Oversight duty of board of directors regarding corporate governance

With the Turkish Commercial Code no. 6102, two compulsory bodies - the general assembly and the board of directors - have been stipulated for joint stock companies. Pursuant to the principle of equality between organs, each organ is given exclusive duties and powers. In various articles of the related Turkish Commercial Code, particularly the article 375, the duties and powers of the board of directors described as indispensable and non-transferable. Article 375/e of the Turkish Commercial Code sets out the exclusive duty and authority of the board of directors to ensure that the persons in charge of the management act in accordance with the laws, articles of association, internal directives and written instructions of the board of directors. In this respect, oversight is a duty and authority that may give rise to the responsibility of the board of directors, whether or not the management authority is delegated. Therefore, the board of directors is required to set up various senior oversight mechanisms/systems in order to avoid its responsibility arising from the said regulation. In this thesis, primarily the position of the board of directors in the Turkish Commercial Code system, the duty and authority area arising from this position and the oversight duty have been discussed in a manner related to the responsibility. What is the scope of the oversight, what is understood from the scope and elements, the effects on the general assembly and shareholders' rights and finally the relationship with the responsibility are discussed in detail.