BT Ch-5 Corporate Governance

Stewards are the owner of a company. They are not accountable to anyone.

• True

• False

Shareholders of the company can dismiss the steward or the executive management of the company.

• True

• False

Shareholder of the company received relevant information of the company by …………………………….. Source.

• News papers and magazines

• TV or News channels

• Emails or by stock exchanges

• Audited accounts / annual reports.

Agency theory of management states that managers …………………………………………………….

• Should manage the organization that will benefit the stake holders

• Should manage the organization that will benefit the Shareholders only

• Management seeks to service their own interest and only look after the performance of the company.

• Manager has the duty of care, for all the stake holders and share holder of the company.

………………………… states that management has a duty of care, not just to the owners of the company in terms of maximizing shareholder value, but also to the wider community of interest, or stakeholders.

• Stewardship theory

• Agency Theory

• Stakeholder theory

• Governance theory.

…………………………… is the system by which organization are directed and controlled by senior officers or management.

• Procedure

• M I S

• Corporate governance.

• Operational management.

Which of the following is not the feather of poor corporate governance?

• Dominate by single individual / Lack of involvement of the board

• Lack of adequate control function / Lack of supervision

• Lack of independent scrutiny / lack of contact with shareholders

• None of the Above.

In few cases it is observed that Board is dominated by a single senior executive while other members merely acting like a rubber stamp.

• True

• False

In most countries, what is the usual purpose of codes of practice on corporate governance?

• To establish legally binding requirements to which all companies must adhere

• To set down detailed rules to regulate the ways in which companies must operate

• To provide guidance on the standards of best practice that company should adopt

• To provide a comprehensive framework for management and administration

The performance of the Director in the board cannot be assessed by the board.

• True

• False