Reference no: EM132577637

Question 1. At its most recent meeting, the board of Nexican Services Ltd. decided that the company should implement a customer loyalty program to encourage new large accounts to switch over from Nexican's competitors. Which of the following statements about this decision is most accurate?

a) The board does not have the authority to make this decision.

b) The board has the authority to make this decision, but best practices support the decision being made by management.

c) The board would normally be expected to make this decision, but it would be acceptable for the board to delegate the decision to management.

d) The decision helps establish the primary mandate of the board; therefore it is strategically important.

Question 2. The Tait Foundation, a not-for-profit organization (NFPO), decided to implement several of the requirements of National Policy 58-201. Which of the following is the most likely rationale for this decision?

a) The foundation is a large NFPO and is required to comply with the national policy.

b) The board expects that the foundation will be required to comply with the national policy in the future.

c) The members of the communities the foundation serves are pressuring the board to adopt the national policy requirements.

d) The board believes that the costs to implement the requirements will be more than offset by increased performance and reduced risk.

Question 3. As a condition of lending, Artive Inc.'s major creditor, Big Bank, has appointed John Price as a member of Artive's board. Which of the following statements best reflects John's role? a) He has a duty to guard the interests of Big Bank, but his primary obligation is to the organization as a whole.

b) He has a duty to the organization as a whole, but his primary obligation is to guard the interests of Big Bank.

c) He is not able to serve on any of Artive's board committees.

d) He holds the role only as long as Artive is in debt to Big Bank

Question 4. Lackluster Inc. is a privately held corporation that has been in business for five years. The board has had rapid turnover of directors, although the core group of directors has served since the company's inception. The core directors know each other well, thus board procedures can be somewhat informal. The directors have very similar backgrounds and make decisions very efficiently, but the company is underperforming. From a board governance perspective, which of the following is most important for the board to focus on to help improve performance?

a) Independence policies

b) Director term limits

Board self-evaluation

d) Corporate code of conduct