Philippine Corporate Governance for Publicly Listed Companies

According to the principles, what should the company have to ensure integrity, transparency, and proper governance?

A strong and effective human resource system
A strong and effective internal control system (correct)
A strong and effective financial management system
A strong and effective marketing strategy

What is the measure of the Board's effectiveness according to Principle 6?

Through the company's financial performance
Through the CEO's approval
Through an assessment process (correct)
Through the shareholders' feedback

What is the relationship that the Board should endeavor to exercise on all corporate affairs?

A partial and discriminatory judgment
A biased and dependent judgment
A subjective and emotional judgment
An objective and independent judgment (correct)

What should the company establish according to Principle 8?

Corporate disclosure policies (A) Signup and view all the answers

What should the company respect according to Principle 14?

The rights of stakeholders established by law, by contractual relations and through voluntary commitments (C) Signup and view all the answers

What should stakeholders have the opportunity to obtain according to the principles?

Prompt effective redress for the violation of their rights (D) Signup and view all the answers

What is a major issue in the Philippines' natural resource governance?

Poor value realization and revenue management (D) Signup and view all the answers

What is the last step in the process of risk management?

Identification of ways to reduce those risks (C) Signup and view all the answers

What is a publicly listed company?

A corporation whose ownership is distributed amongst general public shareholders (B) Signup and view all the answers

What is risk avoidance in risk management?

Performing an activity that could carry risk (A) Signup and view all the answers

What is the primary responsibility of the board according to Principle 1?

To foster the long-term success of the corporation (C) Signup and view all the answers

What is a major challenge in conducting business in the Philippines, according to customs administration?

Irregular bribes and payments (D) Signup and view all the answers

What is the purpose of setting up board committees according to Principle 3?

To support the effective performance of the board's functions (D) Signup and view all the answers

What is the purpose of establishing standards for the selection of an external auditor according to Principle 9?

To strengthen the external auditor's independence and enhance audit quality (D) Signup and view all the answers

What is the first step in the process of risk management?

Establishing the context (A) Signup and view all the answers

What is the main reason for identifying potential risks?

To determine the expected likelihood and consequences (C) Signup and view all the answers

What type of issues should be disclosed according to Principle 10?

Material and reportable non-financial and sustainability issues (B) Signup and view all the answers

What is the purpose of maintaining a comprehensive communication channel according to Principle 11?

To facilitate informed decision-making by investors, stakeholders and other interested users (D) Signup and view all the answers

What is the primary focus of the distributive justice approach?

Preventing arbitrary treatment of people based on certain characteristics (D) Signup and view all the answers

Which of the following is a characteristic of corruption?

Abuse of entrusted power for private profit (A) Signup and view all the answers

What is a common issue in the public services land administration?

Corruption and arbitrariness in the application of the law (D) Signup and view all the answers

What is the primary concern of procedural justice?

Fair administration of rules and laws (D) Signup and view all the answers

What is a common issue in the judicial system?

The rich and powerful influencing proceedings (D) Signup and view all the answers

What is a common issue in the police force?

Engaging in corruption, extortion, and local rackets (D) Signup and view all the answers

What do Capital Adequacy Ratios measure?

The adequacy of a financial institution's capital relative to its risk exposure (C) Signup and view all the answers

What is the main difference between Business Risk and Financial Risk?

Business Risk is related to the firm's operations, while Financial Risk is related to the firm's financing (B) Signup and view all the answers

What is the purpose of using derivatives, such as options and futures, in a firm's operations?

To increase the return to the common shareholders (B) Signup and view all the answers

What is the relationship between Operating Leverage and Business Risk?

Operating Leverage increases Business Risk (D) Signup and view all the answers

What is the Coefficient of Variation used to measure?

The risk of an investment relative to its expected return (A) Signup and view all the answers

What is the main difference between Operating Leverage and Financial Leverage?

Operating Leverage is related to the firm's operations, while Financial Leverage is related to the firm's financing (B) Signup and view all the answers