ECOS3003 Lecture Notes - Lecture 12: Decision Management, Chief Operating Officer, Financial Statement
30 Jul 2018
School
Department
Course
Professor
Document Summary
Can enter into contracts and participate in law suits: have the legal standing of an individual (distinct from its shareholders), have rights to issue stock. Laws require board of directors to have primary decision control rights for the firm. Shareholders have limited liability (only their initial capital contribution subject to risk they are not legally responsible for the debts of the company). Institutional stock ownership increased: widely held (no one owner controls more than 10% of shares). Corporate governance: the organizational architecture at the top of a corporation. Top-level architecture: organizational architecture of typical corporation does not give absolute authority to professional managers, decision rights divided among shareholders, the board of directors, top management, external monitors. Similar principle as separating decision management and decision control. Shareholders have limited powers to participate in the management of the company. Right to vote in the election of directors. Ight to (cid:448)ote to ratif(cid:455) the i(cid:374)depe(cid:374)de(cid:374)t auditors a(cid:374)d o(cid:374) (cid:858)fu(cid:374)da(cid:373)e(cid:374)tal(cid:859) issues.
