Final answer:
The correct option is A). Internal preparation for executive transition is a collaborative effort between the board and the CEO to ensure smooth leadership change and continued operations in shareholders' interests.
Step-by-step explanation:
Internal preparation for executive transition is the shared responsibility of the board and the CEO (Chief Executive Officer). When preparing for a leadership change, the board of directors works in tandem with the current CEO to manage the transition process, which often includes identifying and grooming potential successors. The board ensures the company's governance aligns with the interests of shareholders, while the CEO assists in choosing board candidates and preparing the administrative aspects of the transition. This collaboration aims to facilitate a smooth change in leadership, ensuring that the firm continues to operate effectively in the interests of its true owners—the shareholders.