distinct governance models—Bolivia’s civil law framework, which emphasizes formal compliance and broad accountability, and the U.S. common-law system, which prioritizes judicial discretion and director autonomy. While both systems share the overarching goal of promoting responsible corporate management and protecting stakeholder interests, they diverge significantly in their approach to director liability, the scope of fiduciary duties, and the mechanisms for enforcement.

Bolivia’s Commercial Code enforces a strict and formal approach to director liability. Directors and managers of an S.A. are subject to a regime of joint and unlimited liability for breaches of duty, statutory violations, unauthorized distributions, and acts of gross negligence or fraud. The Code imposes this liability not only vis-à-vis the corporation and its shareholders but also in relation to third parties, underscoring the protective function of Bolivian corporate law toward creditors and the broader public. This civil law orientation prioritizes legal certainty, deterrence, and stakeholder safeguards over managerial discretion.

In contrast, the U.S. framework, especially under Delaware law and the MBCA, emphasizes director independence, business judgment deference, and limited liability, unless clear breaches of fiduciary duty are demonstrated. The duties of care and loyalty form the foundation of this system, with liability narrowly tailored to situations involving bad faith, gross negligence, or disloyal conduct. Delaware’s business judgment rule and statutory exculpation provisions (e.g., DGCL § 102(b)(7)) provide directors with considerable latitude to make informed, good-faith decisions without fear of personal exposure. Even in cases of unlawful distributions, liability under DGCL § 174 is subject to a good-faith defense and limited to directors who acted negligently or without reasonable reliance on financial statements.

Notably, Bolivia neither provides a general presumption of good faith nor permits contractual exculpation of directors from fiduciary liability. The Bolivian system therefore imposes stricter accountability ex ante, while the U.S. model relies on judicial review and litigation ex post to sanction misconduct. Moreover, while Bolivia’s law treats the board and management as a unified administrative organ, U.S. corporate law draws a sharper distinction between the board’s oversight role and the executives’ operational responsibilities, reinforced by governance norms such as board independence and committee structure.

Overall Comparison

In sum, Bolivia’s fiduciary regime favors formal compliance, collective responsibility, and protective liability doctrines, while the U.S. regime favors flexibility, delegation, and calibrated enforcement. These governance models reflect broader legal traditions. Bolivia’s approach prioritizes preventative oversight and collective accountability, while the U.S. system favors judicial evaluation and individualized director responsibility. These differences offer valuable insights for comparative corporate governance studies, particularly in evaluating how legal systems incentivize integrity, prudence, and fairness in corporate leadership.

1. Political Constitution of the Plurinational State of Bolivia, Feb. 7, 2009 (Bol.). ↑

2. Bolivian Com. Code, Decreto Ley No. 14379 (Feb. 25, 1977) (Bol.). ↑

3. Id. art. 5(2) (stating that legal entities are also considered merchants (comerciantes)). The term commercial is not used in a strict sense, but rather the Code provides a generic notion that encompasses commercial activities (objective) and the subject that performs the acts (subjective). ↑

4. Id. art. 126. ↑

5. Resolución Administrativa ASFI No. 722/2012, Titulo IX, Capitulo XX, Sección I, Autoridad de Supervisión del Sistema Financiero (Dec. 14, 2012) (Bol.). ↑

6. Resolución Administrativa RA/AEMP No. 099/2016, Autoridad de Fiscalización de Empresas (Dec. 30, 2016) (Bol.). ↑

7. Resolución Administrativa RA/AEMP No. 025/2017, Autoridad de Fiscalización de Empresas (Apr. 12, 2017) (Bol.). ↑

8. Understanding the Rigors of Corporate Law in the United States, Rey Abogado (May 29, 2025). ↑

9. For an explanation of the Sarbanes-Oxley Act, see Sarbanes-Oxley Act, Legal Info. Inst. (last visited May 29, 2025). ↑

10. Del. Code Ann. tit. 8, § 141(a) (2024) (conferring management authority on the board of directors). ↑

11. Guth v. Loft, Inc., 5 A.2d 503, 510 (Del. 1939) (articulating the foundational principles of the duty of loyalty). ↑

12. Smith v. Van Gorkom, 488 A.2d 858, 873–81 (Del. 1985) (holding directors liable for breach of the duty of care due to uninformed decision-making). ↑

13. Sarbanes-Oxley Act of 2002, Pub. L. No. 107-204, 116 Stat. 745 (codified in scattered sections of 15 U.S.C. and 18 U.S.C.). ↑

14. 15 U.S.C. § 7241 (2022) (sec. 302); 15 U.S.C. § 7262 (2022) (sec. 404); 15 U.S.C. § 7211 (2022) (establishing PCAOB). ↑

15. See Stone v. Ritter, 911 A.2d 362, 370 (Del. 2006) (clarifying oversight duties as part of the duty of loyalty). ↑

16. Aronson v. Lewis, 473 A.2d 805, 812 (Del. 1984), overruled on other grounds by Brehm v. Eisner, 746 A.2d 244 (Del. 2000). ↑

17. Weinberger v. UOP, Inc., 457 A.2d 701, 711 (Del. 1983). ↑

18. See 15 U.S.C. § 78j(b) (2022); 17 C.F.R. § 240.10b-5 (2022) (prohibiting fraudulent practices under the Securities Exchange Act of 1934). ↑

19. Fernando E. Miranda Mendoza, Gobierno Corporativo en Bolivia: Conflicto de Intereses en los Directores de Sociedades Comerciales 35 (2016). ↑

20. Sarah B. Mendoza, Responsabilidad de los Directores en las Sociedades Anónimas: Es usted Director de una Sociedad Anónima?, Mondaq (May 14, 2012). ↑

21. Paul P. Brountas, Boardroom Excellence: A Common Sense Perspective on Corporate Governance 42 (2004). ↑

22. Dan Byrne, Board Responsibilities: A Practical Guide for Directors, Corp. Governance Inst. (last visited May 20, 2025). ↑

23. Id.; see also Howard Brod Brownstein, Board Oversight of Corporate Compliance, Bus. L. Today (Oct. 12, 2021). ↑

24. Byrne, supra note 22. ↑

25. Holly J. Gregory, Rebecca Grapsas & Claire H. Holland, Corporate Governance and Directors’ Duties in the United States: Overview, Stan. L. Sch. (2023). ↑

26. Aaron Hall, Legal Framework for Board Oversight of Corporate Governance Practices, Aaron Hall Att’y (last visited May 20, 2025). ↑

27. Dirs.’ Inst., Independent Directors and Investor Relations—Building Trust and Transparency with Shareholders, Dirs.’ Inst. (Dec. 10, 2024). ↑

28. Juan Carlos Urenda Díaz, Manual de la Responsabilidad de los Gerentes, Directores y Síndicos 22 (Plural ed., 2012). ↑

29. Article 7 sets out the duties of loyalty and diligence that must be observed by members of the board of directors, senior management, and other governing bodies of financial institutions. ↑

30. RA/AEMP Resolution No. 099/2016 established the corporate governance regulation for commercial companies in Bolivia. This regulation introduced mandatory compliance provisions for corporations, limited liability companies, and other types of business entities. Although it was partially amended by RA/AEMP Resolution No. 025/2017, the core duties of directors and administrators remained unchanged. ↑

31. Article 18 establishes that the powers and responsibilities of directors must be carried out with loyalty, confidentiality, and the diligence of a prudent businessperson. ↑

32. Julio Vicente Flores Konja & Alan Errol Rozas Flores, El Gobierno Corporativo: Un Enfoque Moderno, 15 Quipukamayoc 7 (2008). ↑

33. David Larcker & Brian Tayan, Corporate Governance Matters: A Closer Look at Organizational Choices and their Consequences 57 (2d ed. 2016). ↑

34. Myron M. Sheinfeld & Judy Harris Pippitt, Fiduciary Duties of Directors of a Corporation in the Vicinity of Insolvency and After Initiation of a Bankruptcy Case, 60 Bus. Law. 79 (2004). ↑

35. Joseph Hinsey IV, Business Judgment and the American Law Institute’s Corporate Governance Project: The Rule, the Doctrine, and the Reality, 52 Geo. Wash. L. Rev. 609, 609–10 (1984). ↑

36. Brountas, supra note 21, at 26. ↑

37. The Caremark duties stem from the landmark case In re Caremark International Inc. Derivative Litigation, which established a director’s duty of oversight. In re Caremark Int’l Inc. Derivative Litig., 698 A.2d 959 (Del. Ch. 1996). ↑

38. Holger Spamann, Scott Hirst & Gabriel Rauterberg, Corporations in 100 Pages 45 (3d ed. 2022). ↑

39. Marchand v. Barnhill, 212 A.3d 805 (Del. 2019). ↑

40. In re Clovis Oncology, Inc. Derivative Litig., 2019 WL 4850188 (Del. Ch. Oct. 1, 2019). ↑

41. Katherine M. King, Marchand v. Barnhill’s Impact on the Duty of Oversight: New Factors to Assess Directors’ Liability for Breaching the Duty of Oversight, 62 B.C. L. Rev. 1925 (2021). ↑

42. See Marchand, 212 A.3d at 810, 824 (relying on Blue Bell’s monoline business and the significance of complying with FDA regulations as factors in finding a well-pled Caremark claim); In re Clovis, 2019 WL 4850188, at *1 (explaining the importance of the directors’ duty of oversight as “especially so when a monoline company operates in a highly regulated industry”); King, supra note 41 (discussing the issue). ↑

43. Charles Hansen, The Duty of Care, the Business Judgment Rule, and the American Law Institute Corporate Governance Project, 48 Bus. Law. 1355 (1993). ↑

44. Sheinfeld & Pippitt, supra note 34. ↑

45. Thomas C. Lee, Limiting Corporate Directors’ Liability: Delaware’s Section 102(b)(7) and the Erosion of the Directors’ Duty of Care, 136 U. Pa. L. Rev. 239 (1987). ↑

46. Lee Harris, Mastering Corporations and Other Business Entities 136 (Carolina Academic Press 2009). ↑

47. Larcker & Tayan, supra note 33, at 68. ↑

48. Id. ↑

49. Prac. L. Corp. & Sec., Fiduciary Duties of the Board of Directors (Jan. 2023). ↑

50. Id. ↑

51. E. Norman Veasey, Duty of Loyalty: The Criticality of the Counselor’s Role, 45 Bus. Law. 2066 (1990); Harris, supra note 46, at 162. ↑

52. John Lowry, The Duty of Loyalty of Company Directors: Bridging the Accountability Gap Through Efficient Disclosure, 68 Cambridge L.J. 607 (2009). ↑

53. Harris, supra note 46, at 169. ↑

54. Larcker & Tayan, supra note 33, at 58. ↑

55. Id. ↑

56. NYSE Listed Company Manual § 303A.02 (defining independence); Nasdaq Rule 5605(a)(2); see also In re Oracle Corp. Derivative Litig., 824 A.2d 917, 938–39 (Del. Ch. 2003) (discussing the nuance of independence beyond formal relationships). ↑

57. NYSE Listed Company Manual § 303A.02 (defining independence for listed companies); Nasdaq Rule 5605(a)(2). ↑

58. See Frank H. Easterbrook & Daniel R. Fischel, The Economic Structure of Corporate Law 90–92 (1991) (discussing agency costs and the role of boards in minimizing them). ↑

59. See Jesse M. Fried & Mira Ganor, Agency Costs of Venture Capitalist Control in Startups, 81 N.Y.U. L. Rev. 967, 984–85 (2006) (noting governance mechanisms in venture-capitalist-backed firms, including board composition requirements). ↑

60. Díaz, supra note 28, at 25. ↑

61. Id. ↑

62. Bolivian Com. Code, Decreto Ley No. 14379, art. 164 (Feb. 25, 1977) (Bol.). ↑

63. See id. art. 307 (noting that the term administrator refers to a Bolivian corporation’s board of directors and that corporate management must be entrusted to a board of at least three directors). ↑

64. Id. art. 163. ↑

65. Id. ↑

66. Díaz, supra note 28. ↑

67. Bolivian Com. Code art. 166. ↑

68. Id. art. 168. ↑

69. Id. art. 321. ↑

70. Del. Code Ann. tit. 8 (2024). ↑

71. Model Bus. Corp. Act § 8.30 (Am. Bar Ass’n 2021). ↑

72. Guth v. Loft, Inc., 5 A.2d 503, 510 (Del. 1939); see also Stone v. Ritter, 911 A.2d 362, 370 (Del. 2006). ↑

73. Smith v. Van Gorkom, 488 A.2d 858 (Del. 1985). ↑

74. Guth, 5 A.2d at 510. ↑

75. Aronson v. Lewis, 473 A.2d 805, 812 (Del. 1984). ↑

76. In re Walt Disney Co. Derivative Litig., 906 A.2d 27, 52–53 (Del. 2006). ↑

77. Model Bus. Corp. Act § 8.30 (Am. Bar Ass’n 2021). ↑

78. Id. § 8.31. ↑

79. Del. Code Ann. tit. 8, § 174 (2023). ↑

80. Id.; see also Cede & Co. v. Technicolor, Inc., 634 A.2d 345, 371 (Del. 1993). ↑

81. Del. Code Ann. tit. 8, § 102(b)(7). ↑

82. Malpiede v. Townson, 780 A.2d 1075, 1095–96 (Del. 2001). ↑

83. Weinberger v. UOP, Inc., 457 A.2d 701, 710 (Del. 1983). ↑

84. Bolivian Com. Code, Decreto Ley No. 14379, art. 164 (Feb. 25, 1977) (Bol.) ↑

85. Reglamento de Gobierno Corporativo para Sociedades Comerciales, Resolución Administrativa RA/AEMP No. 099/2016, Autoridad de Fiscalización de Empresas, art. 18 (Dec. 30, 2016) (Bol.). ↑

86. Resolución Administrativa RA/AEMP No. 025/2017, Autoridad de Fiscalización de Empresas, arts. 17, 24 (Apr. 12, 2017) (Bol.); Resolución Administrativa ASFI No. 722/2012, Autoridad de Fiscalización de Empresas, art. 7 (Dec. 14, 2012) (Bol.). ↑

87. Aronson v. Lewis, 473 A.2d 805, 812 (Del. 1984); see also Smith v. Van Gorkom, 488 A.2d 858 (Del. 1985). ↑

88. In re Caremark Int’l Inc. Derivative Litig., 698 A.2d 959, 970 (Del. Ch. 1996). ↑

89. Weinberger v. UOP, Inc., 457 A.2d 701, 710 (Del. 1983). ↑

90. See Malpiede v. Townson, 780 A.2d 1075, 1085–87 (Del. 2001); Stone v. Ritter, 911 A.2d 362, 370 (Del. 2006). ↑