HSE CG Quiz 2 Models of CG

The main reason why several types of CG models can be distinguished among contemporary corporations:

• Cultural differences in doing business around the world

• Differences in management and BoD objectives around the world

• Differences in shareholders preferences around the world

• The existing differences between democratic and non-democratic countries

Models of Corporate Governance identify:

• The regulatory framework of stakeholders’ interaction

• The taxation policy of the company

• Requirements to managers’ qualification

• Disclosure requirements

Equity financing is the main source of funding for companies following:

• Russian model

• Japanese model

• German model

• Anglo-American model

Which one of the following models tends to emphasize the value of main stakeholders of the business:

• Russian model

• Japanese model

• German model

• Anglo-American model

Keiretsu being a network governance structure implies:

• Cross-directorship

• Wide inclusion of independent directors

• Transparency to its members

• High public disclosure

Anglo American model of corporate governance is surely characterized by:

• Active participation in financial markets

• Orientation to banks as the main capital provider

• High presence of independent directors in the board

• Corporate governance is rule based rather than principle based (GAAP vs IFRS)

Which one is NOT true regarding Continental model of CG

• Financial Markets tends to be smaller and less liquid

• Labor unions are represented

• Two tier boards are adopted by most listed companies

• Supervisory boards consist of powerful executive directors

German model of corporate governance is surely characterized by:

• Dispersed shareholding

• Employees interests’ consideration

• Insignificant role of the stock market as an external controlling body

• Low degree of information transparency

Choose the committees which listed companies should certainly have within the Board

• Audit leaded by independent director

• Nomination leaded by CEO

• Governance leaded by NED with potential interest in joint project

• Compensation leaded by independent director

Typical director in the US company’s board keeps position over five years and earns more than 25,000 USD per meeting

• TRUE

• FALSE