Positive And Negative Aspects Of A Corporate Governance Essay

Positive And Negative Aspects Of A Corporate Governance Essay

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The main goal of this report is to evaluate the positive and the negative aspects of a corporate governance of two food-retailing companies, which operate in the UK. We are looking to see if in a large publicly owned company corporate governance mechanisms and corporate social responsibility practices are more evident in better performing companies. This report also includes the evaluation of the corporate governance structure of the two companies as well as any issues regarding the board of the organisation.

The corporate governance development has been driven by the hope to restore the investors confidence in the world’s stock markets again which has been damaged by financial scandals and corporate collapses. The development of big multi-national companies in the 1970s caused emphasis on the corporate governance to develop and improve.
The Definition of Corporate Governance

'Corporate Governance is the policies, procedures and rules governing the relationships between the shareholders, (stakeholders), directors and management of a company, as defined by the applicable laws, the corporate charter, the company 's bylaws, and formal policies '. ZAWAIDEH, M. (2003).

The distinctive feature of a large publicly owned company is the separation of ownership and control whereby the shareholders delegate the day-to-day management of the company to professional managers. Corporate governance ensures the company is run in the interest of the shareholders.

Sir Adrian Cadbury (1999) “Corporate governance is concerned with holding the balance between economic and social goals and between individual and communal goals…. the aim is to align as nearly as possible the interests of individuals, corporations, and society”.


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... industry, and is also one of the largest food retailers in the world. As of 22 April 2015 its market capitalization is approximately £18.1 billion.
Performance Related Publications

Tesco uses a method called “The Steering Wheel” to measure the performance and manage there business in a balanced way. There is 5 sections to this wheel, first one is customers evaluating that the customer is getting what they need and expect. Second is about People this is all about how staff feels about working at Tesco. Third section is Finance this looks into the costs and delivery of an effective operation and the stakeholder’s expectations. Fourth one is Operations which is all about the working environment productivity, and the final one Community which is a measure of how much the role of the business plays in the society and what the company does as a member of the community.

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