The management of Smith and T Co$.$ controls $58\%$ of the company$$s stock. The firm did not meet any of its quarterly sales projections for the last year. Some of the firm$$s institutional investors are worried that the firm$$s poor performance is partly because management has not been focused on maximizing shareholder wealth. Which of the following measures would the institutional investors most likely want to see implemented?

They would like to see that the company has an interlocking board of directors with one of the company$$s strategic partners.

They would like to see the size of the board of directors increased, because larger boards usually implement a higher degree of corporate governance.

They would like to see that the majority of the company$$s board of directors is composed of true outsiders.

It is reasonable to assume that a firm$$s management is going to be ultimately motivated to act in their own best interest. It can be a serious problem for shareholders if management$$s self$-$interests do not align with shareholders$$ self$-$interests. Select the statement that best describes the board of directors$$ actions in the following scenario:

Tolbotics Inc.$$s board of directors has decided to buy back $200,000$ shares of the company$$s stock on the open market. The board believes that this stock repurchase will increase the firm$$s earnings per share.

The board$$s decision will give management the incentive to make decisions that are not in the shareholders$$ best interest.

The board$$s decision will help align management$$s interests with the shareholders$$ interests.

A stock repurchase will not have an effect on the relationship between managers and shareholders.