DIRECTOR’ AND OFFICERS’ LIABILITY
Serving as a Director or Officer of a company entails a growing legal exposure, which intensifies significantly in the case of companies listed on Spanish markets (IBEX 35, continuous market, BME Growth) and international exchanges, where oversight by sectoral regulators and supervisory bodies —both domestic and international— adds a further layer of complexity to the liability of board members. Periodic and material disclosure obligations, fit-and-proper requirements, administrative sanctioning regimes, regulatory compliance demands and anti-money laundering policies create a framework in which any management decision may be subject to simultaneous scrutiny from multiple spheres —corporate, administrative-sanctioning and even criminal—, significantly raising the standard of diligence and transparency expected of the governing body.
Management decisions, interactions with shareholders, institutional investors, third parties and supervisory and regulatory bodies and, where applicable, financial distress scenarios may give rise to liability claims against the board or against its members individually. In that context, the anticipation of risk and the proper documentation of the decision-making process are as decisive as the litigation defence itself when the dispute materialises.
WHERE CORPORATE MANAGEMENT BECOMES PERSONAL EXPOSSURE
The liability of Directors and Officers extends across two fundamental dimensions that require differentiated yet coordinated legal treatment.
In the corporate sphere, the Spanish Companies Act (Ley de Sociedades de Capital) imposes duties of care and loyalty whose breach may give rise to derivative and direct liability claims, as well as to actions by shareholders or third parties. The review of the corporate governance framework, the analysis of directors’ duties, the management of conflicts of interest, the proper structuring of delegations, committees and internal decision-making protocols and the documentation and traceability of the decision-making process are essential elements to ensure diligent and demonstrable conduct. The preparation of resolutions and measures designed to reduce the personal exposure of directors at general meetings and board sessions, together with the design of preventive strategies against potential liability claims, form a core part of the engagement in this area.
In the insolvency sphere, when the company is insolvent or approaching insolvency, the conduct of Directors and Officers is examined under a particularly rigorous standard. The qualification proceedings (pieza de calificación) represent the procedural stage at which it is determined whether the insolvency was fortuitous or culpable and, in the latter case, the financial and personal consequences for the directors may be of extraordinary gravity. The early identification of risk factors in the pre-insolvency scenario, the planning of actions with a defensive approach, the construction of the narrative and the preparation of the documentary support evidencing the director’s diligence, the engagement with the insolvency administrator and the coordination with financial and accounting teams are decisive for the effective defence of the governing body in this context.
COMPREHENSIVE PROTECTION AGAINST THE RISKS OF OFFICE
Lopezmarques has a team specialising in the prevention, management and defence of Directors and Officers against the risks inherent in holding office. The engagement combines a preventive dimension —aimed at minimising exposure and structuring decision-making from the ordinary course of the company’s business— with a robust litigation defence when the dispute becomes unavoidable, encompassing legal representation, procedural strategy and negotiation in judicial proceedings arising from liability claims.
The engagement is tailored to every stage at which the company or the director may find themselves, from the ordinary course of business and the preparation of general meetings and board sessions through to financial deterioration, pre-insolvency, insolvency and qualification proceedings, including full technical defence in the qualification stage —filing of submissions, proposal and examination of evidence, attendance at the oral hearing and defence against claims of culpable insolvency— and the negotiation and management of contingencies linked to insolvency-related liabilities. The team acts for both Directors and Officers and for the companies themselves, adapting the strategy to the specific interest of the client in each case.
