Executive Summary : Martha Stewart

Better Essays
Executive Summary In the early 1990’s, Martha Stewart was gaining popularity and it appeared that she would continue to have great success with her many talents and her company, MSO. Unfortunately for Stewart, there were some underlying issues that would eventually cause major problems for her and her company. Many of these problems sprouted from a lack of corporate governance, and it could be said that some of these issues could have been avoided if there had been better corporate governance policies in place. One of the biggest problems MSO faced was Stewart’s involvement in the company. Much of the success of her company relied on her image. She was very popular and many women looked up to her, but MSO was too reliant upon the…show more content…
For starters, by recognizing that good governance is not purely based on compliance, the Board of Management would have noted the insider training program being conducted by the CEO. Restructuring the policies continually based on the company’s performance would have fostered greater accountability, transparency, and team-work among the employees (Beauchamp 104).
8.What other steps could have been taken to improve governance?
Other steps the board should have taken in order to improve overall corporate control include the recognition that the governance of risk is the Board’s responsibility, and not that of the CEO. This initiative would have enhanced collective responsibility for the company thereby avoiding exploitations of the company’s information for personal benefit. Moreover, the board of management ought to have acknowledged that they had a right to elect a new CEO. Owing to the fact that the board can employ their desired executive based on merit, getting rid of the incompetent head would have enhanced the long-term performance of the company.
9.How might the board have provided better strategic direction for the company? The board would have provided proper managerial direction for the company by defining its strategies, vision and tactics. By envisioning the company’s future appropriately through the prioritization of the
Get Access