Duty of Loyalty


Definition of Duty of Loyalty

Duty of loyalty is a term specifically used in corporate law which describes conflict of interest between fiduciaries. It is also required by the fiduciaries to put their personal interest behind the corporate interest.



Duty of Loyalty Explained

For a director of a corporation to take a decision that mutually benefits both himself and the company is acceptable but if he puts his interest ahead of the company's then the duty of loyalty is breached.