Business Law with UCC Applications,13e Corporate Governance Chapter 27 McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.

27-2 Learning Objectives 1.Explain the central dilemma of corporate governance. 2.Describe the functions of directors, officers, and shareholders. 3.List the five theories of corporate governance. 4.Describe cumulative voting and proxy solicitation. 5.Explain shareholder proposals.

27-3 Learning Objectives (cont.) 6.Distinguish between voting trusts and pooling agreements. 7.Contrast shareholder direct suits with shareholder derivative suits. 8.Contrast the business judgment rule with the fairness rule. 9.List the rights that belong to shareholders. 10.Explain the management of a limited liability company.

27-4 Corporate Governance Management of the Corporation –Directors of the Corporation –Officers of the Corporation –Shareholders of the Corporation

27-5 Corporate Governance Directors of the Corporation –Qualifications of Directors –Time Commitment of Directors –Meetings of Directors

27-6 Corporate Governance Issues in Corporate Governance –The Corporate Balancing Act Revisited –Theories of Corporate Governance –Shareholder Voting Control –Shareholder Lawsuits

27-7 Corporate Governance Theories of Corporate Governance –Special Interest Group Control –Governmental Control –Independent Director Control –Managerial Control –Shareholder Democracy

27-8 Corporate Governance Shareholder Voting Control –Cumulative Voting –Proxy Voting –Shareholder Proposals –Voting Trusts –Pooling Agreements –Shareholder Nominations –Unanimous Voting Restrictions –Combinations

27-9 Corporate Governance Shareholder Lawsuits –Direct Suits –Derivative Suits

27-10 Corporate Governance Governance Responsibilities –The Business Judgment Rule –The Fairness Rule –The Actual Authority Rule

27-11 Corporate Governance The Fairness Rule –The Insider Trading Rule –The Corporate Opportunity Doctrine

27-12 Corporate Governance The Actual Authority Rule –Efforts to Limit Liability –Efforts to Increase Responsibility

27-13 Corporate Governance Shareholder Rights –Right to Examine Corporate Records –Right to Share in Dividends –Right to Transfer Shares of Stock –Preemptive Rights

27-14 Corporate Governance Governance of a Limited Liability Company –Member-Managed LLCs –Manager-Managed LLCs –Fiduciary Duties