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A trust in Pune running a school has trustees who never publish accounts, do not consult parents, and appoint relatives to paid posts. A donor questions the trust's standing as a well-governed social entity. Which gap in social governance is most directly shown by these facts?

The facts show a lack of transparency, stakeholder engagement and ethical, conflict-free management. Social governance expects public-purpose entities such as trusts to disclose accounts, consult those they serve and avoid favouring relatives. Dividends or listing are not relevant to a charitable school trust.

  1. AAbsence of transparency, stakeholder engagement and fair conduct in managing a public-purpose entityCorrect
  2. BFailure to declare a dividend to beneficiaries
  3. CLack of a registered office in a metropolitan city
  4. DFailure to list its units on a stock exchange

Explanation

Social governance expects entities with public purposes to be transparent, consult stakeholders and avoid conflicts of interest. Non-disclosure of accounts, ignoring parents and nepotism breach these expectations. Dividends and listing are irrelevant to a charitable trust.

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