Page - 241 - in VULNERABLE - The Law, Policy and Ethics of COVID-19

241Balancing Risk and Reward in the Time of COVID-19 these questions should be answered by “yes” and “no.” Manager accountability to shareholders was sufficient to promote good deci- sions about risk.29 This is still the guiding rationale behind the per- missive structure of corporate law in Canada—to create a framework to ensure corporate officers and directors (“corporate managers”30) evaluate the best interests of the corporation rationally, based on the factors they consider relevant. Against that backdrop, where the decision-making process seems reasonable in the circumstances, courts tend to be highly deferential to management regarding the soundness of business decisions, absent strong indications to the contrary.31 This approach is tailored to the context in which business deci- sions are scrutinized—where there is a conflict between “corporate” stakeholders (managers and shareholders or between majority and minority shareholders), though they may also arise where corporate decisions affect other stakeholders with an “interest” in the corpora- tion.32 This latter situation was at the heart of the BCE case, in which the Supreme Court of Canada recognized that sometimes corporate decisions will trigger unavoidable negative effects for some stake- holders. In BCE, the Court recognized the need for a more flexible concept of best interests of the corporation, one in which managers could consider factors and interests beyond those of the limited cate- gories of stakeholders expressly dealt with in corporate law (directors and officers, majority shareholders, minority shareholders), including those of employees, suppliers, creditors, consumers, governments, and the environment.33 In framing “best interests” primarily as the corporation’s long- term interests as a going concern and as a responsible corporate citi- zen, the Court implicitly integrated some elements of theories of the 29. Henry Hansmann & Reiner Kraakman, “The End of History for Corporate Law” (2000) 89:2 Geo LJ 439 at 439-68. 30. For ease of exposition, I use the term “manager” to refer collectively to directors and officers of the corporation. Directors are invested with the power to manage the corporation, but they can delegate most of their powers to officers. Those who exercise these powers are subject to two special duties: the duty of loyalty (or the fiduciary duty to manage in the best interests of the corporation) and the duty of care to act in a prudent and diligence manner. See e.g. CBCA, supra note 2, ss 122(1)(a)–(b); Art 322 CCQ; Business Corporations Act, CQLR c S-31.1, s 119. 31. BCE  Inc  v  1976  Debentureholders, 2008 SCC 69 at para 40 [BCE]; Unique Broadband Systems  Inc,  Re, 2014 ONCA 538 at para 72. 32. BCE, supra note 31 at paras 41-46, 81-82. 33. Ibid at para 42.