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Corporate Gorvernance > Chapter 2 The board > Flashcards

Chapter 2 The board Flashcards

1
Q

Functions and characteristics of the board of directors :

A

Functions :
- control
- Provision of resources

Characteristics :
- size
- independence
- diversity

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2
Q

Key responsabilities of the board of directors

A
  • Selecting the CEO
  • Tone at the Top
  • corporate strategy & monitoring
  • Risk appetite & management process
  • Allocating Capital
  • Reviewing operating plans, budget and business resiliency
  • compliance program
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3
Q

True or False : The board of Directors Focusing on the integrity and clarity of the company’s financial reporting and other
disclosures about corporate performance.

A

TRUE

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4
Q

Nominating directors and committee members, and overseeing effective corporate
governance. its a key responsabilities of Who ?

A

The Board of Directors

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5
Q

Functions of The Board of Directors :

A
  • Providing Legitimacy & Public Image
  • Expertise
  • Advice and counsel
  • Deal with Stakeholders
  • access to resources
  • External relations
  • Important firm decisions
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6
Q

What is Board Capital ?

A

Human capital & Relational or Social Capital

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7
Q

What is the 3 Board’s Structures ?

A
  • Unitary board
  • Two-tier board
  • Mixed system
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8
Q

Explain the Unitary Board structures

A

Single Board of Directors comprising Non-Executive and Executive directors

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9
Q

Explain the Two-tier board structures

A

Management board & Supervisory board (non-executive directors only)

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10
Q

True or False ?
The chairman is the highest-ranking officer of the corporation and the main
representative

A

TRUE

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11
Q

Main functions of the CHAIRMAN is:

A
  • objective judgement
  • ethical leadership
  • Chair the board and general meetings
  • Succession planning
  • effective decision- making processes of the board
  • Promote company culture
  • Build relationship between NED and ED
  • effective communication with shareholders
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12
Q

Who is in charge of initiate regular reviews of the board and its committees ?

A

The Chairman

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13
Q

The CEO are responsable of :

A

Business operations
Strategic planning
Capital allocation
Identifying, evaluating and managing risks
Accurate and transparent financial reporting

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14
Q

Who is in Charge of Selecting qualified management, establishing an effective organizational structure
and ensuring effective succession planning ?

A

The CEO

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15
Q

What is a Non-executive Chairman ?

A

It’s when the positions of CEO and chairman are not
combined and are not carried out by the same person.

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16
Q

What is the Advantages of a Non-executive Chairman ?

A
  • clearer separation between the board and management
  • eliminates certain conflicts
  • Clear authority to one director
  • CEO have time to focus on the strategy
17
Q

Disavantages of non-executive chairman ?

A
  • can make recruiting a new CEO difficult
  • Duplication of leadership & internal confusion
  • Costs decision
18
Q

Lead Independent Director key responsabilities :

A
  • Point of contact for shareholders & stakeholders
  • balanced understanding of major shareholder issues and
    concerns.
  • Link between independent directors
  • Replaces the chairman in the event of absence
19
Q

Who Assist the chair with the process for the selection of a new chair, as appropriate,
and chair the Nominations & Corporate Governance Committee when agreeing the
recommendation to the board for the chair’s successor ?

A

The Lead Independent Director

20
Q

True or False : The secretary need to be a lawyer

A

False,

21
Q

Who act like a “legal advisor”

A

The Board Secretary

22
Q

Approximative size of a Board ?

A

between 5 and 15 members

23
Q

Why Director independence is critical to effective corporate governance ?

A

Because, ID providing
objective independent judgment

24
Q

Did Diversity of the Board only refer to Gender and ethnicity ?

A

NO, The composition of a board should reflect a diversity of thought, backgrounds, skills,
experiences and expertise

25
Q

What helps to assess the diversity of skills, experience of the board of directors ?

A

A Skill Matrix

26
Q
A

Corporate Gorvernance (9 decks)

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