Question

In: Finance

In much of Asia and Latin America, companies that are parts of family groups comprise a...

In much of Asia and Latin America, companies that are parts of family groups comprise a large percentage of publicly traded companies. From a corporate governance standpoint, which of the following would concern you the most at these companies?

  • A. They will make decisions that are in the best interests of the family group, rather than in the best interests of the company
  • B. They will pay out too much in dividends.
  • C. They will make decisions that are in the best interests of the company, rather than in the best interests of the family group.
  • D. They will be too aggressive, in seeking out growth and investments.
  • E. They will not borrow enough money to fund operations.

Solutions

Expert Solution

Family owned publicly traded companies tend to make decisions that are in best interest of family wealth maximisation rather than for the company , so Option A.


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