The Governance Mechanism Most Closely Connected with Deterring Unethical Behaviors

question 54

Multiple Choice

The governance mechanism most closely connected with deterring unethical behaviors by holding top management accountable for the corporate culture is

• A)ownership concentration.
• B)the market for corporate control.
• C)executive compensation systems.
• D)the board of directors.

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Definitions:

Self-Serving Bias

Self-serving bias is the tendency to attribute positive events to one's own character but attribute negative events to external factors, affecting judgment and decision-making.

Planning Fallacy

The optimistic cognitive bias that leads individuals or teams to underestimate the time, costs, and risks of future actions, while overestimating the benefits.

Overconfidence Effect

A cognitive bias where people overestimate their own abilities, knowledge, or predictions.

Behavioral Economics

A branch of economics concerned with understanding how the economic behaviors of individuals and institutions are impacted by factors like psychology, cognition, emotions, culture, and society.