CEP Governance Structures & Ethical Practices 3

Question 1

What is 'say on pay' in the context of corporate governance?

Accepted Answer

A shareholder vote on executive compensation packages

Answer

'Say on pay' is a shareholder advisory vote that allows investors to approve or reject a company's executive compensation program.

Question 2

Which ethical framework emphasizes that decisions should be made based on universal rules applicable to everyone, regardless of outcomes?

Accepted Answer

Kantian deontology

Answer

Kantian deontology holds that actions must follow universal moral rules (categorical imperatives) regardless of their consequences.

Question 3

A company discovers its supplier uses child labor. Under the UN Guiding Principles, what is the company's first obligation?

Accepted Answer

Conduct human rights due diligence and work to remediate the harm

Answer

The UNGPs require companies to conduct due diligence and remediate adverse human rights impacts, which may involve working with suppliers rather than immediate termination.

Question 4

What does 'dual-class share structure' mean in governance terms?

Accepted Answer

Different share classes carry different voting rights, often concentrating control with founders

Answer

Dual-class share structures give certain shareholders (usually founders) superior voting rights, concentrating governance control despite having fewer economic shares.

Question 5

Which organization publishes the OECD Principles of Corporate Governance used internationally as a benchmark?

Accepted Answer

Organisation for Economic Co-operation and Development

Answer

The OECD publishes its Principles of Corporate Governance, which serve as an international standard referenced by regulators and companies worldwide.

(CEP) Certified Environmental, Social, and Governance (ESG) Planner Practice Test

(CEP) Certified Environmental, Social, and Governance (ESG) Planner Practice Test

CEP Governance Structures & Ethical Practices 3