The Failure Of Dick Smith Electronics

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The Failure of Dick Smith Electronics How the latest edition (3rd) of the ASX Corporate Governance Principles plausibly halts the failure of Dick Smith Electronics (DSE) will be discussed in this essay. I argue that ASX Corporate Governance Principles are one of the corporate governance practices that many listed entities in Australia should comply with in order to achieve good corporate governance preventing the collapse of corporations and increasing investors’ confidence. Regarding DSE as a listed entity, it would survive and continuously operate as a biggest Australia electronic retailer if the better application of this practice is fully adopted. The first section of this essay focuses on the possible causes of corporate failures, including dominant CEO, poor strategic decision and the failure of internal control. Secondly, it discusses how the third edition of corporate governance principles and recommendations could be applied to prevent the causes of the failure. The 1st, 2nd, and 7th principles along with specific recommendations will be mentioned in this section. However, the context is concerned solely with the causes stemming from the performance of DSE itself. In 2012, DSE was purchased by Anchorage Capital Partners, and Nick Abboud was appointed as a chief executive officer (CEO) since then (Low, 2016a). In December 2013, it was floated into the Australian Stock Exchange for $520 million with roughly $370 million of profit (Mitchell, 2015). Six month

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