Explain how external auditing helps ensure good corporate leadership
Corporate leadership is simply the processes and policies via which a firm manages its traditions, finances and institutions. Corporate leadership is important as it enhances workplace honesty and impartiality in firms and organizations. It achieves this via thorough output monitoring and enforcement of accountability in all sectors. One of the most important specialists which strengthen the resolve of corporate leaders in following good governance habits is an external auditor.
An external auditor's main function is to ensure the firm's shareholders do not suffer any unnecessary losses. As an external auditor has no affiliation with the company, this objective is easily met. Determining the health of a firm's finances and the accuracy of previous financial statements are also functions of an external auditor. An audit gives the shareholders rest of mind over the firm's true condition and sometimes, they ask…… [Read More]
eliability & Validity
The key will be to find reliability and validity. eliability, of course, is the concept that if someone else does the same exact research in the same exact way, the research conclusions drawn will be close to if not entirely identical. Validity is similar in that the conclusions met have to be directly applied and ascertained based on the data that actually exists and not based on the exclusion of viable but clearly contradictory data and/or coming to conclusions that the data clearly does not support. For example, a study that makes a conclusion based on sheer numbers, rather than proportions and percentages of the relevant groups, is almost certainly flawed even if the conclusions drawn are certainly correct as that would be a clear validity problem. A reliability problem would be a study done in much the same nature but perhaps has different sources but comes…… [Read More]
Corporate Governance of Commonwealth Bank:
Australia's Commonwealth bank is a multinational bank with operations across the United States, United Kingdom, Asia, Fiji, and New Zealand. The bank provides various financial services including superannuation, broking services, investment, retail, business and institutional banking, and insurance. The financial institution is currently regarded as the country's second largest organization listed on the Australian Securities Exchange. Together with National Australia Bank, ANZ, and Westpac, Commonwealth bank is among the biggest four banks in Australia. The bank's strategic and business goals that form its aspirations are rooted on four major aspects i.e. customers, people, shareholders, and the community. For its customers, the company seeks to provide service experience that they value and recommend. On the other hand, Commonwealth bank seeks to offer safe, challenging, fair, and rewarding tasks to all it employees and people. In addition to being an active participant that contributes to a stable…… [Read More]
Two different, yet related corporate governance definitions have been presented in this paper (Mallin, 2006: 3). Sometimes they cause confusions and controversy and ultimately affect the implementation of tightening of governance (Windsor, 2009).
The 1992 Cadbury eport, which presented the major proposals for tightening governance, described governance as the system through which firms are managed, regulated and supervised (Cadbury, 1992: 15). The fundamental agency idea emphasizes that corporate governance has to deal with those ways in which corporate financial suppliers guarantee themselves of attainment of a positive return on investment (Shleifer and Vishny, 1997: 737). Corporate Governance can be described more generally (Weil and Manges, 2002: 1). The OECD principles, which were revised in 2004 explain the governance as a set of stakeholder job relationships along with the structure for defining, achieving, and monitoring corporate goals as well as performance (Mallin, 2006: 3).
The mixture of these two…… [Read More]
Corporate Governance: A review of Literature
What is Corporate Governance?
Principles of Corporate Governance
Theoretical foundations of corporate governance
Corporate Governance: The changing trends
Recent developments on regulatory front and research
Corporate Governance: Relationship with market indicators
Venture Capital Model: Impact on Corporate Governance
Appendix I- Examples of Corporate Governing bodies
This paper is a review of pertinent literature on corporate governance. Corporate governance addresses the control issues created due to the separation of ownership and management of a corporation.It is generally considered as the means by which shareholders control the board of directors.Corporate governance maintains relationships between board of director, stakeholders and shareholders. Every relationship has high significance and multi-faceted aspects. OECD considers corporate governance as a framework dealing with the problems resulting from the separation of ownership and control of a corporation. Precisely stating, Du Plessis, et al. (2010) defines…… [Read More]
Corporate Governance in Harris Scarfe:
Harris Scarfe Department Stores is a company that was founded in 1849 in Adelaide, South Australia and housed various major South Australian department stores. The history of the organization is traced to a period when the founding partners John C. Lanyon and George Peter Harris arrived in this region to institute an ironmongery and hardware business. In the initial years, the company carried out its business activities i.e. retailing business in its premises in Adelaide. However, the firm also manufactured several leather products such as luggage and saddlery. In the early 2000s, Harris Scarfe was among some of the companies that collapsed and shocked the Australian society. The collapse was attributed to corporate scandals and accounting irregularities that made the company to be on the brink of facing administration.
Collapse of Harris Scarfe:
In 2001, the suppliers and customers of the company as well as…… [Read More]
Identify the corporate governance problems leading up to the corporate scandals of the early 21st century. Which of these problems might McBride fall prey to if Hugh does not accept your proposed solution?
Corporate governance has provided its fair share of publicity over the past decade. Most of which was a result of foul practices on the part of management, while some was due to a genuine interest in investor well being. Many issues of corporate governance have led to many of the scandals that have been publicized in recent years. Below is list of many of these practices and how they subsequently affect business on a global scale. This list is by no means exhaustive but I do believe it provides significant information as to why some of the scandals of recent years have occurred.
Management as owners vs. Management as representatives- This statement may seem one…… [Read More]
Corporate Governance Sustainability
During the last several years, the issue of corporate governance has been increasingly brought to the forefront. This is because the financial crisis exposed the weaknesses of the current system by: failing to protect the interests of stakeholders. In response to these challenges, various reports have been reexamined. One of the most notable is the King eport of 2002. It identified several different criteria that can be used to prevent excessive risk taking. To fully understand how these ideas can be implemented in a corporate environment requires examining the recommendations provided with an actual firm (i.e. Galaxo Smith Kline PLC). Once this takes place, is when the positive and negative elements of these practices will be obvious.
The King eport of 2002
The King eport found that one of the most effective strategies for improving governance is to embrace practices that are reducing risk. The best way…… [Read More]
Governance and Ethics
Corporate Governance & Ethics
Dr. Doight is the highly respected executive at Universal Human Care Hospital. He and Universal both stand to lose a great deal if it leaks out that patients have been dying due to lack of internal controls and simple negligence. Not only have patients been dying, but it has been going on for at least two years and while Dr. Doight has been fully aware that problems exist. The implications are far-reaching and substantial.
A corporate stakeholder is anyone who can affect, or is affected by, the performance and health of a business (Fiedler & Kirchgeorg, 2007). There is a litany of internal and external stakeholders that stand to be impacted greatly depending on how this negligence matter turns out. One group of stakeholders is the employee base at the hospital. While some of them are actively contributing to the problem at…… [Read More]
Since United States and Australia are countries which are already considered to be globally competitive that has attained its almost perfect status in the world market, developing countries are basically taking into account every step that they make for which they might soon adapt to attain the same position in the global context. Therefore, studying both countries' corporate governance is necessary in order for other developing countries to learn from their experiences.
Similarities and Differences of U.S. And Australia's Corporate Governance and Responsibility
Global trends in the corporate governance made the countries more or less similar when it comes to their responsibilities concerning the issue. Not only in the implementations did these countries have become similar, but even with the different issues involving controversies and failures connected to corporate governance as well.
These failures have further stimulated the debate about corporate governance, leading to regulatory action and other…… [Read More]
How Nigerians Can Influence the Change We Desire
There is a general belief that poor corporate governance has been the vulnerable point of numerous companies in both developing and developed countries. This is especially the case with Nigeria, where in spite of being vastly blessed with resources such as oil and a huge labor force, continued to be adversely impacted by corruption. Good governance is a significant step in facilitating market confidence and boosting stable, long-standing global investment flows into the nation. Bearing in mind the business companies are progressively more significant drivers of creating wealth and development, not just in the local economy but also internationally, it is key for Nigerian companies to function within the benchmarks that keep them concentrated on their objectives and make them culpable to stakeholders for the actions and decisions they make.
Definition of Corporate Governance and its Role
The significant necessity for…… [Read More]
Governance Codes: Germany, Denmark, France and Italy
Although all four nations are members of the European Union and share notable similarities in their capitalist economic structures, Germany, Denmark, France and Italy also have historically exhibited some distinct differences in their corporate governance. For example, much like in the United States, in Germany and Italy the CEO and Chairman of the Board of directors is often the same figure, to ensure coherency of policies; in Denmark and France, these are usually fulfilled by different functionaries to ensure greater independent oversight and presumably more ethical independence of the board when advancing the interests of shareholders (Vintila & Raluca, 2015). German firms also have historically had a two-tier corporate board governing them, versus France and Italy, where corporations have a choice of one or two-tier levels of corporate governance (“Comparative Corporate Governance,” n.d.). But according to Baker (2006), although there has been considerable…… [Read More]
1. What is an agency relationship? When you first begin operations, assuming you are the only employee and only your money is invested in the business, would any agency conflicts exist? Explain your answer.
Agency relationship is delineated as the relationship between the principal and agent. It is an association within the business that provides the principal with legal authority to an agent in order to act on behalf of the principal when transacting with a third party. Agency conflicts would not exist. More often than not agency conflicts emanated when an owner of the firm possesses less than 100 percent of the common stock of the firm. In this case, taking into consideration that there is solely one employee and the complete investment belongs to you, then ownership is 100 percent.
2. If you expanded and hired additional people to help you, might that give rise to agency problems?…… [Read More]
Glen and Singh (2004) are strongly critical of the Greenspan-Summers-IMF thesis, which posited that microeconomic behaviours of economic agents in Asian societies were responsible for the Asian crisis. One of the fundamental challenges in evaluating their critique becomes apparent quickly – the original source material is strangely absent. The references in Glen & Singh are not of a consistent thesis at all, but a series of statements made by Greenspan and Summers, for which it is difficult to track down the original source material. This matters because in order to evaluate Glen and Singh's critique, I need to know if they strongmanned that thesis, or strawmanned it. Instead I am left with Glen and Singh's interpretation of that that "thesis" is, which is not a good starting point for proper evaluation of their critique.
Glen and Singh paraphrased this thesis as asserting "that although certain macroeconomic disequilibria may have provided…… [Read More]
It should not be treated as a separate exercise undertaken to meet regulatory requirements." (ICA, 29) Here is expressed a philosophical impetus that drives the focus of this research, that such compliance which will generally concern matters such as corporate accounting, the practice of internal oversight and the practice of financial transaction must be considered inextricable from other aspects of practical, procedural and legal operation in terms of its relevance and necessity.
The practice of corporate governance may perhaps best be understand from the perspective that deregulation has largely defined the processes and direction of the global economy across the two decades following the Cold ar and its inevitable opening of economic channels. This is because in practice, corporate governance is a concept which has suffered much neglect. To the point, the statistics availed by organizations such as the orld Bank and the International Monetary Fund illustrate that…… [Read More]
As some queries about corporate governance were there ever since 1932 - the period of erle and Means, the expression of the concept of Corporate Governance was not found in English vocabulary until 25 years ago. However, in the previous two decades, matters relating to corporate governance have gained importance in academic literature as well as in public policy deliberations. Corporate governance came to be acknowledged as being synonymous with takeovers, financial restructuring, and activities of institutional investor's during this part of the era. Corporate Governance is now at a turning point. Several budding and up-coming economies that are on the path of development have identified by now that excellent corporate governance is vital for sustainable economic development. Furthermore, a lot are on the lookout for a novel or appropriate standard for making it relevant for their particular internal situation. (erle and Means, 1932)
The last ten years…… [Read More]
Additionally, it has been observed that whenever companies implement strategies of CS, they do this not out of individual choice and desire, but as a result of imposed legislations. "All of these decisions are made under the mandatory legal rules embodied in employment and labor law, workplace safety law, environmental law, consumer protection law, and pension law. Such rules, because they often apply to all businesses, are not susceptible to easy evasion through choice of form. As a result, those charged with governing a corporation find their decision tree considerably trimmed and their discretion decidedly diminished by mandatory legal rules enacted in the name of protecting stakeholders" (Winkler, 2005). In other words, the modern day evolutions of corporate social responsibility "caution against a rush to declare the ultimate triumph of shareholder primacy" (Winkler, 2005).
As a direct result of this changing legislation, more companies have commenced corporate social responsibility programs.…… [Read More]
In these cases, others working in those fields are the only ones who have the ability to conduct quality check to verify instances of possible fraud. Qualified doctors can analyze the work of other doctors to attest their medical malpractice. An honest lawyer who deals with related issues can understand how a fellow lawyer could have used deceitful methods to cheat a client off his money. Proficient lecturers can set good examples for students to bring out the incompetency of others. In the managerial level, well qualified professionals are the only ones who are smart enough to figure out the plots hatched by higher executives in order to use the shareholder money for personal needs. Scams in the political sector can only be challenged by opposing political parties or powerful entities like the court. The media is highly potent in this regard as they present malpractices in front…… [Read More]
There have been controversies on the subject of the governance and accountability of big corporations, but it is only recently that these issues have gained prominence. The compensation for the top management is one of the major issues of corporate governance today. The primary reason for offering stocks to executives was for raising the share prices and thereby increasing its value for both investors as well as shareholders. Though this proved to be a major success, there were a few executives who would not disclose their stock options or would not make full use of the stock options offered to them. This caused inefficiency in the financial market. Stakeholders have the freedom to check their shares and to question the management if there were any discrepancies. Despite these constant checks with financial analysts, the board of directors, the panel of regulators, auditors and managers, there has been instances…… [Read More]
Corporate governance, a concept which has succeeded in attracting a lot of public interest due to its perceived importance for the corporations' and society' economic health in general has been accorded several definitions. Shleifer and Vishny (737) defined corporate governance as a concept that deals with the manner in which suppliers of various financial services to corporations somehow assure themselves of getting some good return on their investment. OECD (1999) on the other hand defines corporate governance as a system by which various corporations are effectively directed as well as controlled. The structure of corporate governance specifies the form of distribution of rights as well as responsibilities among various different participants in a given corporation. The participants include the board of directors, managers, stakeholders as well as the shareholders. The corporate governance structure lays down the rules as well as procedures to be used for making various decisions on the…… [Read More]
Both proposals were consequently amended and eventually accepted by the SEC.
The audit committee makes sure that the books aren't being cooked and that shareholders are properly informed of the financial status of the firm. Characteristically, the audit committee advocates the CPA firm that will audit the company's books, appraises the activities of the company's independent accountants and internal auditors, and reviews the company's internal control systems and its accounting and financial reporting requirements and practices. The compensation committee usually does the following: (1) recommends the selection of the CEO, (2) reviews and approves the appointment of officers who report directly to the CEO, (3) reviews and approves the compensation of the CEO and the managers reporting to the CEO, and (4) administers the stock compensation and other incentive plans. The suggested committee establishes experience for potential directors (Lunnie, 2007; pg. 90). It also puts collectively a list of candidates…… [Read More]
"hen Congress returned in 1934 to complete the federal disclosure tapestry, it created express private causes of action for misleading reports filed with the Securities and Exchange Commission (SEC) as part of the newly enacted continuous disclosure requirements, (3) provided private recoveries for market manipulation, (4) and authorized suits on behalf of reporting companies for short-swing profits garnered by certain insiders (Cox, Thomas, and Kiku, 2003)."
The creation of the SEC as a government body for oversight arose out a recognition by the courts that private action was not enough to protect investors and consumers from the materially misleading representations of corporate America (Cox, Thomas, and Kiku, 2003). Since its creation, however, the numerous laws and regulations that have come to frame the world of corporate governance have exceeded the limits of manageable governance. By the time the SEC has identified a problem, pursued investigation of the corporate representations of…… [Read More]
Corporate governance of finances in major corporations has been a major controversy during the recent recession. The scandal at Satyam is indicative of problems across the board, from CEOS, to executive boards, to independent auditors and even accounting firms such as Price Waterhouse. In this essay, the author will consider the unique problems presented in a globalised market where faith in the market is essential for international trade to function.
When the CEO assumes the entire responsibility in a corporate governance fiasco absolving everyone else (family members, board of directors, independent directors and other top management people), how should the regulatory authorities and the government proceed against the CEO who has confessed and other people who were absolved by him. Critically evaluate especially from the point-of-view of absolving all the others including the top management, board of directors and the family members, from any of the accumulated corporate wrongdoings.
What…… [Read More]
Communities are looking for social expenditures by the business to benefit the community (hospitals, stable employment, donations, and investments). Managers face a challenge in making such crucial decisions. Therefore, corporations must be clear on how to make tradeoffs between these often inconsistent and conflicting interests from different stakeholders.
In the Shareholder Wealth Maximization model, three types of maximization exist in a company. They include total stakeholder maximization, shareholder maximization and stakeholder-owner maximization. Shareholder maximization is based on a single stakeholder maximization whereby the sole business owner is taken into account during maximization. The stakeholder owner maximization focuses on desired interests and resources important for shareholders commitment. It is crucial for the overall success of the business venture (Tricker, 2012).
Of all the three-wealth maximization of companies, shareholder wealth maximization is more significant than the other two. While most businesses presume total stakeholder maximization to be the most significant role, it…… [Read More]
When a merger the size of the AOL ime Warner merger takes place and then disintegrates, it is time to look for what went wrong. Both companies were regarded as important in their fields; both had been successful, one for many years (ime Warner), the other for only a short while (AOL), but that success was extreme.
What did go wrong? he simple answer is that is was probably a classic clash of old paradigm vs. new paradigm.
In fact, the simple answer is the whole answer, and it appears in graphic detail on the 91st page of Alec Klein's book, Stealing ime: Steve Case, Jerry Levin, and the Collapse of AOL ime Warner. On that page, Klein describes the scrambling of the lawyers for both firms -- AOL and ime Warner -- when operation Alpha ango is revealed to them. (Both Case and Levin chose to keep…… [Read More]
The statement "What is worse is that it legitimizes the self-serving managerial behaviors" in the context of CEO pay. This statement I agree with as CEOs have used governance to rationalize giving themselves exceptionally large raises without accountability and governance in place. Conversely the statement "Furthermore, markets or organisational hierarchies are assumed to provide genuine alternative optimal or appropriate governance structures" in the context of the discussion at this point in the paper is inaccurate. Organisations in fact produce governance structures that are highly inefficient and lack the necessary framework and foundation to accomplish these goals. Instead there is the need for continually turning trust into an accelerator and engraining governance into companies, not legislating it from the outside. This is the fatal error of the statement shown.
This is a well-researched peer review article that has the potential to deliver entirely new governance frameworks with additional effort…… [Read More]
Corporate Governance and Ethical esponsibility
Dr. Doight recently hired President "Universal Human Care Hospital," oversees departments 5,000 employees 20,000 patients medical facility. He provided a broad set duties oversight numerous departments, including business development, customer services, human resources, legal, patient advocacy, a .
Corporate Governance and Ethical esponsibility
Duty of loyalty owed to internal and external stakeholders
According to Heath (2006)
, duty of loyalty entails good faith and honesty in best interests of a corporation's stake holders. The duty of loyalty involve the no-profit rule and no conflict rule Heath, 2006.
The duty of loyalty thus implies that, a person in-charge of overseeing the operations in an organization should not let his/her personal interest dictate performance of duty. It also governs actions which must be guided by honesty and good faith. A corporation's stake holders can be classified into two; internal and external Weaver, 2006()
Duty of Loyalty to…… [Read More]
" Thus this principle is founded on an individual's ability to predict a given action's consequences. On predicting such consequences, an individual is supposed to choose the course of action which would in the end benefit the greatest number of people. In such a case, the choice selected would be considered ethically correct. For instance, if one innocent person has to be killed so as to save the entire human race, then it would be ethically right to kill such a person from a utilitarian point-of-view. An application of this principle in our scenario seems somewhat straightforward. To determine the right course of action in this case, the question to be asked is; of all the alternative courses of action at Dr. Doight's disposal, which course of action would benefit the greatest number of people? In my opinion, seeking to ensure that the situation is brought under control no matter…… [Read More]
However, those who have serious ethical and moral integrity will generally do what it takes to get a problem corrected, even if they have to lose out personally or professionally to protect the health and welfare of other people under their care. It does not appear that Dr. Doight did any of that. He determined that following procedure was enough to fulfill his duties, whether or not that procedure resulted in any resolution for the patients.
It would appear that Dr. Doight followed the deontological argument that one only has to follow the rules to be ethical. For many people, that is an acceptable choice. For others, the rules would not be important and would not have anything to do with whether something was considered to be ethical. With Dr. Doight, it is not just the possibility that he feels he has done what is ethical, but also possible that…… [Read More]
Corporate Governance on Organizational Performance
Corporate governance implies to decisions made by the management in organizations, which influence the overall performance of the firm. Corporate governance focuses on organization's governance and the performance of duties within firms. Management of firms develops specific strategies or set of mechanisms that influence their decision-making. These decisions are crucial in firms where there is a clear difference in ownership and control. Some of the strategies the management team might use are employing the participation of the board of directors in decision-making, encouraging shareholders in the management of organizations or decisions made on market operations (Aguilera, Filatotchev, Gospel & Jackson, 2008). Decisions instituted by members of these teams directly influence the performance of the firm. Moreover, decisions tasks undertaken by the management and the shareholders contradict, but are very crucial to the overall performance of the organization.
Corporate governance is a highly powerful aspect to…… [Read More]
4. If Enron shareholders had been fully aware of the LJM partnership agreement, do you believe they would have been willing to continue investing in Enron?
LJM was created by Fastow allegedly to buy poorly performing Enron assets, but in reality to hide debt and inflate profits of Enron in order to leverage its stock price. It is almost certain that Enron shareholders would have ceased to continue investing in Enron had they been aware of the full significance of LJM.
LJM, in its essence, entailed that Enron was far below that which it's displayed to the public and that likely its debts were more massive and its profits far less than those claimed. Investors, obviously, would not want to invest in a poorly performing company.
Even if Enron's profits were higher and debts lower than those that the company tried to conceal, the very fact that Enron was not…… [Read More]
Moffett, M.H., Stonehill A.I., & Eitemen, D.K. (2012).
Fundamentals of multinational finance (4th Ed.). Boston, MA: Prentice Hall.
In completing these assignments the university requires that you follow APA guidelines and include (in-text citations) in preparing all works, citations, and references.
Each essay question response should be numbered, answered separately, and be at least 200 words (each question) in length but should be submitted as one file.
Some information has been added to responses. Please ONLY add to these responses and format correctly.
In your own words, contrast international financial management with domestic finance.
International financial management and domestic finance share many commonalities. Each deals with interest rates and making the best financial use of assets. However, in international financial management the primary difference is that there is also interest rate risk and risks associated with exchanges. When currencies float, the rate can be subject to volatile movements. For example,…… [Read More]
Financial egulatory Harmonization in East Asia
As globalization continues to evolve local economies, there has been increasing pressure put on East Asian nations to implement corporate governance reform. Many East Asian nations lack the restrictions and regulations seen in Western nations that provide for more responsible treatment of corporate activities that impact the health of businesses in that economy and attract foreign investment.. Moreover, the lack of corporate governance regulations have also been thought to have played a role in the 1997 Asian financial crisis, as there were not checks in place to curb corporate behavior that contributed to economic decline. In his 2010 article, "Financial egulatory Harmonization in East Asia: Balancing Domestic and International Pressures for Corporate Governance eforms," ichard W. Carney discusses how harmonization of international and domestic expectations of corporate governance in the region is possible.
The international community has long been putting pressure on East Asian…… [Read More]
Corporate governance failure is a serious threat to the future existence of any organization. The high corporate failure rates witnessed in the first decade of the century brought to the limelight the concept of effective corporate governance, and the core principles of trust and integrity. This text examines Wal-Mart's corporate governance strategy to determine how the company restrains managerial power, and how it aligns the interests of managers and directors with those of the organization.
Corporate governance failure is a serious threat to the future existence of any organization. Following the stream of corporate failures witnessed in the first decade of the century, the investor base has become more aggressive about effective corporate governance based on the core values of trust and integrity. Today, a company's ability to conduct its profit-maximization goal within the ethical boundaries of integrity, honesty, fairness is widely regarded as a source of competitive advantage. Towards…… [Read More]
Watpac Limited is an Australian Construction and Property Development company that is listed on the Australian Stock Exchange. The company was established in 1983 and has developed to become one of the leading firms in national construction, property development, and mining services. Watpac has a history that spans more than three decades of success and growth and employs over 1,350 people in various cities in Australia such as Brisbane, Sydney, and Melbourne ("About Watpac," n.d.). The firm's competitive advantage can be attributed to its diversified business strategy, the depth of its local expertise and networks, and mixing the strength of its national reach with balance sheet. The other significant element of its competitive advantage is its corporate governance that is based on certain policies and procedures.
Outline of the eview:
This analysis of Watpac Limited's corporate governance will be based on its 2013 annual report, which was a…… [Read More]
Clearly, he companies engaged in this practice were operating with direct intention, and a roper governance system would have made this obvious and prevented it.
In another telecommunications case, a company was found to have included spyware in a company-sponsored "software upgrade" to users' cell phones, that enabled the company to collect confidential information from users' phones without their consent (Khaleej Times, 2009). Not only is this practice clearly unethical, but it is also illegal despite a lack of stringency in the detection of such crimes and the prosecution of large-scale corporate offenders such as telecommunications companies. Again, greater transparency and internal control would have allowed this practice to be discovered much sooner, and the risk of discovery almost certainly would have prevented this action from ever occurring. Corporate governance works best when it is so strong it is only rarely and usually accidentally tested; when purposeful actions…… [Read More]
Ethics, Corporate Governance and Company Social esponsibility
OCED state-owned enterprises and Privatized companies
In the past few decades, emerging economies have launched ambitious plans to privatize their state owned enterprises (SOEs). The volume of privatization in emerging economies has increased from $8 billion in 1990 to about $65 billion in 1997 (Dharwadkar, George, & Brandes, 2000). In privatization, ownership is transferred from the state to new private and public owners, which may include management, employees, local individuals, institutions, and foreign investors, with the state also retaining a certain percentage of ownership after privatization. The new diversified ownership structure after privatization makes corporate governance an important issue in emerging economies (ajagopalan and Zhang, 2008).
On the one hand, the new ownership structure creates the traditional principal agency problem whereby self-interested executives aim to maximize their private interests rather than the owners' interests. To address this problem, it is necessary to design…… [Read More]
Irish Corporate Governance
"Irish Development NGOs," notes a 2008 associational guidebook from the Corporate Governance Association of Ireland (CGAI), "exist to create a better world. They operate on a global scale with diverse missions, but are united by a shared commitment to social justice and the eradication of poverty" (CGAI, Irish Development NGOs).
But as noble as these intentions are, they are coming up short in their missions because they do not have in place the kinds of effective and efficient types of governance expectations needed to ensure that they are being profitable in their own success. Many NGOs, just like many for-profit businesses, are struggling with extraordinary financial challenges. And they are finding out that just as they need to learn to be more effective in their operations, they have few guidelines in place for improving the services they provide and for professional conduct in general (CGAI, Irish Development…… [Read More]
Africa in general, and igeria specifically, are both going through turmoil and change on a daily basis. Companies and firms and even government entities are being forced to make changes in the way the govern and are governed. Current literature is ripe with examples such as the review that determined that "though high dispersed, both within and between firms, corporate in the selected countries are relatively not independent" (Kyerboah-Coleman, 2007, p. 350). Failures abound in many industries and corporate governance affects almost every area of business. There have even been "major failures in corporate governance at banks" (ew African, 2010, p. 63). Along with corporate governance, other factors are present such as the lack of technology. Once recent study determined that "except for the introduction of online registration by the Corporate Affairs Commission (CAC) in igeria, no serious integrative reform has been undertaken" (Bolodeoku, 2007, p. 107). Of course problems…… [Read More]
For example, Shu-Acquaye (2007) cites the basic differences in the legal systems in various parts of the world as contributing to the different approaches to corporate governance. Likewise, Shu-Acquaye cites these differences and adds, "The American corporate governance system adheres to the idea of shareholder primacy. Because the United Kingdom, Austria, and Canada share a legal system based on English common law and equity principles, they are similar to the United States -- shareholder primacy is the predominant norm in each of these countries."
By sharp contrast, other countries such as Japan and Germany are characterized by stronger protection for their employees, creditors, and other nonshareholder stakeholders in general, representing examples of a stakeholder-orientated system. In their book, the Control of Corporate Europe, Barca and Becht point out that, "Germany has always had a prominent place in the international corporate governance debate. The country is among the largest and richest…… [Read More]
The most important objectives proposed by the ICGN refer to shareholders. Therefore, it is recommended to optimize return to shareholders, which should become the most important objective for a company. In other words, "corporate governance practices should focus board attention on this objective. In particular, the company should thrive to excel in comparison with the specific equity sector peer group benchmark" (ECGI, 2005). Another objective refers to the long-term prosperity of the business. This requires the development and implementation of a corporate strategy that focuses on increasing the equity value on a long-term.
Another recommendation refers to facilitating the exercise of ownership rights by all shareholders. In relation to this, all shareholders must be treated equitably. One of the most important recommendations refers to increasing the shareholders' possibility to be a part in the decision making process for matters of extreme importance to the company's activity.
The importance of corporate…… [Read More]
The company showed a global reach early, adding numerous language versions around the world. In 2000, the company reached 18 million search queries per day and officially became the world's largest search engine ("Google, Inc." paras. 11-14).
The company now sought to address its need for income by introducing a keyword-targeted advertising program for another source of revenue. The company partnered with Yahoo! And with other partners, such as China's leading portal NetEast and NEC's BIGLOBE in Japan. Google introduced Adords, a self-service advertising program that could be activated with a credit card. By December of 2000, Google received more than 60 million searches per day and reached the 100-million search mark per day in 2001 ("Google, Inc." paras. 15-16).
Google as a Public Company
Google would offer an IPO of stock beginning in 2004. McShane and Von Glinow cite Google as a successful company, especially in terms of navigating…… [Read More]
Ethics, Corporate Governance and Company Social esponsibility
Information that is essential to share includes financial performance, business strategy and overall company actions (Pfeffer, 1998). Sharing this information gives the employees the power to evaluate their performance and help them make the right decisions on how they can improve it. This is a simple and very straightforward practice but most companies are still apprehensive about this practice. One cause for this is that information is power and by sharing essential information like financial performance the management is scattering that power. Another reason is that the management is concern about information escaping to competitors. This will put the organization in an unfavourable position. But what companies do not realize that the competition most probably already know this information. Thus if a company withheld information they are only leaving their own employees in the dark. Because of this, employees will reply on speculation…… [Read More]
Every company has corporate governance initiatives in place. Consider that corporate governance simply refers to how the company is run and controlled. The current usage of the buzzword derives from the issues that a few companies had where executives or managers were not subject to appropriate levels of governance. Thus, the guidelines issued recently by the OECD, the ASX, the Combined Code and in Sarbanes-Oxley serve to institutionalize stronger corporate governance policies in order to strengthen public confidence in capital markets. Most companies would already be following these guidelines.
For example, the first category covered by the Combined Code is about the Board of Governors. Boards of Governors have always been responsible for corporate governance -- for our company not to have any governance policy would imply that it does not have a Board. hat is recommended is that the Board has specific features and structures. One recommendation…… [Read More]
Because lending institutions stood to lose anytime borrowers defaulted on a loan, lenders always engaged in a very careful process of ensuring that loan applicants were capable of repaying any debts they sought to take on (Phillips, 2008).
Deregulation shortly before the turn of the century eliminated the self-interest basis of rejecting risky debtors, leaving only legal and ethical obligations to exercise due diligence in good faith (Phillips, 2008). Unfortunately, mortgage lenders throughout the nation began issuing loans irresponsibly and often without any collateral or interest due on the loan. Since they intended to sell off the obligation anyway, they had little concern for what might happen subsequently. Likewise, home realtors and mortgage brokers began aggressively soliciting business from customers unethically, often by exploiting their ignorance about variable-rate mortgage loans. Unfortunately, this process also triggered an artificial housing bubble based largely on inflated property value statements and those overvalued but…… [Read More]
Ahli United Bank story started, we have been increasing together. We registered our own course, shaped our own story, and boarded upon a journey of achievement for the previous 15 years and plus. We cultivated home-grown capacity, concerned world class knowledge and protracted our reach across sectors and borders. We constructed monetary strength, reinforced by a well-defined plan and a great agreement of discipline, heavy labor and promise. But then again most prominently, we joined and linked with uncountable meticulous and inspirational men, women and industries, helping them prosper and grow and receiving their trust every phase of the way. In addition, in the progression, we turn out to be the strong, trusted and locally growing financial organization that we are these days.
This report is important particularly since the requirement from the Central Bank of Kuwait has mandated that it be done and noncompliance will result in high penalties.…… [Read More]
Corporate Governance & Business Ethics
It is quite interesting to note that, academic research in business ethics was a totally distinct discipline from research in corporate governance, and the application of the word 'ethics' was uncommon in available research on corporate governance. The chief responsibility of corporate governance was understood to be safeguarding the benefits of the shareholders. Because of the severance between ownership and management, and the incapability of the independent owners to supervise the performances of those managers, a possibility was available for vital strategic decisions to be taken which would advantageous for the managers to a more larger extent compared to the owners. For example, takeovers not related to the organization's core competence outcome in a bigger corporation, however, it does not result in a more profitable company all the time. Certainly, research has proved that extremely increased extent of isolated diversification normally resulted in lower…… [Read More]
Global Corporate Governance and Social Responsibility
An in-depth analysis of all possible factors responsible for the Social efforts
Socio-Economic, Cultural, Technological and Legal Factors
Strategic ideas involved in addressing corporate social responsibility issues
The Unique Composition of Microsoft
Creating etter-Quality Products
Using Conventional and Contemporary Resources
In recent years, augmented degree of interest has been shown on the subject of "Corporate Social Responsibility," also known as "CSR." This interest has been shown, both in the international/national business and academic circles, because almost all the current studies indicate that "Corporate Social Responsibility" increases the credibility of the business in the eyes of the stakeholders, both within and outside the organization (Isabelle and David, 2002).
Another reason for the increased interest being shown in the direction of "Corporate Social Responsibility," both by international/national business and academic circles, is because of the constant emphasis by the global society towards…… [Read More]
In contrast, within the firm, the entrepreneur directs production and coordinates without intervention of a price mechanism; but, if production is regulated by price movements, production could be carried on without any organization at all, well might we ask, why is there any organization?" (Coase, 1937, p. 387) In simpler words if markets are so efficient why do firms exist? Coase explains, "the operation of a market costs something [such as the costs of negotiating and concluding a separate contract for each exchange transaction] and by forming an organization and allowing some authority (an "entrepreneur") to direct the resources, certain marketing costs are saved" (Coase, 1937, p. 391). Thus, firms actually present greater efficiency over markets by decreasing such costs.
That being said, if firms are so efficient, why are markets needed? (Coase, 1937). As per Coase, as the firm grows (when the entrepreneur processes additional transactions), decreasing returns to…… [Read More]
This method is congruent with Fraenkel and Wallen (2001) who note, "esearchers usually dig into the literature to find out what has already been written about the topic they are interested in investigating. Both the opinions of experts in the field and other research studies are of interest. Such reading is referred to as a review of the literature" (p. 48). A critical review of the literature can also provide other benefits as well. For example, Wood and Ellis (2003) identified the following as important outcomes of a well conducted literature review:
1. It helps describe a topic of interest and refine either research questions or directions in which to look;
2. It presents a clear description and evaluation of the theories and concepts that have informed research into the topic of interest;
3. It clarifies the relationship to previous research and highlights where new research may contribute by identifying…… [Read More]
However, because of the costliness of this requirement, many believe it is especially unfair to small businesses who are already struggling to be competitive in an increasingly hypercompetitive, globalized economy.
As such, small, public companies have been given a temporary reprieve from some of Section 404's strict and costly requirements. In addition, there have been new guidelines set forth for auditors, with a hopes of reducing the cost of compliance of the Section, for all companies (Basilio, 2007; Grumet, 2007).
Bradford and Brazel (2007) note that these costs due indeed seem to be decreasing. In research they quote from AM, organizations spent $4.5 million on compliance with the Act, in 2004. This was reduced to $3.8 million in 2005, and further decreased to $2.9 million in 2006.
However, despite these decreasing total costs of compliance, the Act is still a costly requirement for public companies. Bradford and Brazel (2007) further…… [Read More]
BP Oil Spill
Strategy and Corporate Governance
The bp oil spill of 2010
British Petroleum (BP) is one of the largest oil exploring companies in the world. It is recognized for its efficient practices. In recent years it has positioned itself as an environmentally responsible company by stressing its commitment to undertaking exploration activities by causing minimum harm to the natural environment. It has also invested in technologies to make drilling under the seabed more secure so that oil spills do not occur. However, these claims were brought into question on April 20, 2012 when a massive explosion and oil spill took place on the Deepwater Horizon oil rig over the Macondo oil well in the U.S. Gulf. There was huge damage to the marine environment and to the livelihood of people living in the coastal communities in Louisiana and other coastal states. The poor response of the company was…… [Read More]
In such situations, "especially if the comments have been made repeatedly" the employer may not be able to fire the employee at will. This seems to be the case with Joe, given the statements he received from his supervisors (Nolo, 2010). In the future, it would be wise for the Strong Steel Company to be careful about making such sweeping statements to employees, to protect the company's interests should the employee use such statements as evidence that they could only be fired with a 'cause.'
Even if the employer argues that there was no implied contract about his employment status, Joe's firing seems clearly linked to his ADA-qualified disability, given that he was told, after he returned to his employment after his operation that his employer felt that Joe was not doing a good job because of his heart problems. Joe, however, had only taken part-time leave for a relatively…… [Read More]
wikipedia.org/wiki/Manager, last accessed on September 28, 2007
Mark Hillon, Chaos and Complexity, Storytelling Organization, http://www.horsesenseatwork.com/psl/pages/chaosdefined.html, last accessed on September 28, 2007
David E. Wojick, Chaos Management and the Dynamics of Information: A New way to Manage People in Action, Washington DC, http://www.bydesign.com/powervision/Mathematics_Philosophy_Science/Chaosman.html, last accessed on September 28, 2007
Scott Love, October 13, 2004, Chaos Management for the Resilient Leader, Asheville, http://www.expertclick.com/NewsReleaseWire/default.cfm?Action=ReleaseDetail&ID=7315,last accessed on September 28, 2007
Robert Heller, July 8, 2006, Entrepreneurial Management: What's the difference between management and entrepreneurship?, Thinking Managers, http://www.thinkingmanagers.com/management/entrepreneurial-management.php, last accessed on September 28, 2007
22 August 2006, Entrepreneurial Management, oise State University, http://mg.boisestate.edu/entrepmanagement.htm, last accessed on September 28, 2007
ruce Tulgan, April 10, 2007, the Undermanagement Epidemic: Hiding in Plain Sight, http://126.96.36.199/search?q=cache:LEWzz37AT1kJ:www.ipa.org/pdf/2007-02hr.pdf+undermanagement&hl=en&ct=clnk&cd=5&client=firefox-a, last accessed on September 28, 2007
Daniel Goleman, October 20, 2006, Cram 101 Textbook Outline for Primal Leadership: Learning to Lead With Emotional Intelligence, First edition, AIPI Publishing
Management Styles, Rensselaer Polytechnic Institute…… [Read More]
CIO in Effective Information
Technology Strategic Planning through Corporate Governance
Corporate governance can be defined as the governing structure which allows a board of directors to ensure transparency, quality, accountability and fairness within a firm and in their relationships with their stakeholders (Monks & Minow, 2011).
The corporate governance structure constitutes of:
Direct and indirect engagements between a firm and its various stakeholders.
Measures for integrating the often incompatible interests of stakeholders.
Measures taken for appropriate administration, management, and flow of data to function as a framework of check and balance (Monks & Minow, 2011).
The aim of corporate governance is to enable operative, innovative and sensible management that can add to the long-term success goals of the firm. Companies are streamlined and managed by the use of corporate governance. While the board of directors forms the controlling body, it is the responsibility of the stakeholders to select…… [Read More]
" A unified strategy begins at the fundamental education level, students who will become the future corporate leaders and operators must be taught at an early age to have strong business ethics and values. The lack of such education is an essential cause for why corporate abuse is rampant in the world today. In 1980, a survey conducted USA Today asked Harvard Business School graduates what their top career priority was, an overwhelming 85% answered to "make money." This statistic is emblematic of the corporate culture for the past two decades. Changes within the education system to reinforce the importance of values at the collegiate and graduate level will have a profound impact on corporate leaders of the future. Evidence of this can be seen in another recent USA Today survey. When the same survey was presented to Harvard graduates in 2004, only 42% answered that money was their number…… [Read More]
" (p. 4) This is to make the argument that it should be seen as a practical reality of this new business atmosphere that responsibility to the social realities and standards of an operational setting will be directly predictive of long-term survival, stability, functionality and survival.
That stated, it should also be seen as incumbent upon the global alliances created by the process of free trade to impose standards of corporate social responsibility vis a vis labor standards, wage equality and environmental protections. By taking this step, the world community can help to ease the financial burden placed upon those companies which aspire to engage in the global economy without eschewing positive corporate values.
Kahler, M & Lake, DA 2001, 'Globalization and governance,' IGCC. ead online Aug. 9, 2010 < http://igcc.ucsd.edu/research/intl_political_economy/gandg.html>.
Lockwood, N 2004, 'Corporate Social esponsibility,' Society for Human
Smith, H 2004, 'Who calls the shots…… [Read More]
Summary of the purpose of Corporate Sustainability Reporting
Reporting corporate sustainability is one of the best ways to ensure that a company is not only doing well financially in the present but also in securing a better and more certain future. The reporting of corporate suitability ensures that the current needs of the organization are effectively met without comprising future needs of the organization. Reporting on corporate sustainability also ensure that organization are able to keep up with all changes in the industry, with ensuring that new innovations have been developed, maintained and employed in the daily operations of the organization. Corporate sustainability is developed on a grid developed to ensure that the future is secure, and that the organization will survive for a long time.
Corporate sustainability also encompasses the assessment of current and future risks that the organization is likely to endure. As such, a majority…… [Read More]
A corporation is a form of business structure. The corporation is given the same basic rights and duties as an individual. This shields members from the corporation from some liability for the corporation's actions, but also prevents them from utilizing corporate assets in the same way that one would use personal assets. There are some differences between publicly held and privately held corporations; however the basic structure of a corporation remains the same regardless of how the corporation is held. There are three main groups in the corporate structure. The first group consists of the directors of the corporation. The second group consists of the officers of the corporation. The third group consists of the shareholders of the corporation. Individuals may belong simultaneously to more than one of these groups, but each group has different responsibilities.
The first group consists of the directors of the corporation. When forming…… [Read More]
Corporate Social and Environmental eporting
Companies have presented investigations about their motivation towards voluntarily social and environmental as insolvent. This paper argues in agreement with Adam's view that the goal of CS reporting is to promote credibility and corporate image of stakeholders operating in a particular industry. Whereas companies must focus their efforts on enhancing their profitability, they should also ensure that the welfare of other stakeholders is protected.
Previous literature offers a revelation on various competing theories based on why companies make voluntarily report and engagements in corporate social responsibility. The major perspectives considered are within the scope of application include accountability and image promotion. Many studies hold consequential evidence towards accountability to shareholders making it difficult for organizations to distinguish relevance from accountability based on continued practice. The absence of actual legitimacy crises makes it hard to identify voluntarily reporting as a proactive measure in preventing future crises…… [Read More]