Asked by Tyler Slaven on May 28, 2024
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The board of directors has the power to act on behalf of the shareholders to hire and fire the operating management of the firm. In a legal sense, the directors are "principals" and the shareholders are "agents".
Board Of Directors
The Board of Directors is a group of elected individuals tasked with overseeing the major decisions and policies of a company.
Shareholders
Individuals or entities that own shares in a corporation, giving them ownership stakes and typically the right to vote on corporate matters.
Principals
Principals typically refer to the main parties involved in a transaction or operation, such as the owners or chief stakeholders of a company.
- Recognize the importance of shareholder and stakeholder roles in corporate governance and the ethical considerations in financial management.
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Learning Objectives
- Recognize the importance of shareholder and stakeholder roles in corporate governance and the ethical considerations in financial management.
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