The threat of corporate takeover has little impact on how responsibly a corporate board and management manage a firm.

Question

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The threat of corporate takeover can have a significant impact on how responsibly a corporate board and management manage a firm. When a company is vulnerable to a takeover, the board and management may be more likely to prioritize short-term gains, cut costs, and take other actions to boost the company's stock price in order to deter potential acquirers. This can lead to a neglect of long-term sustainability, ethical considerations, and stakeholder interests. Additionally, the prospect of a takeover can create pressure on the board and management to take steps to improve the company's financial performance, which may involve taking greater risks or engaging in more aggressive business practices.

The Threat of Corporate Takeover Has Little Impact on How