Which three of the following attributes are identified by the Institute of Business Ethics as being typical of ethical business leaders?
In a market-based financial system, the financial system will be characterised by
In the country of Zanadu, the population has a risk seeking attitude towards financial matters. Zanadu's financial system is likely to be
Under a unitary board structure, a company's board of directors is responsible for both management of the business and reporting to
In both bank-based and market-based financial systems, financial intermediation is of increased importance because of its ability to address the market imperfection of
The agency problem is behind the need for sound corporate governance. The 'principal' in this agency relationship is
A consultant has made the following statements, which he maintains are drawn from the definition of corporate governance in the OECD's Principles of Corporate Governance.
Corporate governance comprises the practices and procedures for ensuring that a company is run in such a way that it achieves its objectives
Statement 2 Corporate governance is a set of relationships between a company's management, its board, its shareholders and other stakeholders
Do these statements match the definition?
Different corporate governance systems reflect different ways in which companies are managed and controlled by different board structures. The following statements have been made about the structure of a board of directors.
Statement 1 In the UK and Germany there is a unitary board system
Statement 2 A two-tier system comprises a management board and a supervisory board
Are these statements true or false?
Which of the following is one of the five OECD Principles of Corporate Governance?
The following statements have been made about ethical audits and corporate responsibility.
Statement 1 An ethical audit is a process which measures both the internal and external consistency of a company's values base
Statement 2 How far an organisation protects stakeholders with which it has contractual relationships is a measure of its corporate responsibility
Are these statements true or false?
The principal factor affecting the nature of business ethics over time is
A financial system comprises which three of the following?
The ability of markets to allocate resources efficiently within a financial system is often restricted by market imperfections.
Which three of the following are market imperfections associated with financial markets?
The body responsible for promoting high standards of corporate governance in the UK is the
Woolmer plc adopts corporate responsibility as a key element in its strategies. This will mean that the company seeks to
In seeking to address the problem of the separation of ownership and control, corporate governance attempts to align the interests of which two of the following stakeholders?
The stewardship approach to corporate governance requires directors of limited companies
The board of directors of Lake plc is concerned that the current Chief Executive's actions are undermining the ethical culture at the company. She fails to listen to the concerns of managers about unfair treatment of suppliers, and she has failed to learn from a recent scandal in which the company was fined for data protection breaches.
To improve the ethical culture at Lake plc, which of the following is the most important action for the board to take?
Protea plc manufactures sporting equipment for leisure centres. The Chairman is Jonathan Potter, and the Chief Executive is his daughter Elise. All of the directors receive bonuses based on annual profits. The company's sales are made by individual salespeople who routinely bypass the company's strict credit check procedures. A number of irrecoverable debts have arisen in the current year that would have affected profitability and the share price, if the Finance Director had not manipulated the accounts.
From this information, what are the likely corporate governance issues at Protea plc?
Which of the following is a list of the key elements of good corporate governance?
Ultra Zeta AG is a company based in Germany. The business has a dual board structure for its Board of Directors
Which of the following types of board forms part of the company's board structure?
The national culture in the country of Erewhon is characterised by a high ‘power distance’ score, and an acceptance that power is distributed unequally, and concentrated in the hands of a small number of key individuals.
By contrast, the country of Wenland has a lower ‘power distance’ score, and people strive to get power distributed more evenly.
Based on the ‘power distance’ scores of the two countries, identify if each of the following statements is likely to be true or false.
1 The corporate governance code in Erewhon prohibits the role of CEO and chair being combined, but the code in Wenland permits this.
2 The corporate governance code in Wenland requires a higher proportion of independent NEDs on the board than the code in Erewhon does.
Which of the following statements about whistle-blowing is/are true?
1 Whistle-blowing involves the disclosure by an employee of illegal or unethical behaviour in the workplace.
2 Employees should always report concerns about unethical behaviour to their line manager in the first instance.
Which three of the following are core aspects of South Africa’s King Report?
Goldenwood plc is a multinational company that makes sweets and sugary drinks targeted at children between the ages of 4 and 8 years old. The company regularly advertises its products during prime time children’s television programmes and on popular YouTube channels with high numbers of child subscribers. In recent weeks, the company has received adverse publicity because of its targeting of young children which has been branded as ‘unethical’.
Which business function is impacted by this ethical issue?
The agency problem concerns the misalignment in interests and conflicts of interest between:
In a company with weak corporate governance managers may be able primarily to pursue their own rather than the company's interests because, in relation to shareholders:
In comparison with the corporate and the public policy perspectives on corporate governance, the stakeholder perspective places least emphasis on:
Good practice in corporate governance requires that openness and transparency should be supported by:
In countries with a dual board structure, the supervisory board is elected by:
Business ethics are primarily moulded by the expectations of: