What is a primary method by which directors may defend against a claim?

The primary method by which directors may defend against a claim, particularly in the context of corporate governance and potential liability, often involves the involvement of independent directors. When a board of directors is faced with a claim, such as in cases of breach of fiduciary duty, demonstrating that the decision-making process included independent directors can be critical. Independent directors are those who do not have a material relationship with the corporation, which helps ensure objectivity and reduces potential conflicts of interest.

A majority vote of independent directors can serve as a defense strategy because their participation can signify a fair and unbiased evaluation of the situation. Courts frequently look favorably upon decisions made with the involvement of independent directors when assessing the business judgment rule, which protects directors from liability if they acted in good faith, with due care, and in the best interests of the corporation.

In contrast, the other options may not provide the same level of protection. A majority vote of the board—if the board includes directors with conflicts of interest—might not afford the same defense as decisions grounded in the contributions of independent directors. Similarly, shareholder approval typically relates to specific actions or transactions rather than serving as a direct defense mechanism for directors against claims. An executive committee's majority vote, unless composed entirely of independent members