Folder:
115 CFA
File:
115.050.01.08 Corporate Finance - Reading 31 - 8. Analyst Considerations in Corporate Governance and Stakeholder Management

8. Analyst Considerations in Corporate Governance and Stakeholder Management

i. describe factors relevant to the analysis of corporate governance and stakeholder management;

From an analysts perspective, why is Economic Ownership and Voting Control important?
What is the company's ownership and voting structure among shareholders? Why do some shareholders own a small portion of a company's stock but get most of the voting power? Does the practice really insulate managers from Wall Street's short-term mindset? Dual-class structures create an inferior class of shareholders, and may allow management to make bad decisions with few consequences.

From an analysts perspective, why is Board of Directors Representation important?
Analysts should assess whether the experience and skill sets of board members match the needs of the company.


Source:
  • CFA