Proxy/No Proxy
When you’re in a position where you must prioritize someone else’s interests over your own, it’s called a “fiduciary duty.” It’s like being the go-to person for someone—you’re expected to set aside your personal goals and focus entirely on what’s best for them. If you’re an agent with this duty and you slip up, you’re held accountable for any problems that arise from your actions. It’s a serious responsibility that requires your full attention.
If you have fiduciary duty, you can’t just hand it off to someone else like passing a hot potato. For example, directors must handle their own duties, no stand-ins allowed. But if you’re a shareholder without that duty, go ahead and let a proxy take over—it’s totally fine! So, if you’ve got fiduciary duty, it’s a “no” to proxies; without it, it’s a “yes” to passing the torch. Finally on simple note: No fiduciary duty – Proxy is possible. With fiduciary duty – No proxy is possible, right?
By CA L.Muralidharan and CPA L.Mukundan
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