The Board of Directors of Acme Brands Is Discussing the Design

The board of directors of Acme Brands is discussing the design of a very generous stock option plan for its top executives. During the debate, one of the directors raises the point that CalPERS owns a significant portion of Acme Brand stock. Which of the following statements is likely to be TRUE?

A) This will have no effect on the stock option plan design discussion, because CalPERS' main concern is stock dividends.
B) CalPERS' interest in Acme Brands will cause the directors to reduce the size of the stock option plan from what it would otherwise have been.
C) CalPERS supports generous stock option plans for executives because it motivates underperforming executives.
D) For legal reasons, the board cannot consider the interests of CalPERS over the interests of its top executives.