The threat of hostile takeovers is a factor in encouraging a firm to implement good governance practices.

Question

Quizplus · Accepted Answer

The threat of hostile takeovers can make a company vulnerable to being acquired by another company against its will. To prevent this, a company may implement good governance practices such as having a strong board of directors, transparency in financial reporting, and accountability to shareholders. These practices can make the company more attractive to investors and reduce the risk of being taken over.

The Threat of Hostile Takeovers Is a Factor in Encouraging