Governance, Ethics, Risk Management and Internal Control Pre-Fin

What is the primary purpose of governance in organizations?

• To increase marketing efforts

• To ensure operational efficiency

• To set direction and control to achieve objectives

• To reduce staff turnover

Which of the following is NOT a principle of good governance?

• Transparency

• Accountability

• Monopoly

• Fairness

Which theory focuses on aligning the interests of owners and managers?

• Stakeholder Theory

• Stewardship Theory

• Institutional Theory

• Agency Theory

Stewardship Theory assumes that managers are:

• Opportunistic and self-serving

• Committed to the success of the organization

• Primarily accountable to shareholders

• Motivated by external incentives only

Which of the following is emphasized in Stakeholder Theory?

• Sole focus on shareholders

• Maximizing executive salaries

• Considering all parties affected by organizational actions

• Reducing board independence

The evolution of corporate governance practices has been influenced by:

• Technological stagnation

• Deregulation of industries

• Corporate scandals and globalization

• Decreased shareholder interest

Governance affects organizational culture by:

• Promoting uniform behavior across all firms

• Reinforcing values and expected behaviors

• Eliminating all risk

• Standardizing all international operations

The board of directors is primarily responsible for:

• Day-to-day management

• Strategic oversight and accountability

• Implementing project plans

• Conducting audits

Board independence refers to:

• Board members being full-time employees

• Board members having no vested interests

• Board members working remotely

• Boards operating without any committees

Which board committee oversees financial reporting?

• Nomination Committee

• Compensation Committee

• Audit Committee

• Governance Committee