LVMH: Corporate Structure and Business Plan

By 2002, Moet Hennessy Louis Vuitton was the world's largest luxury products company, enjoying annual sales of 12.2 billion euros. LVMH carries the most prestigious brand names in wine, champagne, fashion, jewelry, and perfume. Upon entrance of this luxury product industry, LVMH was aware that they produced products that nobody needed, but that were desired by millions across the world. This desire in some way fulfills a fantasy, making consumers feel as though they must buy it, or else they will not be in the moment, and thus will be left behind.

This board of directors shares the governing influences upon the MCO as a whole. As Kongstvedt reveals, “the final approval of corporate bylaws rests with the board. It is the bylaws that determine the basic structure of power, both that of the plan officers and that of the board itself. Because significant liability issues around the Board of Directors each board member must undertake his or her duties with care and diligence” (Kongstvedt, 2009). This governing board of an MCO is imperative, as the capital that is often times required is controlled by this specific governing body. Furthermore, the governing board also has the obligation to release the necessary financial statements to stockholder (Kongstvedt,

Hanesbrands Inc. implemented strategy to have Richard A. Noll to hold the Chairman and CEO position. Considering that the Board of Director acts as an advisor and counselor to the CEO and senior management and oversees their activities and performance, this policy has a disadvantage for the company because it can lead to conflict interests. It is still a weakness of this policy, although this weakness is minimized by the rule that the non-management directors will undertake a formal evaluation of the CEO annually and the Compensation Committee along with other independent directors should be responsible for reviewing and approving the compensation program for the CEO (Hanesbrands Inc. Corporate Governance Guidelines, 2016).

No director or officer of this corporation nor any other corporation, firm, association, or other entity in which one or more of this corporation 's Directors or officers are Directors or officers or have a material financial interest, shall be interested, directly or indirectly, in any contract or transaction with this corporation, unless (a) the material facts regarding that director 's or officer 's financial interest in such contract or transaction or regarding such common Directorship, officership, or financial interest are fully disclosed in good faith and noted in the minutes, or are known to all members of the board prior to the board 's consideration of such contract or transaction; (b) such

The Board of Directors is defined as “a group of elected individuals who serve as representatives of an organizations’ stockholders” (Root). They are the decision-making power over management related policies and fiduciary duties of the organization. They make decisions to fire or hire the executive leaders, conduct performance evaluations on the company’s leading executives, and ultimately decide the executive’s compensation, as well as dividends to be distributed to the shareholders. The Board of Directors determine the organization’s strategic direction, and make sure the company is operating under the principles of the law to ensure the organization is conducting itself ethically, legally, and with social and environmental responsibility (Bateman 267).

Discuss these topics and make specific recommendations to Lakeside. Objective – Corporate governance and internal control in the public reporting context.

In accordance with business dictionary writes, "governing body (called the board) of an incorporated firm. Its members (directors) are elected normally by the subscribers (stockholders) of the firm (generally at an annual general meeting or AGM) to govern the firm and look after the subscribers ' interests". The responsibilities of the board of director firstly, defining the purposes and procedures, which are the part of the company 's strategy and compliance because the purpose encourages the company to reach the goals step-by-step. Secondly, the director should monitor the progress during an achievement of those purposes and procedures. Thirdly, senior management is also appointed, hired, monitored, evaluated and fired by the directors (the member of the board include senior called inside directors or executive directors. Fourthly, determining and paying the dividend. Lastly, responsible with the activities of the company that relevant many parties.

In fact, neither Rich nor Keeling paid attention to this control and coordination process. This negligence has led to poor corporate governance structure, causing problems failed to be detected by the board of directors. And instead, made the problems became worse. Pass (2004) explained corporate governance is concerned with the duties and responsibilities of a company’s board of directors in managing the company and their relationship with the shareholders of the company and other stakeholder group. While corporate governance plays a crucial role for company sustainability, Rich and Keeling were not involving the shareholders directly to the operation of the company in a timely basis. Needless to talk about the involvement of the shareholders, even Rich and Keeling as the founder were not irresponsible enough to manage planning for new product, forecasting staffing needs and training, advertising, and the availability of products. All those important processes were ignored and caused the frustration of the customers. This was directly impact to the call center staffs who were pressurized by the complaints and anger of customers. As a result, the turnover in call center increased to over 100% per year.

According to the judge, the non-executive directors depended on the management and the auditors decisions while stating the fact that the

As the CEO of Staples, Ronald Sargent believes that a democracy management style can urge the Executive Committee to act in the best interests of shareholders. In the annual report, we can see that most senior executives are responsible for collaborating with the Audit Committee to provide oversight to the risk management. Top management has a very close relationship with subordinate teams. Senior members of management make up an Enterprise Risk Committee to control the risk of the company. They have very close collaboration to share information and thoughts for all types of risks. Independent directors also regularly meet without management present to discuss the company 's strategy. A diversity management team is very important to Staples. Board of directors is consisted of the people who has different experience, skills, gender and ethnic backgrounds.

Requires a strong and independent audit committee which is to oversee the audit instead of management

The Board, in setting up its corporate administration standards, had respect to the ASX Corporate Governance Principles and Recommendations, and unless unveiled beneath the greater part of the Recommendations have been connected. The explanations behind any takeoff from these standards and Recommendations are clarified underneath. The Board aides and screens the business and issues of the Company for the benefit of the shareholders by whom they are chosen and to whom they are responsible.

Absolutely key in this endeavour are the leadership of the chairman of a board, the support given to and by the CEO, and the frankness and openness of mind with which issues are discussed and tackled by all directors. 4. The challenge should not be underrated. To run a corporate board successfully is extremely demanding. Constraints on time and knowledge combine with the need to maintain mutual respect and openness between a cast of strong, able and busy directors dealing with each other across the different demands of executive and non-executive roles. To achieve good governance requires continuing and high quality effort. 5. The Code’s function should be to help boards discharge their duties in the best interests of their companies. In recent reviews of the Code, the FRC has focussed on changing the “tone” of the Code by making limited but significant changes to signal the importance of the general principles which should guide board behaviours. It is to be hoped that these changes will promote greater clarity and understanding with regard to the tasks of a board and that communication with shareholders will be more effective as a result. 6. Chairmen are encouraged to report personally in their annual statements how the principles relating to the role and effectiveness of the board (in Sections A

Among the most dynamic and performing brands on the market, the Houses in the Watches & Jewelry sector of LVMH operate in two segments:

For the purpose of this report, corporate governance is defined as the relationship that exists between company management, stakeholders and the board. Objectives of the company are usually set, attained and monitored through the structure corporate governance provides. (Balgobin 2008).The Guyana Corporate Code of Governance is similar to the UK codes of corporate governance and the Organisation for Economic Co-operation and Development (OECD 2004).These principles serve as a reference point that can be used by companies to develop their own frameworks for corporate governance that reflect their own circumstances or situations.