CSEET · Economic and Business Environment · Elements of Corporate Governance
Aarav Textiles Ltd publishes timely and accurate information on its financial results, ownership and risks so that investors can assess it. Which principle of corporate governance is mainly being followed?
The principle being followed is transparency and disclosure. By publishing timely and accurate information on results, ownership and risks, the company lets shareholders and other stakeholders make informed decisions and hold management answerable. Limited liability and economies of scale are not governance principles.
- ATransparency and disclosureCorrect
- BLimited liability
- CSeparation of ownership from control
- DEconomies of scale
Explanation
Timely, accurate publication of financial, ownership and risk information is the core of transparency and disclosure. Separation of ownership and control describes the structure of a company, not the act of disclosing information. Limited liability concerns members' financial exposure.
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