Following the financial crisis, major debates arise on the use of legal sanction to keep company directors in line with corporate governance. This dissertation positions directors- liability as a corporate governance instrument; foremost affected by (stakeholders of) the company, significantly affected by courts. Legal (comparative) and empirical research brings strong analysis and arguments to improve directors- liability legislation and understanding of its potential to induce directors- good practices. Confronting legal doctrine and positive law with empirical reality, this dissertation sharply identifies when the boundary of directors- business judgment opens for judicial scrutiny. Research I demonstrates how directors are affected by directors- liability risks. Research II identifies factors of when directors are being held personally liable by courts. Research III demonstrates poor corporate governance regarding discharge from personal liability for directors- bad faith actions by means of an informed shareholders- resolution. Results, conclusions and propositions are founded on over 50 interviews with executive and supervisory directors, extensive qualitative and quantitative case law analysis (2003-2013), comparative legal analysis (Netherlands-Delaware) and legal and social literature study.