This website uses cookies to ensure you have the best experience. Learn more

Corporate Governance Concepts Worksheet And Mc Bride

2144 words - 9 pages

PAGE 1 PAGE Corporate Governance Concepts PAGE 1
Corporate Governance Concepts WorksheetUniversity of PhoenixCorporate Governance Concepts Worksheet
Concept

Application of Concept in the Scenario

Reference to Concept in Reading

Shift in corporate power from the CEO to other stakeholders -
Board impact on corporate governance

Hugh states in an email "I want to give it its due attention but do not plan on allowing the money men to dictate how I'll run this company. Please proceed with invitations for those listed as my choice for directors." Beltway Investments believes that Hugh will use "sound corporate governance exercised by you and your team" (University of Phoenix, 2008).
Hugh does not see the advantages of having proper corporate governance at McBride Financial Services Inc. (MFSI). Hugh also does not see the benefit of independent directors without any close relations to Hugh in his email statement stating, "Since Beltway will need to approve these selections, I'll need a 'flowery' biography for each selling them on approval" (University of Phoenix, 2008).
A fully functioning independent board of directors will not keep Hugh around for long with his current attitude and work ethic.

"An active and independent board of directors working for shareholders clearly benefits the corporation by reducing the "agency problem" that arises from the separation of ownership from control in the modern corporation. It does so by acting as agent for owners in controlling a management whose principal motive is not to maximize value but rather to enhance its own position. Any resulting change in management's behavior, no matter how limited, should increase returns to the owners as residual claimants" (Chew & Gillan, 2005, p. 180).
"To serve as effective monitors, directors must be independent of the management they monitor. Directors who are members of management, or are otherwise closely linked to management, have the same interest as management in perpetuating corporate performance measured in terms of growth for its own sake"(Chew & Gillan, 2005, p. 180).

The roles of management in corporate governance - Tracking stock
- Setting stretch goals
- Bonus plans

Hugh states in an email
I have thought over our discussion re: incentive compensation and have decided to hold off on stock options altogether…at this time I am not interested in diluting my shares, nor is Larry. We will also hold-off on options for the new directors…same reason. Let us discuss this later…for now, let us just go with fair salaries (University of Phoenix, 2008).
Hugh does not see the value of incentive plans such as tracking stock, setting stretch goals, and bonus plans. For the company to realize growth, proper incentive plans need to be in place.

" The tracking stock also provides for investors a pure play opportunity in a focused business with managers, through stock options, being rewarded for the value they add to the business they...

Find Another Essay On Corporate Governance Concepts Worksheet and McBride

Development Comparison of Corporate Governance in Malaysia and Singapore

1410 words - 6 pages The Asian Financial Crisis which exposed the corporate governance weaknesses was a wake-up call for all the policymakers, standard setters as well as the companies (OECD, 2014). The parties that involved and affected from the crisis started to realize the importance of having strong corporate governance practices in their countries. Consequently, the Asian economies along with the OECD established the Asian Roundtable on Corporate Governance in

Corporate governance and firm performance in Pharmaceutical industry of Pakistan

3362 words - 13 pages AbstractThere has been much discussion recently about whether corporate governance makes a difference in improving company performanceThis study is initiated on "corporate governance and firm performance" with the samples of 8 pharmaceutical companies using the data from their annual reports, representing the periods of 2008 - 2012. Board committee, board meeting and board size including executive directors and non-executive directors were used

The relationship between corporate governance and earnings quality of Hong Kong listed company

1779 words - 7 pages Topic: The relationship between corporate governance and earnings quality of Hong Kong listed companyBackgroundCorporate governance means the relationship between the company's management, board of directors, shareholders and other persons associated with the business interests. Meanwhile, corporate governance also provides a system to allow bodies to set goals, develop strategies to achieve goals, and monitoring bodies' performance. That is

Corporate Governance and Management of Small Business Enterprise: An Executive Summary

1512 words - 6 pages Shea (2006), in quoting the work of Steiner & Steiner (2006) explained that corporate governance is generally referred to overall control of activities in a corporation that involves the formulation of corporate objectives, strategies, and plans and the proper management structure in order to be responsible to its various stakeholders. Since the 1990s, the term corporate governance has become a business jargon around the world. The

'To what extent has corporate governance reduced the separation of ownership and control?'

2837 words - 11 pages 'To what extent has corporate governance reduced the separation of ownership and control?'Corporate governance in its simplest form can be defined as 'having good management to run a company'. (Financial Institutions, Intangibles and Corporate Governance, John Holland, Accounting, Auditing and Accountability, Journal, Vol. 14, Number 4, 2001, p. 13). Unfortunately corporate governance is not that simple, and includes much more than just 'good

Corporate Governance Risk Hedging Derivative Instruments: An emphasis on Corporations and Hedge Funds

1317 words - 6 pages corporate governance mechanisms). In the hedge fund industry, where derivatives are mainly used for speculation, boards rarely meet. The limited partnership is the driving nature of the relationship between the fund manager and the investor. Regular shareholders meetings should be held on a yearly basis, at least four, to ensure to the investors that the risks taken and how they are measured are plausible, and that the manager knows what he is

Corporate Governance and Separating the Board Chairperson from the Chief Executive Officer

1853 words - 7 pages Corporate Governance and Separating the Board Chairperson from the Chief Executive Officer Numerous reports on corporate governance have emphasised the desirability of increasing the number of outside directors on boards. An equally important and related issue is a growing insistence that the role of chairman and chief executive should be separate, though on this issue there is less unanimity in the U.S. than in other countries. Choosing

Corporate Governance in annual reports. Includes Shell, Ahold, Philips and the new CG-rules in the Netherlands (Commission Tabaksblat)

4873 words - 19 pages Shareholders94.1.5 Preferred shares94.1.6 The Sarbanes-Oxley Act94.2 Ahold94.2.2 The Supervisory Board94.2.3 The Corporate Executive Board104.2.4 Shareholders104.2.5 Prefered shares104.2.6 Sarbanes-Oxley Act104.3 Philips114.3.2 The Supervisory Board114.3.3 The Board of Management114.3.4 General Meeting of Shareholders124.3.5 Preference shares and the Stichting Preferente Aandelen Philips121. What is corporate governance?Corporate governance is a generic term

A DISCUSSION ABOUT THE FAILURE OF FINANCIAL ENGINEERING AND CORPORATE GOVERNANCE AS A CAUSE OF THE GLOBAL FINANCIAL CRISIS

1494 words - 6 pages In this paper, an analysis of how the failures in financial engineering and Corporate Governance have been closely related with the recent Global Financial Crisis is carried out. The Real Estate Bubble in 2006 leaded to the Subprime Mortgage Crisis in 2007 which expanded from the United States to the whole world generating the biggest financial crisis since the Great Depression of the 1930s. There are multiple factors that originate a crisis

Corporate Governance and Social Responsibility

1337 words - 5 pages , they do something which is to fulfil the others' needs. This is called a "business". To do business, people can organise themselves in a group which is called corporate or organisation. In other words, a business can be defined as an organisation that strives for profits while meeting the needs of its customers and employees and balancing the impact of its actions to other stakeholders. The main aim of it is to make profit. On the other hand, they

Research Design and Statistics Concepts Worksheet

717 words - 3 pages ConceptApplication of Concept in ScenarioReference to Concept in ReadingDistinguish between secondary and primary researchJim Wilson used a focus group study to determine demand for the commercial product. Mary Monroe used a market research company to conduct a feasibility study based on survey results collected on the company web site. These are both types of primary research because the information was gathered directly from people by means of

Similar Essays

Corporate Governance And Corporate Social Responsibility

1970 words - 8 pages   Unit Assignment 1 CORPORATE GOVERNANCE 1.1 STRUCTURE, ROLES, OBJECTIVES Shareholders in this company are crucial as they are the success and core of this company. Keeping the shareholders of this company happy will result in tremendous outcomes. Shareholders will elect the Board of Directors which in turn, Board of Directors will hire the Chief Executive Officer. The CEO has the authority and responsibility of hiring and managing the

Report And Analysis Of Corporate Governance

2193 words - 9 pages Introduction The increased incidence of the economic crisis in affect to all the world economy, especially the leading developed country, United States and Britain in1980’s (Weir & Laing, 2001) and has become to importance of corporate governance and also in developing countries (Rasiah, 1999), The economic loss and damage of investment of investors are the result of inefficiency of corporate governance, which caused of lack of the inspection

Corporate Governance, Audit Committe, And Director Independence

1534 words - 7 pages Corporate Governance, Audit Committee & director independence A spate of shattering corporate collapses, particularly among large listed companies despite their annual reports and accounts have raised numerous issues in corporate governance. The corporate meteoric rise and fall was associated with serious deficiencies in its corporate governance, including weaknesses in internal control, financial reporting, audit quality, board’s scrutiny of

The Rules And Principles Of Corporate Governance

1048 words - 5 pages Corporate governance often refers to a set of rules and principles by which a company is directed. It provides a guideline for directing a company in order to fulfil its objective, brings added value to the enterprise, and is beneficial to the shareholders in long-term. (1) The rules and principals of corporate governance to an extent might be different in various companies, but some of these rules are similar in all the firms; such as