ACCA Strategic Business Leader (SBL) Practice Exam

The concept of board structures is essential in understanding corporate governance, as it heavily influences how an organization operates and makes decisions. The two types of board structures commonly recognized are unity and two-tier systems.

In a unity board structure, there is a single board of directors that encompasses both the executive and non-executive members. This unified approach allows for streamlined decision-making and a cohesive strategy, where management and oversight exist within the same group. This type of structure is prevalent in many Anglo-American companies.

On the other hand, the two-tier board system is characterized by having separate boards for management and supervision. This approach, often found in countries like Germany, features a management board that handles daily operations and a supervisory board that oversees and provides checks and balances on the management. The separation aims to enhance governance by reducing conflicts of interest and increasing accountability.

Recognizing these two structures is significant as they reflect different corporate governance philosophies and can lead to varying implications for accountability, transparency, and efficiency within organizations. The other options do not accurately identify recognized board structures within the context of corporate governance and therefore do not apply to this question.