Premium Essay

Corporate Fovernance

In: Business and Management

Submitted By Wubby92
Words 2159
Pages 9
Corporate governance

Why study governance?
-Failure of companies


1. Definitions and Evolution of the cultural and legal environment

* Way of sharing the power between management and shareholders.

* Corporate governance is a set of legal, regulatory or practical provisions defining the scope of the power and responsibilities of those responsible for directing the company sustainably. Directing the company means taking and controlling the decisions that have a decisive effect on its soundness and sustainable performance.

3 types of shareholders: speculative, sleeping, active

2. The history of share ownership in continental Europe

From 1850 to 1930 :

1/ Company : private sphere * Private property * Family shareholders * Middle age vocabulary

2/ Governance mode: Paternalism * Statistically and ideologically dominant * Scté en commandite par action * Authority legitimacy : Traditional society

From 1930 to 1970

1/ Paternalism legitimacy erodes … * 4 constraints: * Demographic * Organisational * Financial * Political

2/ Governance of “experts” * The emergence of technocracy * Marginalization of shareholders * Anonymity * Technocracy self evaluation
Since 1970

1/ Mutations and revolutions in the USA

a- The increase of the need for financing * Diversification of pension funds * Huge increase pf the capital markets: the capitalization of NY increases from 600 to 17000 billions dollars between 70 and 2000

b- The huge increase of the number of shareholders * Mass saving world wide phenomenon: * about 80 milion direct s

c- The implication of Financial institutional intermediaries * Big investors * Emergence of lobby groups * Knowledge is shared : Legitimacy of the manager…...

Similar Documents

Premium Essay

Corporate Citizenship

...Corporate citizenship is a term used to describe a company role in the society, many times people has changed the name for social responsibility of the corporations and in one way it´s true but we are missing a very important part in it definition, the part we are missing is that companies are like a citizen with a territory so they have their assets and they can sue or be sued, and when you seen the corporate citizenship like this you can understand that also the companies has all the rights that the people has, for example the right of free speech, participate in the politics of the country where they are and other rights that everyone has, but this is only in some countries because in another countries the companies are the ones who have to do everything and the country or government doesn´t give any right or benefit to them. The corporate citizenship has been present from many years or decades ago but only from 2000s many companies start to enter in this title if we can say it like this, this happen because in many countries the people start to buy the ideas that those companies that were social responsible were better than the others ones, so this become in a competition. The government also helps and gives many benefits to the companies that where social responsible and with this everyone wants to be a corporate citizenship and start many programs or regulations to become one. There are three ways to see the corporate citizenship in the world and this theory or......

Words: 577 - Pages: 3

Premium Essay


...COVER SHEET for SUBMISSION of INDIVIDUAL/ GROUP ASSIGNMENTS Course Code | Course Name | Dept. Date Stamp | ACCT2159 | Corporate Accounting | | Assignment Title | Assignment No: | Date Due | | Corporate Accounting Assignment 2012 semester 3 | 1 | Friday, 7th December 2012 | | Academic’s Name: | | | Ms. Sue | | (For Office use only) | STUDENT(S) Family name | Given Names | Student Number | 1) Vu Ly Bao | Ngoc | s3357828 | 2) Bui Mai | Phuong | s3372823 | 3) Nguyen Thi Phuong | Mai | s3345216 | 4) Lee | So Huyn | s3357820 | Declaration and Statement of Authorship: 1. I/we hold a photocopy of this assignment which can be produced if the original is lost/damaged. 2. This assignment is my/our original work and no part of it has been copied from any other student’s work or from any other source except where due acknowledgement is made. 3. No part of this assignment has been written for me/us by any other person except where such collaboration has been authorised by the academic/teacher concerned and as detailed in the assignment. 4. I/we have not previously submitted this work for any other course/unit. 5. I give permission for my assignment to be scanned for electronic checking of plagiarism. 6. I give permission for a copy of my/our marked work to be retained by the Department for review by external examiners. I/we understand that: Plagiarism is the presentation of the work, idea or creation of......

Words: 3220 - Pages: 13

Premium Essay


...American English, the word company can include entities such as partnerships that would not be referred to as companies in British English as they are not a separate legal entity. Despite not being human beings, corporations, as far as the law is concerned, are legal persons, and have many of the same rights and responsibilities as natural people do. Corporations can exercise human rights against real individuals and the state,[5][6] and they can themselves be responsible for human rights violations.[7] Corporations can be "dissolved" either by statutory operation, order of court, or voluntary action on the part of shareholders. Insolvency may result in a form of corporate failure, when creditors force the liquidation and dissolution of the corporation under court order,[8] but it most often results in a restructuring of corporate holdings. Corporations can even be convicted of criminal offenses, such as fraud and manslaughter. However corporations are not considered living entities in the way that humans are.[...

Words: 337 - Pages: 2

Premium Essay


...Corporate governance refers to the set of systems, principles and processes by which a company is governed. They provide the guidelines as to how the company can be directed or controlled such that it can fulfil its goals and objectives in a manner that adds to the value of the company and is also beneficial for all stakeholders in the long term. Stakeholders in this case would include everyone ranging from the board of directors, management, shareholders to customers, employees and society. The management of the company hence assumes the role of a trustee for all the others. Corporate governance is based on principles such as conducting the business with all integrity and fairness, being transparent with regard to all transactions, making all the necessary disclosures and decisions, complying with all the laws of the land, accountability and responsibility towards the stakeholders and commitment to conducting business in an ethical manner. Another point which is highlighted in the SEBI report on corporate governance is the need for those in control to be able to distinguish between what are personal and corporate funds while managing a company. Fundamentally, there is a level of confidence that is associated with a company that is known to have good corporate governance. The presence of an active group of independent directors on the board contributes a great deal towards ensuring confidence in the market. Corporate governance is known to be one of the criteria that......

Words: 3550 - Pages: 15

Premium Essay


...CSR Intro, companies "actively" involved Corporate social responsibility is a form of corporate self-regulation integrated into a business model. CSR policy functions as a built-in, self-regulating mechanism whereby a business monitors and ensures its active compliance with the spirit of the law, ethical standards, and international norms. CSR functions strive to strike a balance between the economical & the strategic impacts of the organization, trying to decrease the negative environmental impact and increase the competitive edge of the organisation with a sense of sustainable development. Many companies have now affiliated themselves with this term. So, as a result Corporate social responsibility is gaining a lot of buzz these days. In recent years, many companies have incorporated CSR as a core component of their business philosophy, but I think there’s a big difference between being committed to the concept and actually doing CSR effectively, either from the perspective of the business or the social issues that are being addressed. causes for implementation, environmental pressures CSR really grew out of activist movements some 30 or 40 years ago that began to put pressure on businesses to try and be more responsible for any of the harms, be it environmental, social or labour issues that they were creating through their operations. But because of that origin, it really evolved in a very defensive manner. started off as a defensive stance The external activist......

Words: 349 - Pages: 2

Free Essay


...Essay Introduction: With the emergency of more and more stock corporate, an increasing number of people become shareholders. However, in some companies, directors or majority shareholders misuse their power to maximize their own interests while exploiting minority shareholders. This phenomenon is more serious in proprietary companies since directors and majority shareholders don’t need to comply with ASX listing rules[1] and minority shareholders are unlikely to be provided a market to sell their shares. Ultimately, they have to sell their shares to majority shareholders in an unfair price or sue the majority shareholders paying expensive litigation fees. By contrast, in public listed companies, this phenomenon is relatively rare since there is a market for minority shareholders to sell their shares and the company’s affaires are supervised by the public. To avoid being treated oppressively or unfairly, the Corporation Act provides a wide range of statutory remedies for minority shareholders. This essay will introduce some of the unfair or oppressive conducts and remedies available for minority shareholders to deal with these conducts. Oppressive and unfair conducts and available statuary remedies: Majority shareholders misuse their power for their own interests through many ways which are oppressive and unfair towards minority shareholders, an example of these conducts is diverting business opportunities from company. Some majority shareholders take advantage of......

Words: 1997 - Pages: 8

Premium Essay

Corporate Transparency

...lack transparency in their business operations, financial statements or strategies. Corporate transparency has been an ever-growing concern between the investment sector as well as the general public due to recent accounting and corporate scandals, during 2001 and 2002 in particular. These accounting scandals have provoked regulators and investors alike to raise serious questions about the credibility of corporate financial reporting and the ethical implications impacting international economic vitality and social wellbeing. Purpose and scope: The objective of this report is to use specific cases in which transparency was obscured to demonstrate the correlation between lack of transparency and scandal and provide that increasing standards for Corporate Transparency makes business practices not only more ethical, but also more efficient. Part I of the report will present the relevance of transparency with a global snapshot of corporate transparency as it exists in present-day international markets. Part II will examine differences between standards of corporate transparency between the United States and Europe and discuss the market impact of regulations passed to increase corporate transparency. Transparency: A Global Snapshot Financial transparency is the fundamental factor driving the decision-making process for investors around the world; however, the current situation concerning corporate disclosure of financial information demonstrates how few multinational......

Words: 1589 - Pages: 7

Premium Essay

Corporate Culture

...When people talk about stories behind companies, corporate culture and corporate identity are always two important topics people will refer to. Some worldwide well-known brands, such as Apple, Samsung, Nokia or Enron, corporate culture and corporate identity have an enormous impact on their way to big names or final bankruptcy. This essay attempts to explain the background to organisational culture, the definition of corporate identity, and then to explore how does corporate identity affect and how is it affected by corporate culture in more detail via using Apple as an example. A summary and conclusion will be drawn at the end of this essay. Background to organisational culture Organisational culture is a complex and multi-facet conception. The notion of organisational culture has been explored by social scientists over the past decades. Andrew Brown stated the definition of organizational culture in his book Organizational Culture as follows: “Organizational culture refers to the pattern of beliefs, values and learned ways of coping with experience that have developed during the course of an organization’s history, and which tend to be manifested in its material arrangements and in the behaviours of its members.”1 According to Ravasi and Schultz, organizational culture is a set of shared mental assumptions that guide interpretation and action in organizations by defining appropriate behaviour for various situations.2 Martins and Martins thought......

Words: 1805 - Pages: 8

Premium Essay


...CORPORATE REPORTING AND ANALYSIS By Dr. S.A.S. ARUWA[1], CNA ____________________________________________________________________ Being a paper presented at ANAN Practitioners’ Forum at Mainland Hotel, Lagos on 3rd August, 2010 ____________________________________________________________________ Abstract Good corporate reporting is generally an indication of competitiveness and superior corporate governance. Good reports show initiative and effort on the part of the preparers. Significant changes in the corporate external reporting environment have led to proposals for fundamental changes in corporate reporting practices. A variety of new information types are been demanded, in particular forward-looking, non-financial and soft information. Openness and transparency in annual reporting on an unprecedented scale may be inevitable with the adoption of International Financial Reporting Standards (IFRS) and Nigeria’s commitment to adopt IFRS; Nigerian companies will have no alternative but to bring themselves up to speed. One way is to ensure that company’s reports actually reflect good governance. INTRODUCTION Good corporate reporting is generally an indication of competitiveness and superior corporate governance. Good reports show initiative and effort on the part of the preparers. “The better reports always address all the required relevant information concisely, and disclose thoroughly the measures taken – including on activities, corporate policy, strategic......

Words: 9556 - Pages: 39

Premium Essay


...coporateCompanies Act, 2013 Key highlights and analysis Significant changes and implications Companies Act, 2013 1 Contents 04 | Introduction 06 | Key definitions and concepts 10 | Setting up of a company 16 | Management and administration 18 | Directors 24 | Accounts and audit 30 | Dividend 32 | Compromises, arrangements and amalgamations 34 | Revival and rehabilitation of sick companies 36 | Corporate social responsibility 38 | Implications on private companies 40 | Other areas 44 | Sections notified till date and circulars or orders issued Foreword The long-awaited Companies Bill 2013 got its assent in the Lok Sabha on 18 December 2012 and in the Rajya Sabha on 8 August 2013. After having obtained the assent of the President of India on 29 August 2013, it has now become the much awaited Companies Act, 2013 (2013 Act). An attempt has been made to reduce the content of the substantive portion of the related law in the Companies Act, 2013 as compared to the Companies Act, 1956 (1956 Act). In the process, much of the aforesaid content has been left, ‘to be prescribed’, in the Rules (340+) which are yet to be finalised and notified. As of the date of this publication, 99 sections have been notified and a few circulars have been issued clarifying the applicability of these. We are pleased to bring you our new publication, Companies Act, 2013: Key highlights and analysis. This publication brings out the significant changes proposed by the 2013 Act as compared to......

Words: 22714 - Pages: 91

Premium Essay

Corporate Governance Corporate Governance and Performance of Saudi Arabia Listed Companies Yahya Ali Al-Matari Faculty of Accountancy, Universiti Utara Malaysia Dr. Abdullah Kaid Al-Swidi College of Arts & Sciences, Universiti Utara Malaysia, and Assoc. Prof. Dr. Faudziah Hanim Bt Fadzil Faculty of Accountancy, Universiti Utara Malaysia Abstract: This study aims to provide a concise view of the background of Saudi Arabia‟s legal system, important regulations and monitoring policies related to the corporate governance followed by the Saudi government to enhance the attractiveness of the business environment. In so doing, this study attempted to provide an overview on corporate governance in the emerging markets and more specifically in Saudi Arabia. Additionally, this study has shed lights on the main monitoring devices which play a significant role in regulating and developing the Saudi business environment. The focus was on some corporate governance mechanisms that might affect firm performance including board composition (BODCOM), CEO duality (DUAL), board size (BSIZE), audit committee independence (ACIND), audit committee activities (ACMEET) and audit committee size (ACSIZE). Keywords: Corporate governance, firm performance, emerging countries, Saudi Arabia. 1 British Journal of Arts and Social Sciences ISSN: 2046-9578, 1. Introduction The topic of corporate governance is......

Words: 15071 - Pages: 61

Premium Essay

Corporate Social Responsibility and Corporate Image

...ISSN 1857-8047 CORPORATE SOCIAL RESPONSIBILITY AND CORPORATE IMAGE Ayanda, Adebayo Maruf Department of Business Administration and Management Technology, Faculty of Management sciences, Lagos State University, Ojo, Lagos- Nigeria. Baruwa, Akinfolarin Afeez Department of Business Administration and Management Technology, Faculty of Management sciences, Lagos State University, Ojo, Lagos- Nigeria Abstract This article analyses the impact of corporate social responsibility on corporate image, basing the findings theoretically and empirically. The first part of this article focuses on a theoretical concept of corporate social responsibility. The authors analyze different definitions of corporate social responsibility, review chronological development of this concept and reveal similarities between different definitions. Positive and negative positions towards corporate social responsibility are presented and compared. The second part of this article reveals the theoretical concept of corporate image and the constituting factors. After discussing different definitions of corporate image, concluding remarks are made. The authors of this article discuss the topicality of corporate image management subsequently and name the factors that form corporate image, laying out the basis to manage particular factors. The first two parts of this paper provide a theoretical basis for further discussion. The third part of this article outlines insights for causality between corporate social......

Words: 7229 - Pages: 29

Premium Essay


...manufacture, sale and marketing of soft drinks, dairies, non-carbonated beverages as well as property. With a unique blend of quality and innovative products that have stood the test of time, the F&N brand has resonated with Malaysians for over 128 years. The company has come a long way since 1883 when John Fraser and David Chalmers Neave formed The Singapore Straits Aerated Water Company. Years later, F&N was consolidated and the company’s love affair with the food and beverage industry began. Our corporate milestones include, among others, the pioneering and launching of the sweetened condensed filled milk in 1973, launching of a complete range of ice-cream products in 1974, the launch of 100 Plus isotonic drinks in 1984 , and the acquisition of Nestle’s canned milk business in Thailand and Malaysia in 2007. Not one to rest on their laurels, F&N continues to soar to greater heights and remains committed to upholding the highest standards of corporate governance through integrity, transparency and accountability. F&N also remains responsible to their employees, business partners, stakeholders and the community; the company implements various initiatives to ensure responsible practices are carried out in all areas of the F&N business. In Malaysia, F&N operates under the banner of Fraser &Neave Holdings Bhd (F&NHB), which is the Malaysian arm of Fraser And Neave, Limited. The company is listed on Bursa Malaysia and employs nearly......

Words: 4316 - Pages: 18

Premium Essay


...usive use at Foundation for Liberal and Management Education (FLAME), 2015 2095 MAY 1, 2008 W. EARL SASSER HEATHER BECKHAM Thomas Green: Power, Office Politics, and a Career in Crisis Another long day at the office had drawn to a close. Thomas Green felt the pulsing in his temples that usually preceded a migraine. As he stepped outside Dynamic Displays’ corporate headquarters in Boston, the brisk air made him catch his breath. It was now February 5, 2008. Green could not believe that in five short months his dream promotion had turned into a disaster. When Green had been promoted to his new position in September, he was a rising star. Now, he would be lucky to celebrate his one-year anniversary with the company. His boss, Frank Davis, had sent the division vice president, Shannon McDonald, two scathing emails criticizing Green’s performance. Green and Davis had yet to see eye to eye on work styles or market trends. Tension had also risen when Green did not enthusiastically endorse the sales forecasts made by Davis. Green felt the forecasts were either overly optimistic or outright fabrications. Before he left for the day, Green had reread the series of emails regarding his performance and was certain that Davis was setting him up to be dismissed. Davis’s most recent email had made it clear to Green that his position as a senior market specialist was in jeopardy. He did not have much time to rectify the situation. McDonald had emailed a formal request to him that afternoon,...

Words: 5330 - Pages: 22

Premium Essay

Corporate Governance

... Business Foundations BIB 1A CORPORATE GOVERNANCE “What is Corporate Governance? Why is it important for Business?” The business environment is formed of complex interrelationships among and between companies of the same industry. With the process of globalization taking place in the business community, in different countries, all around the world, good ethical practices have become almost crucial to every business transaction, and work on effectively operating in the global market. Therefore, in order to gain credibility and a good position in the international field, values such as trust, responsibility and integrity are important between transacting business corporations. Thus, laws and policies that protect the interests of companies and corporations have been put into effect due to a “standardization of the code of ethics” in the corporate world. This has led to the creation of a better attitude among business establishments, accredited on the corporate governance applied within the company. The main goal of this paper is to explain what corporate governance is, to develop its principles, mechanisms and controls, and its efficiency in the world of business. The OECD Principles of Corporate Governance states: "Corporate governance involves a set of relationships between a company’s management, its board, its shareholders and other stakeholders. Corporate governance also provides the structure through which the......

Words: 911 - Pages: 4