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Corporate governance (context & development (Two main reason…

- - - - Transparency & reliability in reporting
      - Systems of structure, management, accountable for performances to the organisation goals
- - - - Leadership & strategic
      - Implement resources
      - corporate objectives
      - Responsible for performance
      - CEO accountable to the board
    - - Structured to link rewards individual performance
      - Principles are transparency
      - Committee, non-executive directors
      - Identifiable performance
      - Earnings per shares & share index
      - Interests of shareholders in long-term to agreed targets
      - Three components
        
        fixed annual salary
        
        Cash annual bonuses
        
        Executive share options
    - - Boards responsible strategic objectives
      - UK combined code
        
        financial & business reporting
        
        risk management & internal control
        
        accountability & audit
        
        Internal controls to safeguard shareholders
        
        Financial, operational, compliance, risk management
        
        Long side annual report should be committee's report
      - Company's position & prospects, interim reports & annual reports
      - Audit committee
        
        Monitor integrity of FS
        
        Review & assess ics
        
        Review & monitor audit process
        
        Make recommendations in general meetings
    - - Bridge the communication gap between management & shareholders
      - AGM, general meetings, extraordinary general meetings, special resolutions
      - Institutional investors = invest on behalf of members.
      - Stock exchange listing conditions = all companies comply with UK CC