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Yes VW would potentially be a good choice but remember that you would mainly have to use the German CG Kodex rather than the UK Code. Also the German board model is not the same as the UK and American one. So you will need to research these.
However there is a lot of scope when it comes to stakeholders as you could extend this to cover the local community and develop the part on customers and suppliers as a consequence of the scandal. Whilst the scandal will form an important part of your RAP the markers will want to see that you haven’t ignored other factors and mostly just focused on that.
Thanks @Trephena I have just downloaded the German CG Kodex, will also research on the German board model. Thanks again.
Hello Trephena,
Thank you for your advice on the forum so far.
I am from Nigeria and the company I intend to assess is Zenith Bank Plc. Nigeria currently do not have a single CG code, though the National CG Code (NCCG) which will serve that purpose is still in the pipeline. The challenge am having now is the CG code to use. There is;
• Code of CG for Banks and Discount Houses in Nigeria issued by Central Bank of Nigeria.
• CG Code for Nigerian Public Companies issued by Nigerian Securities and Exchange Commission.Zenith bank has it shares listed in the Nigerian Stock Exchange (NSE) as well as in London Stock Exchange (LSE) of which UK CG Code is coming to my mind as well.
Please which code would be appropriate for me to use?Thank you.
@mrprincewill -as I have mentioned before on this forum, T17 is about quality of CG and best practice. That being the case there is no definitive answer especially as the code for banks will cover some factors not in the common CG codes for all listed companies (and v.v.). I would suggest that you look at the main provisions of each of the codes and select the most stringent requirements from each and see how the bank measures up (and do the same for another bank as a benchmark).
Thank you @Trephena.
@trephena
Thanks a ton for that entry, it has given me a lot of direction!
I wanted to ask whether it is alright to choose a company that is not currently making the headlines for any scandals but has had a rocky past. Also, does the scandal have to have been about accounting by any chance? I was looking at Valent Pharmaceuticals and the method in which it grew as I am interested in choosing this company to write my RAP on..
Do you have any advice regarding the above?Thank you 🙂
@elizateresa – the important thing is to choose a company for which there are some independent articles so that you are not overly relying on company generated sources and also a company that interests you.
I did a quick bit of research into Valaent and it sounds like there is a lot of material to work with. However don’t get too carried away with its misdemeanours (tempting though it may be) -you are supposed to stay ‘independent’, present facts from reliable sources and use them to form your opinion. It may well be that it followed the letter of the law when it comes to any CG Code. The evidence is interesting: were the sharp practices part of its strategy to fulfil its duty to shareholders by maximising their wealth? The fact that this may have been done at the expense of other stakeholders presents a paradoxical challenge to the objectives of CG especially as this seems to have been accompanied by other factors that have contributed to the stock price falling dramatically.
Yes an interesting case that gives you plenty of scope to bring in lots of critical thought and a good discussion of the purpose of CG and the ability to look at it from different viewpoints – as well as examining its performance against a CG code of course!
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hi trephena,
i have chosen m&s for topic 17. i haven’t yet come across any controversial scandal that i can raise concerns about? have i chosen a wrong company?
for the 2nd part of the topic, the shareholders, m&s has many stakeholders, so what direction do i take this part in?
I have selected this topic in relation to government institutions. Is this Title fine;
-THE QUALITY OF THE CORPORATE GOVERNANCE IN THE ROAD SECTOR AND ITS IMPACT ON THE KEY STAKEHOLDERS-
May i be helped to identify the key stakeholders and if the heading is fine please?
@Chanda – Normally you have to have a specific organisation because you have to evaluate the CG in it. However you may still be able to do this but you need very clear objectives and also sufficient independent sources to allow you to evaluate it properly so that it is balanced. CG does extend to government or to the not-for-profit section but you still need to be able to measure it all objectively.
As you give few details I don’t know what you have in mind or which country you are talking about. However it has certainly been true that major construction projects have been undertaken in some countries that have directly benefited the ruling elite and their families e.g. roads constructed to gain easy access to their luxury homes, or contracts awarded for the work to companies connected to government ministers or diversion of overseas development or UN aid intended to benefit the whole country to such projects or inflation of the cost of such projects with the government/ ruler taking a ‘kickback’.
What your project cannot be is just an essay on such corruption, it has to be balanced and be related to the governance of the organisations undertaking the work. It also needs to have a definite structure which includes some clear analysis i.e. original input from you. It must not be just statements of what you have found from your research – you have to do something with it.
Stakeholders would be anyone directly affected by the road sector e.g.potential road users, employees in the projects, those funding it (tax-payers or government agencies or overseas governments involved in it) and possibly the community affected by its construction (will it bring in more tourism/trade or interfere with the quality of their life – noise, pollution etc?)
I would probably advise you to set out your objectives and structure and as much preliminary detail as possible and email the OBU office to ask if this would fulfil their requirements particularly if there is not one (or possibly more than 2 organisations involved in this sector) as it could fall foul of their requirements. They would probably then refer it to a moderator for their considered opinion on whether your proposal is likely (given adequate evaluation and analysis etc) likely to be capable of achieving the assessment criteria requirements.
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@ayeshah said:
hi trephena,i have chosen m&s for topic 17. i haven’t yet come across any controversial scandals or issues that i can raise concerns about? have i chosen a wrong company?
for the 2nd part of the topic, the shareholders, m&s has many stakeholders, so what direction do i take this part in?
Hi @trephena
Kindly reply to my query as well. waiting anxiously!
@ayeshah -it is not necessary to choose a company experiencing a scandal. Both alfred and eminathsana got a B by using M &S which was scandal free.
@trephena Just wanted to let u know I passed with ‘A’ upper second class. So happy. The forum and you helped alot. Thank you so much
Eena. Period 31 topic 17 on Tesco
@Eena – many, many congratulations. So glad we were able to help you achieve this it is excellent news. Well done! 😀
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Stock buy-backs – the latest ‘fiddle’ used by top management to manipulate EPS so that executives make short-term gains and manage earnings. This stifles long term investment in a company and its long-term growth at the expense of other shareholders and is bad for a company’s economy as a whole. This is a direct example of the support for agency theory and questions stewardship theory (that left to their own devices management will work to benefit all shareholders!)
https://hbr.org/2014/09/profits-without-prosperity
Apparently 40% of FTSE 350 companies have engaged in some form of buy-back in the last 3 years (although not all may have been for nefarious purposes that benefit top management). I am sure that we will start to hear more about this topic and its detrimental effects on other stakeholders so watch this space.
You could also scour your company’s financial statements and notes to the accounts and research to see if they have have engaged in this and discuss it further in your report (as it is generally a sign of weaknesses in CG and an over-powerful CEO and loss of real independence of the board).
hie trephena i am in zimbabwe and m doin it topic 17 now my question is how many business models do i use to assess the quality of C.G of my organisation.
I wld lyc also lyc to ask the format of my part 3,
@paidah – your queries have been dealt with elsewhere on this forum so please spend some time in reading through – if necessary from the very beginning. I went through appropriate models on p.11 and it was also mentioned on p.12 and I talked alfred in the first few pages of our forum through how to approach the whole of a RAP on T17. I am currently extremely busy on a work project and do not have the time to go over everything again when it is already available – remember a degree is about researching and from the sources available working some things out for yourself 🙂
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Hello, trephena. Thank you for creating/maintaining this forum! It is very helpful and useful. I have just decided to do the RAP for Topic 17, but in a big doubt whether I should do it for May. I read almost every page for this topic. I know you were advising to allow on average 3 months to write a good RAP. I haven’t decided yet for which companies I should it. One idea is to do it for FTSE 100 companies. My mentor has just qualified as a mentor, so I cannot expect that much advice from him.
@maxatd -it depends how much free time you have. I advise 3 months to incorporate a couple of reviews (ideally one final one after a complete break of about 10 days away from looking at the RAP to allow for an objective thorough review) with the overall aim of achieving at least a B. Clearly you do not have this time as the submission window closes in about 6 weeks. If you would be happy with a C then this is probably still possible with a concerted effort.
Choose one main company and select appropriate comparator(s). They do not have to be FTSE 100. Neither alfred nor eminathsana had had experienced mentors.
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@trephena Thank you. I will keep going with RAP.
Hi dear @trephena and everybody.
I am doing T17 for my RAP. Company M&S.
As I go further with my writing, I am having many questions. Unfortunately my selected mentor is in Singapore (Learning Luminarium) and it takes 3-4 days to answer a question.
I need someones advice on Part 3:
1) I want to cover all the sections of the codes A-E, should I cover all the code provisions, Ex.:A.1.1-A.1.3 and then go to A.2?
2)Any suggestions how to put codes to the RAP?
As I have put it as:
A1:Every company…….
Then I put the external source to prove that M&S complies or not
Then I say that it complies or not, explaining the reason.
My mentor told me that in such a way she doesn’t see the code. I am very confused now.
3) If I cannot find any external source to the code A4 to back up the facts, can I just put the relevant data from M&S annual report and put complies or not?Thank you
KateRemember @kate1974 – someone has to read your work, not only that but probably another 100 reports as well . You mission is to keep them interested and not kill them with boredom 🙁 .
Your mentor is right – don’t approach it like this otherwise it will become VERY tedious (and when a marker is bored it is the ‘Kiss of Death’ and they will put a swift end to their misery). What you should aim to do is single out the areas where M & S hasn’t complied e.g. they used to (and possibly still do) combine the roles of Chairman and CEO. This gives you scope both to discuss the implication of this as it generally is a huge negative in terms of good CG (egocentric, meglomaniac CEOs who have not been held in check by a chairman – either because there was no independent chairman at all or they were ‘yes-men’ have been the ruin of many a good company and both RBS and HBOS immediately spring to mind!) but it also affords you the opportunity to bring in critical thought – essential for a pass grade. You then reference the sources that you are using to present your arguments. Board diversity, composition of committees are worth looking at in more focus and possibly relationships with shareholders – especially institutional shareholders (this is a bit ‘flavour of the month’ at the moment in CG with some very lively company AGMs -notably BP and HSBC just last week with vociferous shareholders). Mention routine stuff very briefly but save your words for current issues.
You MUST critique, evaluate, discuss and most importantly emphasise the really significant issues. Where you can, use graphs, pie charts etc to introduce a bit of relief from the text especially as graphical presentation provides a bit of interest. If your report is full of routine comments that do not consider the implications of the information and is excessively full of tedious text you will be setting yourself up for a fail (sorry but better I tell you now how it is and know this before you submit rather than in September)
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