Summary: Slides Corporate Governance

Read the summary and the most important questions on Slides Corporate Governance

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• What are the 4 factors on which Fama & Jensen 1983 write in their article about Manage & Supervise

  1. Initiation - Generation of proposals for resource utilization and structuring contracts
  2. Ratification - Choice of the decision initiatives to be implemented
  3. Implementation  - execution of ratified decisions
  4. Monitoring - measurement of the performance of decision agent and implementation of rewards

• What is the aim of corporate governance

  Continuity of the firm

• What is the objective of corporate governance

  Realising long term shareholder value while taking into account interest of all stakeholders

• What is feasibility space

  4 rounds where there is 1 space where they all are linked which is seen as an ideal world. As soon as the feasibility space increases, it decreases again to make sure all stakeholders get their fair share.

• Dutch corporate governance code

  - focus on long term value creation
  - risk management reinforcement
  - new accents in effective management
  - remuneration cleaned up and simplified
  - relationship with shareholders

• Dutch corporate governance code in chapter topics

  - Compliance with and enforcement of code
  - management board
  - supervisory board
  - shareholders 
  - financial statement audit

• Dutch corporate governance code focus points

  - realization of objectives, strategu and policy
  - internal risk control systems
  - quality / completeness of published FS

• What is the backbone of good CG?

  Transperancy
  

  1. transperancy forms backbone of good CG and sophisticated system of accounting. 

  
  

  • allows investors to assess the magnitude and timing of future cash flows to be generated by business 
  • Efficient operations
  • provide early warning
  • lead to quick correction

• What is the role of customers in CG?

  • Firms cant exist without
    
  • formal influence is limited, informal influence is big (when customers dont buy from firm, firm dies)

• What is the role of shareholders in CG?

  • Shareholders take chance to participate in profits of firm without taking responsibility for operatiosn
    
  • Limited liability in affairs
  • right to elect directors and for management to protect their own interst

  
  
  shareholders have voting, information and approval rights