The Board of Directors Has the Power to Act on Behalf

question 148

True/False

The board of directors has the power to act on behalf of the shareholders to hire and fire the operating management of the firm. In a legal sense, the directors are "principals" and the shareholders are "agents".

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Definitions:

Role Demands

The expectations and responsibilities placed on an individual in a particular role within an organization or society.

Expectations

Assumptions or beliefs about what will happen in the future or how someone should behave.

Anticipatory Socialization

The process through which individuals learn and adopt the values, behaviors, and norms of a group or organization they aspire to join.

Congruence

The degree to which elements are in agreement or harmony with each other, often used to describe the alignment between personal values and organizational objectives.