Mastering Corporate Governance
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Questions and Answers

What is dispersed ownership and how does it affect corporate governance?

Dispersed ownership refers to a structure in which no individual or group has significant control or voting power in a company. This can impact corporate governance as it may lead to a lack of incentive for profit maximization.

What is ownership transparency and why is it important?

Ownership transparency refers to revealing the ultimate owners, controllers, and beneficiaries of a company or trust fund. It is important because it helps identify the individuals or entities behind a company, preventing criminal activities and corruption.

How can beneficial owners be masked in corporate structures?

Beneficial owners can be masked through complex structures such as anonymous shell companies, trusts, foundations, bearer shares, or chains of third parties who act on their behalf.

Why do criminal organizations and corrupt individuals take advantage of opaque corporate structures?

<p>Criminal organizations and corrupt individuals exploit opaque corporate structures because they provide a way to hide the true ownership and control of assets, enabling illicit activities and money laundering.</p> Signup and view all the answers

What does ownership transparency entail for companies?

<p>Ownership transparency for companies involves publishing structures and disclosing beneficial ownership information in open data formats.</p> Signup and view all the answers

Elements of Corporate Governance Dispersed ______- structure in US means that there is no individual or group with either the voting power or the incentive to exercise control and enforce profit maximization', by Leech and Leahy (1991).

<p>ownership</p> Signup and view all the answers

The fraction of shares of one shareholder is below 5% of the shares in the whole company. Transparent ______- Ownership transparency reveals who ultimately owns, controls or benefits from a company or trust fund and the income it generates.

<p>Ownership</p> Signup and view all the answers

This person is sometimes described as the ______ owner”.

<p>beneficial</p> Signup and view all the answers

Beneficial owners can be masked through complex structures including layers of anonymous shell companies, trusts, foundations, bearer shares, or chains of third parties, who act on their behalf. Criminal organizations and people engaging in corruption have consistently taken advantage of opaque corporate ______.

<p>structures</p> Signup and view all the answers

For companies, ownership transparency means publishing structures and beneficial ownership disclosures in ______ data.

<p>open</p> Signup and view all the answers

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