Lawsuits can be filed against your company, each executive and director, or all. These suits can originate from your customers, creditors, competitors, suppliers, vendors, government and regulatory agencies, current or former employees, or even investors. These exposures are not just for publicly traded companies. The following elaborate on risks of non-profits and privately-owned business:
It is important to remember that family-owned businesses are not immune to these risks. How they manage their business can equally be the basis of lawsuits. Since family and business goals can become intertwined, decisions may be made for nonbusiness reasons that do not maximize their shareholders’ welfare. Whether shareholders are family or non-family members, they can hold all directors and officers of the company liable.
As the business, legal, and regulatory landscapes evolve, so too does the D&O risk of business owners.