Chapter 43 provides knowledge of management of corporations. After reading the material in this chapter, you should be able to: Recognize limits on the objectives and powers of corporations, describe the roles of the board of directors and various committees, discuss recent developments in corporate governance, adapt corporate governance rules to the close corporation. | Corporations History & Nature of Corporations Organizational and Financial Structure of Corporations Management of Corporations 10 McGraw-Hill/Irwin Business Law, 13/e © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Corporations Shareholders’ Rights & Liabilities Securities Regulation Legal & Professional Responsibilities of Auditors, Consultants, and Securities Professionals 10 McGraw-Hill/Irwin Business Law, 13/e © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Management of Corporations P A E T R H C 43 “Managers should work for their people and not the reverse.” Kenneth Blanchard, Leadership and The One Minute Manager (2000) Learning Objectives Corporate objectives Corporate powers The Board of Directors Officers of the corporation Directors’ and officers’ duties to the corporation Corporate and management liability 43 - Shareholders own the corporation, but elect a board of directors to manage the firm For board to act, a quorum must be present and each | Corporations History & Nature of Corporations Organizational and Financial Structure of Corporations Management of Corporations 10 McGraw-Hill/Irwin Business Law, 13/e © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Corporations Shareholders’ Rights & Liabilities Securities Regulation Legal & Professional Responsibilities of Auditors, Consultants, and Securities Professionals 10 McGraw-Hill/Irwin Business Law, 13/e © 2007 The McGraw-Hill Companies, Inc. All rights reserved. Management of Corporations P A E T R H C 43 “Managers should work for their people and not the reverse.” Kenneth Blanchard, Leadership and The One Minute Manager (2000) Learning Objectives Corporate objectives Corporate powers The Board of Directors Officers of the corporation Directors’ and officers’ duties to the corporation Corporate and management liability 43 - Shareholders own the corporation, but elect a board of directors to manage the firm For board to act, a quorum must be present and each director has one vote Board committees: executive, nominating, compensation, shareholder litigation Audit committee required by Sarbanes-Oxley Act Directors are elected by shareholders at the annual shareholder meeting Board of Directors 43 - WARNING: This is a long and detailed chapter! Some corporate actions (., dissolution) require shareholder approval: Amending articles of incorporation, mergers, and dissolution The traditional objective of the corporation has been to enhance corporate profits and shareholder gain However, corporations may take socially responsible actions to enhance long-term profits or corporate goodwill Corporate constituency statutes support these actions The board of directors supervises the actions of its committees, the chairman, and officers to ensure the board’s policies are being carried out and the corporation is managed wisely The most common board committee, the executive committee, has authority to act for the board on most matters when the .
