Corporate Governance Cheat Sheet 2026

The 30 highest-yield Corporate Governance facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.

1. Which of the following is NOT a viable remedy for a breach of a contract to offer personal services? → A decree of specific performance
2. What is the primary concern when the CEO also serves as the Board Chair? → Lack of independent oversight of management
3. What would be a potential solution if a company wants to select more than 15 directors? → special resolution
4. Which SEC filing must activist investors use to publicly disclose an ownership stake exceeding 5% with intent to influence the company? → Schedule 13D
5. What is a 'white knight' in the context of hostile takeovers? → A friendly acquirer sought by the target company's board to avoid a hostile bid
6. The concept of 'entire fairness' review in Delaware corporate law applies most directly when: → A conflicted transaction is approved without adequate independent oversight
7. What is the purpose of an executive session of the board? → To allow non-management directors to meet without management present
8. Current asset management is referred to as → Current asset management and Working capital management
9. Which of the following is not one of the corporate governance Combined Code of Practice's guiding principles? → acceptability
10. What framework is most widely used for evaluating internal controls over financial reporting? → COSO Internal Control – Integrated Framework
11. What is a 'dual-class share structure'? → A capital structure where certain shares carry more voting rights than others
12. What is the SEC's 'Howey Test' used to determine? → Whether an instrument qualifies as a security subject to SEC registration requirements
13. Which committee is primarily responsible for overseeing financial reporting and internal controls? → Audit Committee
14. The agency debt issue includes the following: → The shareholders expropriating the debtholders.
15. Which SEC rule requires companies to adopt and enforce clawback policies for listed companies? → Rule 10D-1 under Dodd-Frank
16. What is 'say on pay' as established by the Dodd-Frank Act? → A mandatory shareholder vote to approve executive compensation packages
17. Which SEC form must public companies use to file their annual report? → Form 10-K
18. What is a 'consent solicitation' in corporate governance? → A process allowing shareholders to act by written consent without a formal meeting
19. Which of the following can contribute to effective governance? → all of the above
20. What is 'board refreshment' in corporate governance? → The process of adding new directors to bring in fresh perspectives and skills
21. Under the Revlon doctrine, a board's primary obligation shifts to maximizing short-term shareholder value when: → The company enters a change-of-control transaction
22. Under Delaware law, which party bears the burden of proof when a plaintiff challenges a board decision protected by the Business Judgment Rule? → The plaintiff shareholder
23. Which compensation element is most directly linked to short-term company performance? → Annual bonus (short-term incentive)
24. Under the Sarbanes-Oxley Act, how many members of the audit committee must be 'financial experts'? → At least one
25. Which metric is most commonly used in long-term incentive plans to measure shareholder value creation? → Total shareholder return (TSR)
26. Which corporate governance model separates the roles of CEO and Board Chair? → Split leadership model
27. What does 'cumulative voting' allow shareholders to do? → Concentrate all votes on a single director candidate to elect minority representation
28. What does 'director independence' primarily mean in US corporate governance? → The director has no material relationship with the company that could impair objectivity
29. In order for moral hazard to occur, there must be → Asymmetry of information
30. What is the primary purpose of equity-based executive compensation? → To align executive interests with long-term shareholder value creation