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NAME: Dr. SHAHNAZ PARVEENDEPARTMENT: MANAGEMENTCOLLEGE; UMESCHANDRA COLLEGE, SALT LAKE CAMPUSSUBJECT: BUSINESS ETHICSSEMESTER: IV (2 Year)UNIT- 4 CORPORATE CULTURE(MCQ)Que: 1 The foundation for corporate culture are laid bya.b.c.d.Corporate membersCompetitorsFoundersIndustry standardAns: (c)Que: 2 An organization’s embraces the behavior, rituals andshared meaning held by employees that distinguishes the organization from allothers.a.b.c.d.External environmentCultureDominant cultureEthicsAns: (b)Que: 3 Components of corporate culture includesa. Vision and values

b. Practices and peoplec. Narrative and placed. All of theseAns: (d)Que: 4 Commitment, competence and consistency are three distinct characteristicsthat result ina.b.c.d.Culture buildingValuesOrganizational socializationAttitudesAns: (a)Que: 5 Types of corporate culture area.b.c.d.Clan culture and Adhocracy cultureMarket culture and hierarchy cultureBoth (a) & (b)None of theseAns: (c)Que: 6 The practices of a company for which it is accountable in relation to otherparties is calleda.b.c.d.Social responsibilityCode of EthicsValuesCultureAns: (a)Que: 7 Culture needs to be kept alive bya. Workersb. Salesmanc. Top managers

d. Human resource managersAns: (c)Que: 8 National culture is based ona.b.c.d.LanguageThe territory of the stateThe sense of belonging of a peopleThe nation-state.Ans: (c)Que: 9 A low context culture isa.b.c.d.A culture where much goes unsaidA culture in which communication is clear and directA culture where ambiguity is the norm, and directness is avoidedA culture in which body language and ‘reading between the lines’ areimportantAns: (b)Que: 10 Characteristics of organizational culture include all but which one of thefollowing?a.b.c.d.Common language, terminology and norms of behaviorSustainability policiesPreference for formal or informal communicationRulebook of do’s and don’ts for staffAns: (b)

UNIT- V CORPORATE GOVERNANCE(MCQ)Que: 1 The primary stakeholders Ans: (c)Que: 2 The corporate governance structure of a company reflects the individualcompaniesa.b.c.d.Cultural & economic systemLegal & business systemSocial& regulatory systemAll of theseAns: (d)Que: 3 Corporate governance is a form ofa.b.c.d.External regulationSelf regulationGovernment controlCharitable actionAns: (b)Que: 4 CSR & corporate governance represent a -------- between business andsociety.a.b.c.d.Social climateSpecial contractSpecial climateSocial contractAns: (d)

Que: 5 the framework for establishing good corporate governance & accountabilitywas originally set up bya.b.c.d.Rowntree CommitteCadbury CommitteeNestle CommitteeThornton CommitteeAns: (b)Que: 6 ------ may be defined as the enhancement of long-term shareholders whileat the same time protecting the interests of other stakeholders.a.b.c.d.Business ethicsB. CSRCultural relativismCorporate governanceAns: (d)Que:7 Which of the following is/are feature of corporate governance?a.b.c.d.Non- universalityAccountabilityAmbiguityNone of theseAns: (b)Que:8 There are usually key participants in corporate governance.a.b.c.d.ThreeFourFiveEightAns: (a)Que: 9 Corporate governance is a approach.a. Top-down

b. Bottom-upc. Hybridd. ScientificAns: (a)Que: 10 Corporate governance is concerned with the formation of term objectivea.b.c.d.Very shortShortMediumLongAns: (d)Topics covered – concept of corporate governance, need, scope, benefits,principles, advantages, disadvantages.Meaning of Corporate GovernanceCorporate governance is the system of rules, practices and processes by which afirm is directed and controlled. It involves balancing the interests of a company’smany stakeholders, management, customers, suppliers, financiers, government andcommunity. Since corporate governance also provides the framework for attaininga company’s objectives, it encompasses practically every sphere of managementfrom action plans and internal control to performance measurement and corporatedisclosure.According to Catherwood“Corporate governance means that company manages its business in manner that isaccountable and responsible to the shareholders. In a wider interpretation,corporate governance includes company’s accountability to shareholders and otherstakeholders such as employees, suppliers, customers and local community.”Need of Corporate Governancei.Widespread of Shareholders

ii.In today’s scenario there has been widespread of shareholders all over thenations and majority of shareholders are being unorganized and having anindifferent attitude towards corporate affairs also they remain confined onlyto the law and the Articles of Association therefore it requires a practicalimplementation through code of conduct of corporate governance.Changing Ownership StructureAt present the pattern of corporate ownership has been changed withinstitutional investors and mutual funds. These investors have become thegreatest challenge to corporate managements forcing the latter to abide bysome established code of corporate governance in order to build up its imagein society.iii.Corporate Scams or ScandalsCorporate scams or frauds in the recent years have shaken public confidencein corporate management. Therefore the need for corporate governance isthen imperative for reviving investors’ confidence in the corporate sectortowards the economic development in society.iv.Greater Expectations of society towards the Corporate SectorIn today’s scenario, the expectation of society towards corporate sector ishigher in terms of reasonable price, better quality, pollution control etc. Tomeet these social expectations there is a need for a code of corporategovernance.v.Hostile take-oversThere should be hostile take-over of the companies so that efficiency ofmanagement can be maintained. This factor points out the need of corporategovernance in the form of efficient code of conduct for the corporatemanagement.vi.Huge increase in top management compensationIn both developed and developing economies there has been a great increasein salary or compensation packages to the top level corporate executives andthere is no justification for high payment to the top management. And this

factor necessitates corporate governance to contain all the ill-practices of topmanagement of the company.vii.GlobalizationThe want and desire of more Indian companies to get listed on Internationalstock exchanges also focused on the need for corporate governance as theinternational market recognized only those companies which are wellmanaged according to standard code of corporate governance.Scope of Corporate Governancei.AccountabilityThe board of directors should be accountable to the owners of the companyi.e. shareholders. Corporate Governance is the interaction between variousparticipants in shaping corporation’s performance. The relationship betweenthe owners and the managers in an organization must be healthy and thereshould be no conflict between the two. The owners must see that individual’sactual performance is according to the standard performance and all thesedimension should not be overlooked.ii. Clarity in responsibilitiesCorporate Governance distinguishes between the owners and the managers. Themanagers are the deciding authority. Thus, the functions or tasks of owners andmanagers should be clearly defined rather harmonizing.iii. Quality and competence of DirectorsCorporate Governance deals with determining the ways to take effectivestrategic decisions. It gives ultimate responsibility to the Board of Directors.iv. TransparencyTransparency i.e. the right to information, time liners and integrity of theinformation produced. Corporate Governance ensures transparency whichbrings strong and balanced economic development. This also ensures that theinterest of all shareholders is safeguarded. It ensures that all the shareholdersfully exercise their rights and that the organization fully recognizes their rights.

v. Broad coverage or scopeCorporate Governance has a broad scope. It includes both social andinstitutional aspects. Corporate Governance encourages a trustworthy, moral aswell as ethical environment.vi. Adherence to the rulesSystems, practices and procedures by which the individual corporationregulates itself in order to remain competitive, sustainable, relevant andlegitimate for competitiveness and sustainability.Benefits of Corporate Governancei. Good corporate governance ensures corporate success and economic growth.ii. Strong corporate governance maintains investors’ confidence as a result ofwhich company can raise capital efficiently and effectively.iii. It lowers the capital cost.iv. There is a positive impact on the share price.v. It provides proper inducement to the owners as well as the managers to achieveobjectives that are in interests of the shareholders and the organization.vi. Good corporate governance also minimizes wastages, corruption, risks andmis-management.vii. It helps in brand formation and development.viii. It ensures organization to be managed in a manner that fits the best interests ofall.Principles of Corporate Governancei. TransparencyTransparency is something which brings openness and enables one tounderstand the truth easily. In the context of corporate governance it implies anaccurate, adequate and timely dis-closure of relevant information about theoperating system of the enterprise to the stakeholders.In fact transparency is the foundation of corporate governance which helpsto develop a high level of public confidence in the corporate sector. Forensuring transparency in corporate administration, a company should publish

relevant information about corporate affairs in leading newspaper e.g. onquarterly or half yearly or annual basis.ii. AccounatbilityAccountability is a liability to explain the results of one’s decision taken in theinterest of others. In the context of corporate governance, accountability impliesthe responsibility of the chairman, the Board of directors and the chiefexecutives for the use of company’s resources in the best interest of companyand its stakeholders.iii. IndependenceGood corporate governance requires independence on the part of the topmanagement of the corporation i.e. the Board of Directors must be strong, nonpartisan body so that it can take all corporate decisions based on businessprudence. Without the top management of the company being independent,good corporate governance is only a mere dream.Advantages of Corporate Governance1. & DevelopmentGoodwill & image creationMaintenance of investor confidenceIncrease value of sharesReduces the chances of mismanagementIncrease of productivityIncrease of market capitalization of the businessBenefits to all stakeholdersPayment of regular tax to the government.Disadvantages of Corporate Governance1. Separation of ownership & management2. Increase in administrative cost

NOTES:Name of the books for references:1. Entrepreneurship Development and Business Ethics by HimalayaPublications.2. Entrepreneurship Development and Business Ethics by OXFORD3. Entrepreneurship Development and Business Ethics by KalyaniPublication4. Entrepreneurship Development and Business Ethics by ABS Publications5. Entrepreneurship Development and Business Ethics by Tee DeePublications

a. Culture building b. Values c. Organizational socialization d. Attitudes Ans: (a) Que: 5 Types of corporate culture are _ a. Clan culture and Adhocracy culture b. Market culture and hierarchy culture c. Both (a) & (b) d. None of these Ans: (c) Que: 6 The practices of a