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WorksheetsTopic 6 - Corporate Governance
Total questions: 10
Worksheet time: 10mins
Which of the following statements about corporate social responsibility is true?
(i) CSR guarantees increased profit levels
(ii) CSR adds cost to organisational activities and reduces profit levels
(iii) Social responsibility may have commercial benefits
(iv) Social responsibility is a concern confined to business organisations
(i), (ii), (iii) and (iv)
(i) and (iii)
(ii) and (iv)
(iii) only
Calum, Heidi and Jonas are managers for Zip Co. They have been told that their salary will be based on company performance and that a bonus scheme will also be introduced. The bonus will also be related to company performance. Which of the following best describes the approach to governance that Zip Co is using?
Stewardship theory
Agency theory
Stakeholder theory
Michael has been asked to prepare a presentation for the company directors on good corporate governance. Which one of the following is he likely to exclude from his presentation?
Risk management
Internal controls
Maximising shareholder wealth
Accountability to stakeholders
Corporate governance is essentially a control system: it is not considered of strategic importance. Is this statement true or false?
True
False
The tasks of which body include: monitoring the chief executive officer; formulating strategy; and ensuring that there is effective communication of the strategic plan?
The audit committee
The Public Oversight Board
The board of directors
The nomination committee
Which of the following would be included in the principles of Corporate Social Responsibility?
(i) Human rights
(ii) Employee welfare
(iii) Professional ethics
(iv) Support for local suppliers
(ii) and (iii) only
(i) only
(ii), (iii) and (iv) only
(i), (ii) and (iv) only
Which of the following is subject to the least direct regulation?
Employment protection
Corporate social responsibility
Professional ethics
Corporate governance
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 the best practice that companies should adopt
To provide a comprehensive framework for management and administration
Which of the following is a feature of poor corporate governance?
Domination of the board by a single individual
Critical questioning of senior managers by external auditors
Supervision of staff in key roles
Lack of focus on short-term profitability
Which of the following is a key benefit of implementing effective corporate governance?
Enhanced reputation and trust
Increased employee turnover
Higher operational costs
Reduced stakeholder engagement
