Answer true or false to each of the following statements. In each case fully explain the reasoning behind your answer. One mark will be allocated for the correct answer with the remaining four marks allocated to your explanation.
(i) Having CEO-chair duality (the Chief Executive Officer is also the chairman of the board of directors) enhances a company’s corporate governance.
(5 marks)
(ii) Cumulative Voting protects minority shareholders against exploitation by dominant shareholders.
(5 marks)
(iii) Cross-directorships reduce the independence of the board.
(5 marks)
(iv) The asset use problem that can emerge from the separation of ownership from control is solely concerned with the consumption of perks by management.
