Fiduciary Relationship of the Managers in Joint Stock Companies: A Comparative Study in British & Iranian Laws

Managers as a fiduciary have obligations for preserving the entity of the company and the interests of the shareholders, but these obligations have specific conditions that cannot be ideally justified all in accordance with the general rules of representation. Therefore, it is necessary that these obligations be specified in a special legal framework which, while recognizing the boundaries of the legal relation of the manager with the company and the shareholders, prevents them (the managers) from abuse. In British Law, the fiduciary relationship has defined the limits of powers and obligations of the managers. Iranian law has not expressly accepted the mentioned theory as a general principle, but, there are some indications in Iranian Commercial Law and the Law of Exchange Market that may be used to justify this theory. In particular, we may refer to the obligations to observe loyalty, care, good faith and providing information.