McDonald’s Toxic Culture Ruling Sheds Light on Officer Liability

A novel Delaware Chancery Court ruling that corporate officers can be held accountable by shareholders sheds some new light on oversight liability while raising questions over how far the line of duty extends.

The court for the first time explicitly held—in a toxic workplace case against McDonald’s Corp.'s former chief people officer—that CEOs and other executives owe investors a duty of oversight comparable to that owed by a board of directors. Typically a company’s board will face shareholder claims that it failed to engage in adequate oversight or ignored red flags over time.

To see the court write it out ...