Regarding the separation of corporate ownership and management, which of the following is a true statement?
A) The corporate officers elect the board of directors.
B) The corporation runs better with day-to-day input from stockholders.
C) Stockholders are required to manage the business.
D) Stockholders own the business, but a board of directors appoints corporate officers to manage the business.

Question

Quizplus · Accepted Answer

Corporate ownership and management are usually separated in corporations. Stockholders own the business but they do not manage it directly. Instead, a board of directors appoints corporate officers to manage the business on their behalf. Corporate officers may include the CEO, CFO, COO, etc. The board of directors is usually elected by the stockholders. Option B is incorrect because day-to-day input from stockholders is not practical or efficient, and may lead to micromanagement. Option C is incorrect because stockholders are not required to manage the business - it is not their role.

Regarding the Separation of Corporate Ownership and Management, Which of the Following