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Which of the following actions seeks to avoid exploitation of minority shareholders?
Correct Answer: B
Minority shareholder rights are often at risk in companies where majority shareholders exert excessive control. Why B (Granting pre-emption rights) is correct: Pre-emption rights give existing shareholders the first right to purchase new shares before they are offered to others, preventing dilution. This protects minority shareholders from being unfairly disadvantaged when companies issue new equity. Why not A or C? A (Dual-class shares) concentrates voting power in a select group, often harming minority shareholders. C (General mandate resolutions) allow boards to issue shares without shareholder approval, potentially disadvantaging minority investors. References: OECD Principles of Corporate Governance (2023) World Bank Report on Minority Shareholder Protections (2022)