Question 3: Corporate governance (18 marks) (a) Research has shown that investors generally look favourably upon companies that add outside directors to the board. Rosenstein and Wyatt (1990) found that adding an indepeadent director to the board leads to a significant increase in share price around the announcemeat date. 1. Why do you think this would be so? 2. What are the advantages of having independent directors on the board? Answer space for question 3 part A - expand the table as necessary to contain your answer (b) Explain the relationship betareea ethics and corporate govemance. Just because you have good corporate governazce, does it mean that you will also have good ethics? Whyiwhy not? Answer space for question 3 part B - expand the table as necessary to contain your answer Question 3: Corporate governance (18 marks) (a) Research has shown that investors generally look favourably upon companies that add outside directors to the board. Rosenstein and Wyatt (1990) found that adding an indepeadent director to the board leads to a significant increase in share price around the announcemeat date. 1. Why do you think this would be so? 2. What are the advantages of having independent directors on the board? Answer space for question 3 part A - expand the table as necessary to contain your answer (b) Explain the relationship betareea ethics and corporate govemance. Just because you have good corporate governazce, does it mean that you will also have good ethics? Whyiwhy not? Answer space for question 3 part B - expand the table as necessary to contain your