Corporate Governance Failures at Fannie Mae and Freddy Mac Included

question 85

Multiple Choice

Corporate governance failures at Fannie Mae and Freddy Mac included all of the following EXCEPT

• A) a lack of understanding regarding the risks of subprime loan strategies.
• B) a strong independent board of directors that was responsible for making independent judgments about the validity and wisdom of management's proposed strategic actions.
• C) inadequate monitoring of the CEO and other senior executives.
• D) fraudulent executive compensation systems.
• E) ineffective oversight of the accounting principles employed to accurately determine earnings.

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Definitions:

Need For Control

The desire or requirement to influence or dictate the behavior of others or the outcome of events.

Contingency Theory

A leadership theory that suggests the effectiveness of a leader is contingent upon how their leadership style matches the situation.

Leadership Ability

The capacity to guide, influence, or direct the behavior or opinions of others in a desired direction.

Situational Factors

External factors or circumstances that can affect an individual's behavior or the outcome of a decision or action in a specific context.