Corporate Governance Benchmarking

Another central feature of the board of directors is the question of whether the CEO is also the chairman of the board. When the CEO is also the chairman this is often referred to as “CEO duality”. In the US the CEO is often the chairman of the board. Studies have shown that the board in most cases

There are laws in place to reduce the chances of an employer firing an employee based on their race, gender, disability, or sexual preference. Throughout the scandal, Kozlowski fired multiple employees without any warning or write up when he discovered that some of the revenue goals were not met after a company was acquired or they merged with another organization. Besides that, anyone whom gave a negative review or spoke negatively about Tyco had a strong possibility of being fired by Kozlowski. David Tice was vilified by Kozlowski for short selling Tyco. He worked for Prudent Bear and was only doing his job when he spoke out negatively about Tyco’s use of large reserves during acquisitions. That’s not the only instance, Jeanne Terrile, a former employee of Tyco was removed from covering Tyco as an analyst for Merrill Lynch because she refused to upgrade Tyco after the rapid amount of acquisitions and mergers. Also, the way Kozlowski handled his employees can be seen as over stepping his boundaries as CEO. He abused his legitimate power by treating the followers unfairly if he did not like the way business was being conducted or the company’s profits were not where they were supposed to be. Kozlowski implemented expert, legitimate, and coercive power to influence the outcomes he wanted and to get rid of any subordinate or analyst portraying Tyco in a

The purpose of this paper is to evaluate the legality and ethicality of the corporate governance activities that occurred in an ethics case presented in the text. The paper will provide relevant details regarding the legality of the activities, the criteria by which Sarbanes-Oxley would apply to this case, the ethicality of the activities, whether or not the activities were equitable to internal and external stakeholders, and the next steps representing best interest of all stakeholders.

In improving a publicly traded company’s bottom line Sarbanes-Oxley can be a positive factor. By introducing ethics codes and internal controls and building an ethical mind-set in a

Ethical leadership is vital for the success of any business; this case study illustrates that the lack of moral values and a healthy ethically incline corporate culture, can lead to scrupulous behavior from the CEO all the way down the company. Scrushy had a demanding and cunning personality, and it was easy for his to influence others in his business to go along with the fraud. Also, having Stanwick and Stanwick, (2013) an active board of directors does have a positive impact on the performance of the firm. Also, good corporate governance supports the ethical requirements established by the stakeholders. A moral leader must cultivate a real ethically driven organization, which has no tolerance for unethical behavior.

Phenomenal growth of interest in corporate governance has emerged in recent years. The body of literature on the subject has grown markedly in response to successive waves of large corporate failures. Furthermore, there have been numerous attempts to define what constitutes ‘good corporate governance’ and to provide guidelines in order to enhance the quality of corporate governance.

To the extent of prevention of corporate failure, I argue that three ASX principles and recommendations could halt the demise of Dick Smith. Firstly, the 2nd principle which is “Structure the board to add value” by structuring the board with a majority of independent directors would prevent CEO dominance because some suggest that independent outside directors can reduce the influence of dominant individuals (ASX, 2014, p. 17). In accordance with Gallagher and Bennie (2015, p. 20), the independent directors are likely to focus on the company’s objectives and not to make decision relying on others. Furthermore, an addressing of independent directors would reduce the reliance on management, and create the effectiveness on monitoring (Dechow et al. 1996 cited in Christensen, Kent, and Stewart (2010)), as well as capability to lessen the conflict of interest between managers and shareholders (Hardjo & Alireza, 2012, p. 4). Thus, DSE’s board would be more active to monitor the CEO’s performances because independent directors pay attentions to the interest of company (Gallagher & Bennie, 2015, p. 20) and shareholders (Hardjo & Alireza, 2012, p. 4)

The article is written to help readers gain a solid understanding the roles of corporate governance, both inside and outside the company. Its goal is simply to impart information, not make claims or arguments on its own. I will be judging it mainly on the sources gathered, numerous examples and explanations given and the overall effectiveness it possesses in effectively communicating its ideas.

Armstrong and Dennis R. Balch in the Journal of Legal, Ethical and Regulatory Issues, Volume 18, Number 2, 2015 they interview two former Chief Financial Officers, Aaron Beam and Weston Smith to conduct qualitative assessment using the Banality of Wrongdoing Model. During the assessment Mr. Beam and Mr. Smith were asked fourteen questions to gauge “the culture of competition, ends-biased leadership, missionary zeal, legitimizing myth, the corporate cocoon, banality of wrongdoing and greed.” The authors of this study concluded that Mr. Beam and Mr. Smith did not attempt to justify or rationalize their behaviors or their part in unethical practices and accounting fraud but rather admitted to being fully aware of their actions and knew the ramifications of doing such. Rather than trying to justify their behaviors it became more of anxiety and stress to both of them, however they “used the defense that they were more or less forced into the behavior by the Chief Executive Officer, Richard

Our CEO Indra Nooyi implemented the “Performance with Purpose” guideline to help the company and employees make the right decisions. The company has also developed a Code of Conduct that addresses various business ethics issues such as bribery and conflicts of interest. PepsiCo expects the associates to be familiar with the Code of Conduct. The company also created a Chief Compliance Officer position to enforce the Code. In order to maintain our commitment to the communities and assorted stakeholders, the company has high standards for quality. By adhering to processes and ensuring proper governance, PepsiCo attempts to uphold its responsibilities and earn the confidence of stakeholders. To measure its progress and to make certain that it remains focused, PepsiCo has also developed the following six guiding principles that it uses to sustain its commitment. However, my example shows that we face ethical issues or questions even at a company that is established on how to handle unethical behaviors. It is largely at the individual level to act ethically. As we observed in the baby lab video, we are born with the universal moral core as well as the dark side of morality. As we grow older, society trained us to behavior ethically. However, when under pressure, we do regress to our younger selves. When we are faced with pressure and complications, decision making also become extremely difficult. Saying what is the right thing to do is easier than doing the right thing when you are in the situation. In the future, I will weigh in all four methods of ethical reasoning (virtue, interest, rights and duties) during the decision-making process. I believe that having the proper tools and help will guide me in making the right

This was a very interesting article, in my opinion it brings to mind the derived phrase, which came first the chicken or the egg. Meaning, is corporate governance an attempt to control the results of unethical practices of corporations or is it meant to deter them. In reading this article, it is clear that certain corporations practiced unethical business behaviors for self-interest, but the questions this author have are: 1. Should corporate governance be regulated by the legislature as well as the organization and to what degree, 2. Is corporate governance, there to protect the shareholder or the stakeholder, 3. How effective is corporate governance on a global level. The need for a governance system is based on the assumption that the separation between the owners of a company and its management provides self-interest executives the opportunity to take actions that benefit themselves, with the cost of these actions borne by the owners (Larcker & Tayan, 2008).

Genentech Roche 28 Corporate Governance in Three Economies: Germany, Japan, and the United States C441 10,12 1,3,11 N/A N/A 29 United Technologies Corporation: Running a Global Ethics and Compliance Program C447 11,12

It is only during moral lapses and corporate scandals that interest groups and the broader public ask themselves the fundamental ethical questions, who are the managers of the organization and were they acting with the ethical guidelines. For a long time, the issue of ethics was largely ignored, with organizations focusing on profit maximization. However, this has changed, and much attention is now focused on ethics management by researchers and leaders. The issue of ethics has arisen at a time when public trust on corporate governance is low, and the legitimacy of leadership is being questioned. Leaders are expected to be the source of moral development and ethical guidance to their employees.

The purpose of this paper is to highlight the role of external auditing in promoting good corporate governance. The role of auditors has been emphasized after the pass of the Sarbanes-Oxley Act as a response to the accounting scandal of Enron. Even though auditors are hired and paid by the company, their role is not to represent or act in favor of the company, but to watch and investigate the company’s financials to protect the public from any material misstatements that can affect their decisions. As part of this role, the auditors assess the level of the company’s adherence to its own code of ethics.

FI’s with large shareholdings are better apt at influencing the performance of investee firms in their portfolios by being a quasi insider and creating knowledge advantage using private information gained through regular meetings (Holland, 1999). Through cooperative means FI’s are able to probe, monitor and direct the corporate strategies, management and financial performance without direct intervention. Private and informal influencing is favored to public interventions as it may affect reputation of all parties involved.