RCC Corporate Governance and Board Oversight Flashcards
6 cards from real RCC practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 RCC Corporate Governance and Board Oversight flashcards as text
What is the MAIN compliance function of a company's code of conduct?
Answer: To establish the ethical standards and behavioral expectations for everyone in the organization
A code of conduct articulates the organization's values, ethical standards, and expected behaviors, serving as the foundational compliance document that guides employee decision-making.
Under the Federal Sentencing Guidelines for Organizations, an effective compliance and ethics program can:
Answer: Mitigate fines and penalties if a violation does occur
The Federal Sentencing Guidelines reward organizations that have effective compliance programs with reduced culpability scores, potentially leading to significantly lower fines when violations occur.
What is the difference between 'interested director transactions' and 'arm's length transactions' in corporate governance?
Answer: Interested transactions involve a director with a personal stake in the outcome; arm's length transactions are between independent parties
Interested director transactions raise conflict-of-interest concerns because the director stands to personally benefit, requiring special board scrutiny; arm's length transactions do not carry this conflict.
Proxy statements (Form DEF 14A) are filed with the SEC PRIMARILY to:
Answer: Disclose information shareholders need to vote on corporate matters including director elections and executive compensation
Proxy statements provide shareholders with the information needed to vote on matters such as director elections, say-on-pay votes, and other shareholder proposals at annual meetings.
A company's 'related party transactions' policy PRIMARILY addresses situations where:
Answer: Corporate insiders or their affiliates transact business with the company in a way that may benefit the insider
Related party transaction policies govern dealings between the company and its executives, directors, or their family members to ensure such transactions are fair, disclosed, and approved by disinterested parties.
The Dodd-Frank Act introduced which corporate governance requirement for public companies?
Answer: Non-binding shareholder advisory votes on executive compensation (say-on-pay)
Dodd-Frank's say-on-pay provision requires public companies to hold non-binding shareholder votes on executive compensation at least every three years, increasing transparency and accountability.