Directors' Liabilities for Corporate Debt

The issues

What are the responsibilities of a Chief Executive Officer (CEO) who is the majority shareholder of a company, if that company is no longer trading solvently and where goods have been purchased on credit from suppliers and payment for them has been fixed for a certain date. The supplier, realising that he is unable to count on getting his money back from the company, wants to know if he can claim the money from the CEO personally.

According to Jewish law what are the obligations upon the CEO?

The Jewish Perspective

The Chief Executive Officer is obliged to pay the company's debts from the company's funds, to the extent that its cash flow makes this possible. If there is no way that the company can repay the money, the supplier may collect from property that is owned by it.

However, under Jewish law, the CEO is not obliged to pay the debt from his own personal funds.