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Jeorjeana L. Manguerra
45502
GOOD GOVERNANCE ACTIVITY #1
Exercise 1 SHORT ANSWER

Describe the broad role of Board of Directors.
Board of Directors exercises the corporate powers of a corporation and are the one that
conducts all its business and controls its properties. Their role also includes hiring of the
CEO or general manager of the business and assess the overall direction and strategy
of the business and lastly it is their responsibility to develop a governance system within
an organization.

On what aspects do shareholders demand accountability from the Board of Directors?
Since shareholders are the owner of the company and they are the one who elected the
Board of Directors, they held the Board of Directors accountable for their company’s
business operations and corporate governance as well as the maximization of their
wealth while also taking into account the benefits of other stakeholders.
Exercise 2 IDENTIFICATION
1. Approving financial reports and other public documents are responsibilities of? BOARD
OF DIRECTORS
2. Responsible for the audit of the companies for compliance of policies and laws, audits
efficiency and test of controls. AUDITOR
3. Responsible for the effective management of operations. MANAGEMENT
4. They are anyone that can be influenced, directly or indirectly, by the actions of the
companies. STAKEHOLDERS
5. They provide oversight of internal and external audit function. AUDIT COMMITTEE
Exercise 3 ESSAY
“Maximizing shareholders’ wealth must always be the priority.” Must the other stakeholders’
interest be compromised to achieve this?
Maximizing shareholders’ wealth must always be the priority but that doesn’t necessarily
mean that the other stakeholders’ interest must be compromised in order to achieve it. As we all
know there are different types of stakeholders, these are the customers, investors, employees,
suppliers, communities and the government. These stakeholders have a great contribution on
the success of one’s business or let’s say on the maximization of shareholders’ wealth. The great
contribution of these stakeholders are their actions in which a certain business is so dependent,
that is why a business organization must always align their interest to these stakeholders’ interest
in all its activities. Also, corporate social responsibility must always be in practice because it
benefits us all. To conclude this, a mutually beneficial relationship with all stakeholders will
generate goodwill toward a certain business, which will lead to lasting success.
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