Any involvement in business is associated with the risk which a businessdecision may bring in terms of both gains and losses. Economic activities havebusiness cycles and fluctuations, so neither a constant and stable profit nor deals thatare always beneficial can be guaranteed. If directors were personally responsible forevery loss-making decision, this would ruin their initiative and entrepreneurship andlimit their discretion in situations requiring prompt and decisive action. However, ifdirectors were not subject to legal liability for damages incurred due to theirdecisions, this would increase the risk of directors adopting unlawful decisions.Therefore, it is important to find the golden mean between liability and freedom toadopt decisions. This article aims to present the rules applied in the Lithuanian legalsystem in liability cases against directors in the evaluation of risky business deci-sions. The research has shown that there is no explicit legal rule in Lithuaniancorporate law which provides for a business judgment rule, since the Lithuanianlegal system, like most legal systems in other countries with a civil law tradition,does not recognise the judicial abstention doctrine, which emphasises a court’s rightnot to considerex postcriticism of directors’ decisions. In Lithuania, there is notradition of litigation proceedings and rules formulated in judicial decisions

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• The Business Judgment Rule in Lithuani