Issues in Corporate Governance

CH AP TER 1 I S S U ES I N COR POR ATE G OVER N AN CE ADVANCED FINANCIAL MANAGEMENT Investment decisions Financing decisions Dividend decisions pecuniary objectives Primary objective maximise shargonholder wealth Secondary objectives get together other predetermined targets Stakeholders Shareholders Management and employees Customers Suppliers Lenders Government w w w . s tu d yi n te ra cti ve . o rg 1 CH AP TER 1 I S S U ES I N COR POR ATE G OVER N AN CE Stakeholders Suppliers Measures hurt Payment Security Liquidity Taxable profit Inflation engagement Investment Lenders Government w w w . tu d yi n te ra cti ve . o rg 2 CH AP TER 1 I S S U ES I N COR POR ATE G OVER N AN CE w w w . s tu d yi n te ra cti ve . o rg 3 CH AP TER 1 I S S U ES I N COR POR ATE G OVER N AN CE Corporate regime argon the bill effective? Are they making good decisions? depose we obtain assurance that they are? Are the board effective? combine Code Board of Directors Chair CEO Execs Non- execs w w w . s tu d yi n te ra cti ve . o rg 4 CH AP TER 1 I S S U ES I N COR POR ATE G OVER N AN CE Are they making good decisions? Higgs Report Cadbury Report Greenbury Code Key focus Smith Turnbull Can we obtain assurance that they are?Disclosure FSA listing Rules FSA Disclosure and Transparency rules Combined Code w w w . s tu d yi n te ra cti ve . o rg 5 CH AP TER 1 I S S U ES I N COR POR ATE G OVER N AN CE more than formalised Independent audit committee Quarterly reporting the States Sarbanes Oxley Independent directors PCOAB Critical accounting policies Germany EU company law Two-tier board of directors Board of directors Supervisory board Management board w w w . s tu d yi n te ra cti ve . o rg 6 CH AP TER 1 I S S U ES I N COR POR ATE G OVER N AN CE Japan Consensual management Policy boards Functional boards Monocratic boards w w . s tu d yi n te ra cti ve . o rg 7 CH AP TER 1 I S S U ES I N COR POR ATE G OVER N AN CE SUSTAINABILITY AND environmental RISK Sustainab ility balancing growth with environmental and social concerns At BP, we are working hard to restore trust in our ability to function safely and responsibly wherever we do business. Our approach to sustainability covers issues relating to governance and guess management, safety, the environment, the energy future and our local and global socio-economic impact. We aim to report on these issues in a way that answers key questions raised by our stakeholders. deoxycytidine monophosphate Trading 1. Governments hand out free tradable rights to mouth carbon dioxide to risky industrial polluters 2. Companies buy additional pollution credits from projects that claim to emit less greenhouse gas than they would have without the investment Environment deputation 1. Protects air, land and water used by society in England and Wales 2. Offers focal point to businesses on environmental issues Environmental Permitting Flood Pollution and emissions Waste piss Environmental Audits Ener gy saving Waste reduction Business processes w w w . s tu d yi n te ra cti ve . o rg 8