Critical Evaluation of Corporate Governance

Critical Evaluation of Corporate Governance

Introduction

A system through which companies are governed and controlled in accordance with the rules and defined principles is termed as 'Corporate Governance'. The system of corporate governance becomes famous after the corporate failures in US and UK, therefore it is the need of the hour to develop and implement a system which regulates the company affairs and govern their action with a view to safeguard the investors interest. In this manner a code of conduct is developed on Governmental level to secure the interests of investors and other stakeholders.

Background

Corporate governance is then linked with the company performance and the interests of the management. Most of the market analysts and professionals termed it as a system of deregulating conflicts between the management and the stakeholders. Following the background, corporate governance regulations are highlighted and regulated after the corporate failures of business giants like Enron and WorldCom. These companies are regarded as one of the top most in their business domains but they show voluntary defaults and the all the investor's money got drowned. The irony of the fate is that Enron was being awarded as the best company just a few days back they declare default.

Objective of the Report

The main objective of this report is to analyze and identify the concept of Corporate Governance and how the company Right Move PLC had an impact on its performance.

What are some of the reasons that a company would maintain the rules and implement it in the same manner as written and prescribed by the code of conduct?

Critical Evaluation of Corporate Governance of a Right Move PLC

The company Right Move Plc implements the concept of Corporate Governance in such a manner that it posts a circular for their stakeholders that the company is going for a corporate restructuring. Being a UK company it is mandatory for them to implement and comply the rules and regulations of (UKCGC) which is United Kingdom Corporate Governance Code.

The company has top follow all the financial complaisance as well as, the documentation needs to be complete in accordance with the audit committee. The auditors are separated from the company as they are not legally the part of the company except the internal ones. The tax and audit requirement needs to be fulfilled. All the decisions even if strategic level which is conrened to any acquisitions needs to be discussed with the stakeholders of the company as they i9nvest a large stake of their money in the company. The financial statements and the annuals records of the company should be published on annual basis so that the stakeholders are aware of the performance of the company and where it is going. At the beginning of the process of economic transition in Eastern Europe seemed to be a unique view of what the former economy needs to do to become a successful market economy.

The operations of the board also comes under it the approval of new ...