Bonuses of a Member of the Board of Directors of the Company: Paradoxes of Law Enforcement Practice

The article discusses in detail the legal and managerial aspects of the establishment and payment of remuneration to members of the board of directors of joint-stock companies in Russia. The work raises the issue of legal uncertainty and contradictions in the application of the current legislation and by laws, as well as corporate recommendations regarding bonuses. The basis of the analysis was regulatory documents (Civil Code of the Russian Federation, federal laws on AO and LLC), clarifications of authorized bodies (Bank of Russia, the Ministry of Finance, Rosimunstra), judicial precedents and the practice of the companies themselves. The key problem discussed in the work is the lack of a clear regulation of the sources of bonuses in the legislation: should they be paid exclusively from net profit, as the Federal Property Management Agency insists, or other sources, as follows from the position of the Bank of Russia. The author indicates a legal conflict between the recommendations of regulatory authorities and real corporate practice, when companies, especially with state participation, strive to minimize risks and refuse to pay in the absence of profit, even if the decision on payment was made by the general meeting of shareholders. The article discusses the conditions under which the decision of the meeting of shareholders on the payment of bonuses can be invalidated, including as an interest transaction, and in what cases its subsequent contest or cancellation is possible. Examples from arbitration practice are analyzed, including the contradictory approaches of the courts of different instances to interpret the same norms. The author also affects the issue of subsidiary liability of members of the board of directors in the framework of bankruptcy cases, and also discusses potential mechanisms for protecting the interests of minority shareholders. Methods of calculating bonuses and variability of intra-corporate regulations are revealed: from fixed payments to complex formulas taking into account participation in meetings, availability of profit, execution of additional functions, reference to dividend policy and other KPIs. The author offers a rethinking of universal approaches, promoted in the corporate governance code, insisting on the need for a differentiated approach, taking into account the specifics of the company, its property structure and position in the market. The article systematizes practice and identifies problem areas, and also offers recommendations for the formation of more stable and balanced mechanisms for material stimulation of members of the board of directors, taking into account the modern realities of corporate governance in Russia.

Authors

Publication Details

Journal
Journal of Modern Competition
Published
2025-06-27
DOI
https://doi.org/10.37791/2687-0657-2025-19-3-49-72
Primary Topic
Legal Studies and Reforms
Type
article
Field-Weighted Citation Impact
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article

Bonuses of a Member of the Board of Directors of the Company: Paradoxes of Law Enforcement Practice

Oleg V. Osipenko
Journal of Modern Competition
Legal Studies and Reforms
article

Bonuses of a Member of the Board of Directors of the Company: Paradoxes of Law Enforcement Practice

Oleg V. Osipenko
article en

Abstract

The article discusses in detail the legal and managerial aspects of the establishment and payment of remuneration to members of the board of directors of joint-stock companies in Russia. The work raises the issue of legal uncertainty and contradictions in the application of the current legislation and by laws, as well as corporate recommendations regarding bonuses. The basis of the analysis was regulatory documents (Civil Code of the Russian Federation, federal laws on AO and LLC), clarifications of authorized bodies (Bank of Russia, the Ministry of Finance, Rosimunstra), judicial precedents and the practice of the companies themselves. The key problem discussed in the work is the lack of a clear regulation of the sources of bonuses in the legislation: should they be paid exclusively from net profit, as the Federal Property Management Agency insists, or other sources, as follows from the position of the Bank of Russia. The author indicates a legal conflict between the recommendations of regulatory authorities and real corporate practice, when companies, especially with state participation, strive to minimize risks and refuse to pay in the absence of profit, even if the decision on payment was made by the general meeting of shareholders. The article discusses the conditions under which the decision of the meeting of shareholders on the payment of bonuses can be invalidated, including as an interest transaction, and in what cases its subsequent contest or cancellation is possible. Examples from arbitration practice are analyzed, including the contradictory approaches of the courts of different instances to interpret the same norms. The author also affects the issue of subsidiary liability of members of the board of directors in the framework of bankruptcy cases, and also discusses potential mechanisms for protecting the interests of minority shareholders. Methods of calculating bonuses and variability of intra-corporate regulations are revealed: from fixed payments to complex formulas taking into account participation in meetings, availability of profit, execution of additional functions, reference to dividend policy and other KPIs. The author offers a rethinking of universal approaches, promoted in the corporate governance code, insisting on the need for a differentiated approach, taking into account the specifics of the company, its property structure and position in the market. The article systematizes practice and identifies problem areas, and also offers recommendations for the formation of more stable and balanced mechanisms for material stimulation of members of the board of directors, taking into account the modern realities of corporate governance in Russia.

Journal of Modern CompetitionVol. 19(3)
Openalex Percentile: Top 71%
Legal Studies and Reforms
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