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. Under SEC Regulation FD (Fair Disclosure), a public company is required to: → Simultaneously disclose material information to all investors if disclosed selectively
2. A company that adopts a 'long-term value creation' governance philosophy would MOST likely prioritize: → Investing in human capital, innovation, and sustainable practices
3. Which of the following is NOT a viable remedy for a breach of a contract to offer personal services? → A decree of specific performance
4. What is the primary concern when the CEO also serves as the Board Chair? → Lack of independent oversight of management
5. A company's code of ethics is MOST effective when it is: → Embedded in hiring, training, and performance evaluations
6. Which of the following actions by an activist shareholder is MOST consistent with legitimate corporate governance engagement? → Filing a shareholder proposal to separate the CEO and Chair roles
7. What would be a potential solution if a company wants to select more than 15 directors? → special resolution
8. Which SEC filing must activist investors use to publicly disclose an ownership stake exceeding 5% with intent to influence the company? → Schedule 13D
9. 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
10. The concept of 'entire fairness' review in Delaware corporate law applies most directly when: → A conflicted transaction is approved without adequate independent oversight
11. What is the purpose of an executive session of the board? → To allow non-management directors to meet without management present
12. Current asset management is referred to as → Current asset management and Working capital management
13. Which of the following is not one of the corporate governance Combined Code of Practice's guiding principles? → acceptability
14. What framework is most widely used for evaluating internal controls over financial reporting? → COSO Internal Control – Integrated Framework
15. Which type of institutional investor is most commonly associated with 'activist' governance campaigns? → Hedge funds that acquire significant stakes to push for strategic or governance changes
16. What is a 'dual-class share structure'? → A capital structure where certain shares carry more voting rights than others
17. A CFO proposes switching from LIFO to FIFO inventory accounting during a period of rising prices. What is the most likely governance concern? → The change could inflate reported earnings and may be motivated by short-term incentives
18. What is the SEC's 'Howey Test' used to determine? → Whether an instrument qualifies as a security subject to SEC registration requirements
19. A board compensation committee ties executive bonuses exclusively to annual EPS growth. What financial governance risk does this create? → Executives may be incentivized to cut R&D or buy back shares to boost EPS short-term
20. Which committee is primarily responsible for overseeing financial reporting and internal controls? → Audit Committee
21. The agency debt issue includes the following: → The shareholders expropriating the debtholders.
22. Which SEC rule requires companies to adopt and enforce clawback policies for listed companies? → Rule 10D-1 under Dodd-Frank
23. What is 'say on pay' as established by the Dodd-Frank Act? → A mandatory shareholder vote to approve executive compensation packages
24. Which SEC form must public companies use to file their annual report? → Form 10-K
25. What is a 'consent solicitation' in corporate governance? → A process allowing shareholders to act by written consent without a formal meeting
26. The 'say on pay' provisions introduced by the Dodd-Frank Act give shareholders the right to: → Cast a non-binding advisory vote on executive compensation packages
27. The 'say-on-golden-parachute' vote required by Dodd-Frank applies specifically to: → Compensation arrangements triggered by merger or acquisition transactions
28. Which of the following can contribute to effective governance? → all of the above
29. Which governance principle is most directly supported by requiring a separation of the CEO and Board Chair roles? → Independence
30. What does the 'say-on-pay' provision under Dodd-Frank require? → Shareholders vote on executive pay packages at least every three years