Good Governance Quiz 2 (Part 3)

Question 1

why be “_______”? simply because the success or failure of an organization rest on the board and the board should be “_______” not only to their stakeholders but also to all other stakeholders affected by their action/behavior.

Answer 1

Accountability

Question 2

Another function of the board is to oversee the performance of its management. there are various financial and nonfinancial metrics available but most companies prefer to use financial metrics as it is readily quantifiable such as sales, net income, financial ratios and others.

Answer 2

Monitoring and Supervising

Question 3

for strategies to work, a set of policies, procedures and plans must be prepared for management to abide by. this is also used to supervise management activities.

Answer 3

Setting Policy

Question 4

this is the most important function of the board as this will steer the company to achieve its vision and mission.

Answer 4

Strategy Formulation

Question 5

“(1)_________” and “(2)___________” are outward-looking whereas “(3)_________” and “_________” are inward looking.

Answer 5

1. Accountability
2. Formulating Strategy
3. Monitoring and supervising

Question 6

the time reference for “__________” and “________” and “_________” refers to both historical and current period.

Answer 6

Accountability and Monitoring and supervising

Question 7

“_________” and “___________” are future-focused activities

Answer 7

Strategy formulation and Policy making

Question 8

is determined by the current board and should comply with the terms established by laws of corporation.

Answer 8

Board Size (one director up to maximum of 15)

Question 9

are nominated by the shareholders, controlled by the board in the director selection process as best practices indicate.

Answer 9

Directors

Question 10

3 main director types (Membership of the board)

Answer 10

1. independent
2. non executive
3. executive

Question 11

are individuals who have no connection with the company and is free from any relationship which may be considered a conflict of interest.

Answer 11

Independent directors

Question 12

are individuals who are not part of management but related to a certain aspect of the company, such as being a supplier, family representative, friend, adviser or shareholder.

Answer 12

Non-executive directors

Question 13

holds a particular executive position inside the organization, such as the CEO or other senior executive positions such as vice president.

Answer 13

Executive

Question 14

a director must have the following core competencies:

Answer 14

1. Good communication skills
2. ability to read and understand financial statements.
3. strategic planning
4. critical thinking and networking