Exam 13: Corporate Governance in the Twenty-First Century

Codes of governance are ideal governance standards that all firms should follow.

Increasing the number of insiders on the board can increase the board's effectiveness.

Which of the following is not a true statement concerning the market for corporate control?

Incentive alignment may be used to solve the principal problem.

Which of the following statements is true concerning Germany's supervisory board?

Discuss the roles and actions of the board of directors.

The Public Company Accounting Oversight Board was created by the ________.

Compare and contrast insiders versus outsiders on a board of directors.

In the U.S., not all accounting firms that audit public companies have to register with the Public Company Accounting Oversight Board.

_____ stock ownership guidelines establish ownership through a multiple-of-salary approach.

All of the following are informal roles played by the board of directors except ________.

Discuss the pros and cons of board interlock.

The rationale for the use of stock options is that they motivate executives to ________ and take reasonable risks that result in the company's stock price increasing.

Discuss the effect of governance mechanisms on the survival and market capitalization of Internet-based companies launched in the U.S.

When firms are in relatively ________ competitive environments, the advice and monitoring of board members is enhanced when outside board members are drawn from other firms that are strategically related to the firm.

Discuss the differing corporate ownership roles and their impact on corporate governance.

A private firm is one in which the owner(s) has not listed shares of the firm on a public exchange.

Which of the following statements is true concerning U.S. public boards of directors?

When the roles of CEO and board chair are split, it is critical that the board chair take on some operational roles.

The interests of principals and agents generally overlap completely.