Blank response choices:

1) tomatoes / carrots / celery

2) sticks / stocks / stones

3) positive / negative

4) punish / promote / reward

5) more / less

Corporate governance refers to policies and rules, regulations and laws, and activities that (1) influence both management's decisions and its company's operations, and (2) affect the relationships between a business's stakeholders. These stakeholders include the company's executives and managers, shareholders, creditors, current and former employees, competitors, and local and global communities. and reinforcement for undertaking In simple terms, corporate governance provisions can take two forms: activities that are beneficial to the firm's stakeholders, and the latter intended to , with the former intended to provide management for its undesirable decisions or actions. These governing forces are both internal and external to the organization, and can either align management's interests with those of their shareholders (a positive outcome) or further entrench the firm's management (a not-so-positive outcome). An entrenched management is one that is likely to be removed, all other things remaining equal. Internal and external corporate governance provisions and activities can take many forms, including a targeted share repurchase provision. Which of the following best describes this technique? This method of resisting a takeover involves the repurchase of shares from a firm threatening a hostile takeover. This anti-takeover tactic requires the firm to automatically confiscate and sell the shares of an individual shareholder who owns more than a specified amount of a target company's stock This procedure for facilitating a takeover and changing a firm's management involves repurchasing, for a fraction of their market value, the shares owned by the firm's board members. If you were designing the composition and acceptable practices for the board of directors of a new corporation, which of the following practices would you suggest be implemented? Suggested Practice Yes, recommend implementation No, do not recommend implementation Members serving on the board's audit committee should be "independent." The company's charter should not contain a restricted voting rights provision. Board members and senior management should be compensated solely with cash, and any compensation received should be independent of the company's riskiness. Senior management's cash bonuses should be tied solely to the firm's short-term share-price performance