Analysis of the Scope of Conflict of Interest between Director and Company in Commercial Company Law(A Comparative Study in Iranian and English Law)

Mohseni, Saeed; Teymourimoghaddam, Faezeh; Nadi, Mohammadtaghi; Robati, Mahsa

doi:10.48308/eclr.2026.241753.1202

Analysis of the Scope of Conflict of Interest between Director and Company in Commercial Company Law(A Comparative Study in Iranian and English Law)

Document Type : Original Article

Authors

saeed mohseni ¹

faezeh teymourimoghaddam ²

mohammadtaghi nadi ²

mahsa robati ³

¹ Associate Professor, Faculty of Law and Political Science, Ferdowsi University of Mashhad, Mashhad, Iran. Corresponding Author’s email: s-mohseni@um.ac.ir

² Ph.D. Student, Faculty of Law and Political Science, Ferdowsi University of Mashhad, Mashhad, Iran.

³ Ph.D. in Private Law, Department of Private Law, Faculty of Law and Political Science, Tehran University (Farabi College), Qom, Iran

https://doi.org/10.48308/eclr.2026.241753.1202

Abstract

The influence and position of directors in commercial companies and the impact of their decisions on the success of their respective organizations is a critical factor that highlights the necessity to consider the "Conflict of Interest Between Director and the Company" issue. In such cases, the interests of the director are pitted against those of the company, compelling the director to choose between the two. Consequently, in certain legal systems like the United Kingdom, in addition to the legal obligation of directors to avoid conflict of interest situations, this matter also holds significant importance in judicial procedures and legal doctrine. Given the lack of explicit commentary by the Iranian legislative system regarding conflict of interest in commercial companies, the present research employs a descriptive-analytical approach and draws upon the experiences from the English legal system to examine the scope of director-company conflict of interest from personal, subject-related, and time-related perspectives. According to the research findings, apart from the necessity of identifying the concept and types of commercial companies, the term "director" encompasses all individuals who, under any title and in any manner, are connected with company management and management activities. These directors are obligated to avoid any actual and potential conflicts in competitive, financial, and information-related company matters, instead prioritizing the interests of the company.

Keywords

Competition, Conflict of interests, Fiduciary duty, Interests ;"> of the Company, Personal interest

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