The business judgment rule is a United States case law-derived concept in corporations law whereby the "directors of a corporation . . . are clothed with presumption, which the law accords to them, of being in their conduct by a bona fide regard for the interests of the corporation whose affairs the stockholders have committed to their charge".
To challenge the actions of a corporation's board of directors, a plaintiff assumes "the burden of providing evidence that directors, in reaching their challenged decision, breached any one of the triads of their fiduciary duty — good faith, loyalty, or due care". Failing to do so, a plaintiff "is not entitled to any remedy unless the transaction constitutes waste . . . the exchange was so one-sided that no business person of ordinary, sound judgment could conclude that the corporation has received adequate consideration".
Read more about Business Judgment Rule: Basis, Duty of Care and Duty of Loyalty, Standard of Review, Rationale
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