MEXICO Law and Practice Contributed by: Allan Kaye Trueba, Mariana Santillán Trejo and Rebeca Sanchez, Aziz & Kaye Abogados, S.C.
that such acts are not fraudulent, in bad faith, or unlawful. A recent ruling by the Mexican Supreme Court has changed the framework concerning direc - tors’ civil liability in Mexico and confirmed that there is a pathway for individual actions, under civil law. See 2.1 Hot Topics in Corporate Gov- ernance for more information. 4.10 Approvals and Restrictions Concerning Payments to Directors/ Officers Remuneration of the members of the board of directors may be determined in the company’s by-laws. In their absence, the ordinary share - holders’ meeting shall determine such remu - neration. In publicly listed companies, the board of direc - tors must approve the remuneration for the chief executive officer and the guidelines for appoint - ing and compensating other high-ranking offic - ers. Members of the board of directors shall receive no payment that may be considered to breach their duty of loyalty or any other of their duties. 4.11 Disclosure of Payments to Directors/Officers Private companies are not required to disclose the compensation or any other amount paid to their directors or officers. For public disclosure, publicly listed companies shall deliver to the National Banking and Securi - ties Commission and the corresponding stock exchange, periodic reports, including informa - tion concerning the chief executive officer’s compensation and guidelines for appointing and compensating high-ranking officials.
Public listed companies’ annual reports that are disclosed to the public provide information on the aggregate compensation paid to the board of directors and other high-ranking officers of the company. 5. Shareholders 5.1 Relationship Between Companies and Shareholders The shareholders are the owners of the com - pany. The relationship between the shareholders and the company is governed by law, the provi - sions of the company’s by-laws, and, if applica - ble, by any shareholders’ agreement. While transparency requirements related to shareholding structure have increased in recent years, there is no fully public, universally accessi - ble registry of all company shareholders. Certain information about shareholders of publicly listed companies is more accessible due to disclosure requirements under securities regulations. See 5.5 Disclosure by Shareholders in Publicly Traded Companies for more information. 5.2 Role of Shareholders in Company Management Shareholders are not required to participate in the company’s management. Directors may or may not be shareholders. If the shareholders are not members of the board of directors, they may not be able to direct the management of the company unless they have the right to appoint a member of such a body. Besides appointing a member of the manag - ing body, shareholders may have an impact or influence on the actions of the business by exercising the corporate rights that they are enti - tled to depending on the percentage of shares
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