<![CDATA[A limited liability company operates through three interrelated organs: the General Meeting of Shareholders, the Board of Directors, and the Board of Commissioners, each with distinct functions. This study examines whether the broad managerial and representative authority of the Board of Directors creates a risk of power domination and whether the legal framework provides effective checks and balances. Using a normative juridical method with statutory and conceptual approaches, the study analyzes Law Number 40 of 2007 concerning Limited Liability Companies, fiduciary duty, the business judgment rule, and good corporate governance principles. The study finds that although directors possess broad authority, legal safeguards include transaction approval requirements, directors’ personal liability, minority shareholders’ derivative actions, and the Commissioners’ power to temporarily suspend directors. The business judgment rule further recognizes the uncertainty inherent in business decisions. Ultimately, these mechanisms are normatively adequate, but their effectiveness depends on the independence of the Board of Commissioners and the active use of available legal remedies.]]>
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