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1.
How much money the company pays its CEO and top management is _______.
An important sign of how the company has set up its incentive system. The compensation of top corporate officers is a touchy subject, mostly because a lot of corporate officers are paid a great deal of money. We dont have any hard and fast rules for determining how much is "too much," but at the extremes, executive pay can eat up a significant chunk of corporate profits, which eats directly into shareholder returns.
2.
You can get information on the backgrounds and qualifications of the managers of companies you are interested in from the Securities and Exchange Commission.
True. Companies include information on their managers in their shareholder statements, which are filed with the SEC.
3.
A stock analyst might interview a companys customers to get a sense of whether the company would be a good investment.
True. An analyst might interview customers, typically larger institutional ones.
4.
Another term for fiduciary responsibility, according to Philip Fisher, is trusteeship.
True. Fisher described the qualities he looks for in managers as trusteeship.
5.
A companys board of directors represents its management.
False. The board represents the shareholders and their interests.
