The Australian Stock Exchange’s (ASX) Corporate Governance Council (2014) defines corporate governance as “A framework of rules, relationships, systems and processes within and by which authority is exercised and controlled within corporations”. One goal of corporate governance is for the board members to increase shareholder value (Tricker 2015). In order to achieve this, it is important that the board act appropriately and justly so that the best interest of investors are protected. This report will explore the effectiveness of JB Hi-Fi’s corporate governance. JB Hi-Fi is Australia’s largest home entertainment retailer, selling a variety of products at discounted prices. Over the years, they have maintained a substantial market share with moderate profits.
This report will begin by exploring the company background of JB Hi-Fi. JB Hi-Fi’s current corporate governance practices will be explored using the ASX Corporate Governance eight principles and recommendations. These eight principles will be further analysed and supported using legislation, theories, concepts, company examples and case studies. By analysing JB Hi-Fi through all of the means discussed, this report will demonstrate areas of success and development. Furthermore, recommendations will be made to improve current corporate governance practices in order for JB Hi-Fi to further demonstrate leading ways in corporate governance practices.
2. Company Background
JB Hi-Fi began as a small hi-fi retailer in 1974, founder John Barbuto had one dream. It was to become the biggest electronic retailer in Australia, this eventually came to fruition but not while he owned it. JB Hi-Fi was sold in 1982 and again in 2000 to a private bank equity. The goal of Barbu...
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...details the behaviours that are expected in order for all directors, executives and employees to act ethically and responsibly, but also how employees should be treated as well.
Brenkert (2010) states that business ethics have been making significant gains in its development over the past decades and CSR is an integral part of all organisations. JB Hi-Fi discloses their CSR in every annual report. In their 2015 Annual Report, they listed a group of programs initiated by JB Hi-Fi to demonstrate their community connections. One such program was “Helping Hands” which is an employee initiated charity where employees make a weekly contribution and JB Hi Fi matches every dollar. Over 8 years, they have raised over $7,250,000 to a number of different charity partners (JB Hi-Fi 2015). JB Hi-Fi details their CSR in every report and is evident that are ethically responsible.
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