7.1 Corperate governance, responsibility and ethics

Question 1

what is agency theory?

Answer 1

managers of a business act as agents for the owners of the business. and agents do things for themselves rather than for the owners/shareholders

Question 2

what are the other symptoms of poor corporate governance?

Answer 2

domination of the board
no involvment by theboard
inadequate control of function
lack of supervision of employees
lackof independent scrutiny b external or internal auditors
lack on contact with shareholders
short term profitability
misleading financial statements

Question 3

corperate governance?

Answer 3

a structred system for the direction and control of company that:

1. specifies the distribution of rights nd responsibilities b/wstakeholders (SHs, board of dirs and management)
2. established rules and procedures or making decisions about the companies affairs.

Question 4

the 4 main persectives of corperate governance

Answer 4

corperate - maxiamise wealth of shareholders
public policy - SH +SkHs +public
Stakeholder - resources,accountability,
stewardship- act in the best interests of the compnay

Question 5

Good practice in corperate governance is concerned with?

Answer 5

Openness and transparency
integrity adn acountability
reducing the potential for conflict
Reconciling the interetsts.

Question 6

what are the principles of the stewardship code for institutional investors

Answer 6

1 - publicly disclose their policies
2- have a robust policy on managing conflicts of interest in relation to stewardship + publicly disclosed
3 - monitor their investee companys
4 - establish clear guidelines (protecting shareholder value)
5 - act collectively with the investors where appropriote
6 - clear policy on voting and disclosure f voting activity
7 - report periodically on their stewardship and voting activities

Question 7

what are Philipa Foster Backs atttributesnd behaviours ofethical leaders

Answer 7

openess 
courage
fai minded
ability to listen
honesty

Question 8

what are the key sustainability goals in business

Answer 8

provide decent work and economic growth

industry, innovation and infrastructure.