Tutorial 6 week 8
The first principle is laying solid foundations for management and oversight. Companies should establish and disclose the respective roles and responsibilities of board and management. The recommendation provided is that Companies should establish the functions reserved to the board and those delegated to senior executives and disclose those functions. Moreover, companies should disclose the process for evaluating the performance of senior executives. Companies should also provide the information indicated in the Guide to reporting on the Principle. Secondly, the principle would be structuring the board to add value. Companies should have a board of an effective composition, size and commitment to adequately discharge its responsibilities and duties. Therefore, company is recommended that a majority of the board should be independent directors. The chair should be an independent director, while the roles of chair and chief executive officer should not be exercised by the same individual. Furthermore, promoting ethical and responsible decision-making is another key principle. For example, companies should actively promote ethical and responsible decision-making. Companies should establish a code of conduct and disclose the code or a summary of the code. Besides, companies should establish a policy concerning diversity and disclose the policy or a summary of that policy. The policy should include requirements for the board to establish measurable objectives for achieving gender diversity for the board to assess annually both the objectives and progress in achieving them. In conclusion, the council derived from the framework is comprised of representatives nominated by the 21 member organizations. The Council acts as an advisory council to ASX on corporate governance matters. ASX is the convener of the Council, nominates its chair, and provides executive and financial support. (b)
Commonwealth Bank of Australia Limited is chosen.
In general, CBA has complied quite well with the Corporate Governance Principles and Recommendations. CBA has clearly declared the delegation of authority, its constitution and policies, while it also stated its remuneration and audit arrangements along with the risk management.
According to CBA’s annual report, there are scarcely any departures from the Corporate Governance Principles and Recommendations as almost all the principles have been complied with. For instance, CBA has promoted ethical and responsible decision-making in the annual report, which is made timely and evenly. They also recognize and manage the risk to respect the rights of their shareholders. Furthermore, there shows fair and responsible remuneration in its annual report, which also proves CBA recognized the legitimate interests of shareholders. (iii)
The Corporate Governance Principles and Recommendations framework has been a guideline to the listed companies. It provides the standard principles and recommendations to the companies so the stock market would be more normative and become easier to manage. Although there might be some shortcoming like inflexibility and boundedness, it provides good guideline for standard corporate governance.
Tutorial 7 Week 9
Advise the board of La Bella Vita of any breaches of directors’ duties that may arise on these facts. First of all, we need to identify who owes the corporations act duties in this case. Under s180 and s181, the directors and officers of the corporation owe the duties to corporation (Asic v Adler 2012). In this case, Anastasia, as the managing director of the company, should be responsible for the duties she owes to the corporation. Therefore, now the core issue would be whether Anastasia has breached any of directors’ duties in this case. According to general law fiduciary duty, a director must act ‘bona fide’ in the best interests of company (Greenhalgh v Arderne Cinemas). Moreover, under s180 (1) (a), directors and...
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