Question

which is not a governance mechanism? group of answer choices sarbannes-oxley (2003) act barring auditing companies from doing certain types of non-audit work. major investor buying 5% of the company. chairman of the board setting ceo pay. chief financial officer firing an accounting manager.

Answer 1

The choice that is not a governance mechanism is the 'Chief Financial Officer firing an accounting manager.' Corporate governance primarily involves the board of directors, auditing firms, and outside investors.

Step-by-step explanation:

Among the provided options, the one that is not a governance mechanism is a Chief Financial Officer (CFO) firing an accounting manager. Corporate governance mechanisms include the board of directors providing oversight for top executives, auditing firms reviewing financial records for accuracy, and the influence of outside investors, especially those with significant shareholdings.

The Sarbanes-Oxley Act of 2002 is a prime example of legislative efforts to strengthen corporate governance after notable accounting scandals, by barring auditing companies from doing certain types of non-audit work to prevent conflicts of interest and enhance the reliability of financial reporting.