Directors and Officers Liability Insurance
Page 81
5
SOURCES OF LIABILITY AND THE CONSEQUENTIAL LOSS: D&O COVERED RISK
I. THE RELATIONSHIP BETWEEN THE COMPANY AND ITS DIRECTORS
5.1
In terms of defining the relationship between a company and its directors, there are two competing theories, viz. “the “organic”1 and “agency” theories. English case law has, in the main, endorsed the former.2