1. Learning Objectives To know what stakeholders are and their roles in the affairs of a corporation. To know the issues, problems, and possible remedies to corporate governance issues. To know the purposes of business ethics.

2. Stakeholders and Corporate Performance Stakeholder impact analysis The unique role of stockholders Profit, growth, and stakeholder claims

3. Agency Theory Principal-agent relationships The agency problem

4. Governance Mechanisms The board of directors Stock-based compensation Financial statements & auditors The takeover constraint Governance mechanisms inside a company

5. Ethics and Strategy Ethical issues in strategy Self-dealing Information manipulation Anticompetitive behavior Opportunistic exploitation Substandard working conditions Environmental problems Corruption The roots of unethical behavior

6. Ethics and Strategy (cont) Behaving Ethically Hiring and promotion Organizational culture and leadership Decision-making processes Ethics officers Strong corporate governance Codes of ethics Ethics officers