Corporate Governance Scandals - Free Essay Example

Sample details Pages: 30 Words: 9032 Downloads: 2 Date added: 2017/06/26 Category Statistics Essay Did you like this example? 1.1 Introduction The aim of this thesis is to examine the evolution of Corporate Governance in the United Kingdom and the affects which corporate scandals had on it. This aim is achieved through the following objectives: Don’t waste time! Our writers will create an original "Corporate Governance Scandals" essay for you Create order The development of Corporate Governance in the United Kingdom. The affect of corporate scandals on stakeholders. Corporate scandals and Corporate Governance. Corporate Governance has been a source of discussion among investors and entrepreneur and it has gone through many changes in recent years. It is defined as the structures and processes for the direction and control of companies (World Bank, 2005). The importance of Corporate Governance came into enlightenment after the collapse of high profile organisation such as Robert Maxwell (Parkinson Kelly, 1999). These corporate failings lead to UK Corporate governance being improved (Iskander Chamlou, 2000). The Dramatise change in Corporate Governance affected many big organisations with a number of challenges. But the key aspect of Corporate Governance is Risk-taking is fundamental to business activity (Spira Page, 2003), which means risk taken by the organisation must be controlled properly and from here Risk Management comes in. To select Corporate Governance as a dissertation topic large amount of research activities with many sources of literature is being used. One of the major problem realised with this topic was, there was ample amount of literature available and that to is very difficult to select the most appropriate one. But problem was solved by concentrating on academic literature, which is mentioned in brief in this dissertation. The structure of this dissertation is as follows, chapter one will focus on literature review, which will provide some basis knowledge for this dissertation. The main aim of the literature review is to highlight the various factors associated with the evolution of Corporate Governance. This section will also include Corporate Governance in the USA which will only give some idea how the legislation is different in two countries. Secondly we will discuss some scandals (Arthur Andersen and Robert Maxwell). The purpose of choosing these two case is to show by which Corporate Governance reached the stage of maturity. Robert Maxwell scandal which occurred in the UK and Arthur Andersen scandal occurred in the United States, which will be the second chapter of this dissertation which actually gave the birth to Corporate Governance. And the last part of the dissertation which is third and final chapter will describe some limitation and conclusion. Chapter 1 Literature Review The aim of this section is to provide an overview in order to analyse different aspect of Corporate Governance and scandals which are linked with the aim and objective of this dissertation. This part of the dissertation will describe about, what Corporate Governance actually is, discussing definitions. Further it will present back ground, development of Corporate Governance in UK, need for Corporate Governance and Corporate Scandals. What is Corporate Governance? Corporate governance is a field in economics that investigates how to secure/motivate efficient management of corporations by the use of incentive mechanisms, such as contracts, organizational designs and legislation. This is often limited to the question of improving financial performance, for example, how the corporate owners can secure/motivate that the corporate managers will deliver a competitive rate of return, www.encycogov.com, Mathiesen [2002]. Corporate governance deals with the ways in which suppliers of finance to corporations assure themselves of getting a return on their investment, The Journal of Finance, Shleifer and Vishny [1997, page 737]. Some commentators take too narrow a view, and say it (corporate governance) is the fancy term for the way in which directors and auditors handle their responsibilities towards shareholders. Others use the expression as if it were synonymous with shareholder democracy. Corporate governance is a topic recently conceived, as yet ill-defined, and consequently blurred at the edge. Corporate governance as a subject, as an objective, or as a regime to be followed for the good of shareholders, employees, customers, bankers and indeed for the reputation and standing of our nation and its economy Maw et al. [1994, page 1]. Corporate Governance is the structures and the process for the direction and control of companies (World Bank, 2005). This definition only explain the involvement of Corporate Governance, however it fails to explain in depth about Corporate Governance. The other definition says the system by which companies are directed and controlled (Cadbury, 1992, Coyle, p4). The Organisation for Economic Co-operation and Development (OECD, 1998) explain Corporate Governance in more details it says A set of relationships between a companys board, its shareholders and other stakeholders. It also provides the structure through which the objectives of the company are set, and the means of attaining those objectives and monitoring performance are determined (United Nations, 2003, p1). If we look at the definition provided by the OECD (1998) we can say Corporate Governance involve number of parties such as stake holder, share holder and board, and the goal of an organisation can be achieved by using Corporate Governance. And lastly we can say Corporate Governance measures the performance of the company. Background Many large organisations in UK suffered because of the Corporate Governance and this was the main reason for the number of changes in it throughout the years. One of the secondary reasons for this change was the economy and society as well. In this section we will focus on this area, the change occurred in this area and the impact of these changes on corporate world. Dubbed the Enron of England, the South Sea Bubble was one of historys worst financial bubbles (Stock Market Crash! 2006). This was started in 1711, when a war felt Britain in arrears by 10 million pounds. And this debt was financed by the South Sea Company at 6% interest. A part from the interest, Britain also gave the right to trade exclusively in the South Seas. The failure of the South Sea bubble was the expectation of the directors lying about the profits, as the South Sea Company issued stock to finance its operation. Interested Investors quickly realised that company is having monopoly in the market, so the share price increased drastically from the scratch. Speculation became rampant as the share price kept skyrocketing (Stock Market Crash! 2006). And after certain period the management realized that the company share was overvalued. Well we can say that this point in time this happened because there was none of the guidance documents which are available today. Cadbury Committee told this initiative and they produce the first guidance document in the UK, which was chaired by Adrian Cadbury (Cadbury, Report, 1992). The Cadbury Committee Report included a number of financial aspects of corporate governance i.e. the role of the board, auditing and reporting of financial information to shareholders (Cadbury Report, 1992). Cadbury Committee Report was structured in such a manner that the organisations can easily follow it. Here are some outlines of Cadbury Committee Report, Section 4 deals with the structure of board, and there should be executive directors and independent non-executive directors. Section 4.11 explains the purpose of having non-executive directors. The responsibilities of directors which are mentioned in section 4.28. Internal control is discussed in section 4.31 of the Cadbury Report (1992) which provided guidance on keeping records of accounts and reducing the chance of fraud (Cadbury, 1992). Section 4.33 which explain about Audit committee and there relationship with the board members and the appointment of external auditors. However Cadbury Committee report fails to unveil directors remuneration, which leads to the introduction of the Greenbury Report. The chartered Institute of Management Accountants (1999) explains the purposes of having Greenbury Report, to encourage more transparency with the organisation. It provides guidance on directors salaries, bonuses, and also accountability (Chambers 2002). Section A of the Greenbury Report discusses about the directors remuneration and directors remuneration should be decided by a remuneration committee. This committee should include non-executive directors who will decide upon the remuneration of the directors (Greenbury, 1995, section A1). The remuneration committee should provide report to shareholders which are discuss in Section B of the Greenbury Report disclosure and approval provisions (Greenbury, 1995, section B). Section C of the Greenbury Report discuss the performance of the company with there directors. The performance- related component of remuneration should be plan to align the interest of Directors and shareholders and to give directors enthusiastic incentives to execute at the highest levels (Greenbury, 1995, section C). Section D of the Greenbury Report discusses service contracts and compensation (Greenbury Report, 1995, Section D). This part focus on, how much compensation a director is entitled in the event of lea ving the company before his/ her contract expires. This means that shareholders know accurately how much it would cost them if they are firing any one of there director or directors. Hampel and the Broadening of Control Hampels Committee on Corporate Governance (1998) resulted in both a step fore and a step back from the earlier Cadbury report. Hampel elaborated the concept of internal control business risk assessment and response, financial management, compliance with laws and regulations and the safeguarding of assets, including the minimising of fraud (Hampel, 1998, pp. 53-54). The authors clearly stated that They are not concerned only with the financial aspects of governance (Hampel, 1998, p.53). Hampel took a broad view of internal control, stating that it is the responsibility of directors to establish a robust system of risk management, to recognize and appraise potential risks in every aspect of the business operation. The control concept of Hampels was welcome by many organisations, which also include the Association of British Insurers (ABI) which recognise it a realistic approach that motivated companies to deal with their compliance with the new corporate governance requirements (Fagan, 1999). Neil Cowan, Vice President of the European Confederation of Institutes of Internal Auditing, say that Hampels view of risk management represented a welcome restatement of that part of a Boards prime responsibility for devising a strategy that will ensure the companys continued existence (Cowan, 1997). The Turnbull Report A committee chaired by Nigel Turnbull produce a new report titled, Internal Control: Guidelines for Directors on the Combined Code, under the support of Institute of Chartered Accountants in England and Wales (ICAEW, 1999), it was published less than two years after the Hampel Committee on Corporate Governance was published. The document issued by Turnbull committee filled may gaps left by Cadbury and Hampel. The report was drafting by the recommendations of the Combined Code and the underlying Hampel recommendations that directors review all controls. The main aim of the report as agreed by large organisation including ICAEW and the London Stock Exchange was to provide guidance to the listed companies and to implement the requirements in the Code relating to internal control. But the main purpose of the report was giving the relaxation to companies to explain their governance policies, the guidance obliged the board to report on the effectiveness of the companys system of internal c ontrol. This centre on internal control is attached to the idea of a dynamic company, which requires non-stop monitoring and auditing. The Report states that: A companys objectives, its internal organisation and the environment in which it operates are frequently developing and, consequence, the risks it faces are frequently altering. So there should a sound internal control system which depends on a regular assessment of the nature and extent of the risks to which the company is exposed. As profits are, in part, the prizes for successful risk-taking in business. Internal Control purpose is to help manager and control risk appropriately rather than to eliminate it. (ICAEW, 1999, p.5, para.13). Turnbull Committee involve two steps to interpret, firstly to identify the risk and how the risk is managed and evaluated. Secondly, assess the effectiveness of the internal control system, it procedure and effectiveness. Some other report which focuses on Corporate Governance in UK are Rutteman Report 1994 on Internal Control and Financial Reporting, Myners Report 2001 on Relationship between institutional investors and companies, Tyson Report 2003 on Recruitment and development of non executive directors (Chartered Institute of accountants for England and Wales, 2006). Why use Corporate Governance? The argument that the company should be subject to legal regulation at least some of their actions tends to be couched in term of Market failure. Companies are recognized to have characteristics, particularly the scale and scope of their operations, which make the market governance of their actions imperfect. The purpose of the regulation is to iron out those imperfections and to restore market governance. Now in some cases this may mean very extensive legal regulation indeed, and in exceptional cases, particularly in respect of the so-called natural monopolies, an acceptance that market governance must be abandoned in favour of economy governance. This is a topic, which is growing in importance following a number of high profile failures. In UK stock market as per Financial Aspects of Corporate Governance,1992 all listed companies need to publicly state whether or not they comply with Corporate Governance. If the Investors they are not fulfilling this requirement, they may full loss as this is an incentive for the listed companies to use Corporate Governance otherwise investors may choose to invest elsewhere. According to James Madison (Bavly, 1999) No man is allowed to be judge in his own case, because his interest would certainly bias his judgement and, not improbably corrupt his integrity described by James Madison (Bavly, 1999). Because of the Corporate Governance, companies are run in a fair and efficient manner to maximise the wealth of the organisation rather than maximise the profit and that no one person should have too much control. The Institute of Chartered Accounts for England and Wales (ICAEW, 2002) discuss the importance of Corporate Governance in more details, ICAEW (2002) explain that because of the corporate scandals, Corporate Governance came into motion or it can also be said corporate scandals is the main driver for Corporate Governance as it highlights what can actually happen and also the devastating affects. The ICAEW (2002) also indicated that because of the awareness and the increased knowledge of shareholders have lead to companies to improve there presentation in the market and also to improve the way in which they operate in order to attract investment. Shareholder influence affect the structure of an organisation (Investments) so they having a positive impact on Corporate Governance as it is a key driver for the implementation of Corporate Governance to many companies. Iskander and Chamlou (2000) explain that, to increase the market value and the market share good corporate Governance is essential. This is a key subject to consider because if the management is not performing efficiently and effectively, then money is going to be spent on agency problems, which arise. However with good Corporate Governance the board is working more consistently. Coyle (2003/2004) explains that there is also a difference of interest between directors of a company and its shareholders. The directors need to earn more benefits and high remuneration whereas the shareholders want the company to be earn more profit or to maximise the profit of an organisation so that they can cover there cost of capital. Corporate Governance allows shareholders and Directors to set criteria to come to an friendly agreement. This allows to set out exact guidelines to each other thus reducing conflict. (PriceWaterHouseCooper, 2004) The above figure is taken from a survey conducted by PriceWaterHouseCooper in year 2004, undertaking 134 executives. The executive were ask, what was the main reason for the failure of Corporate Governance. 37% of the executives replied because of the compliance failures and 26% replied because of the poor management and also because of the poor leadership. The conduct of senior executives was also a major risk according to 15% of directors. The figure clearly shows that Corporate Governance strongly focuses on activities such as leadership of executives. Corporate Governance in the USA Corporate Governance in the United States of America (USA) is different in some way from United Kingdom, however there are some similarities. In America the first Corporate Governance documents, was Treadway Report (Chartered Institute of Management Accountants, CIMA, 1999). It emphasis on auditing, which it stressed must be separate from directors (CIMA, 1999). There are many forces that have led to the development of corporate governance in the U.S. as it appears now. The problem of the corporate governance in U.S is that there is not a set of laws or regulation to decide how organization matters are to be addressed. There are two side-by-side laws first is Federal law and Second is state laws, and traditionally corporate governance is a matter of state, so it is determine by the sate laws. This recommendation of corporate governance was aimed at reviewing the performance and profitability of companies through an independent organization in order for shareholders to have a true pic ture of how the company is performing. The Committee of Sponsoring Organisations of the Treadway Commission (COSO) then produced a further document on Corporate Governance which was based on Internal Control (CIMA, 1999). This was designed to discuss how a company should be run and appropriate controls, which would ensure this. After the corporate scandal of Enron, the Sarbanes-Oxley statute is really a federalization of corporate law. Sovereign of written statutes and regulations, the U.S. is a common law system so a great deal of the law on corporate governance comes through judicial decisions. The United States of America introduced corporate governance legislation in 2002, the Sarbanes Oxley Act (SOX). High profile corporate collapses due to a number of circumstances including financial reporting irregularities leading to a lack of investor confidence and public trust. The Financial Services Authority (FSA) which is the regulating body of the Financial Services sector in the UK did a number of things in reaction to the Enron scandal (Rouston, 2003). Rouston explains that the FSA conducted a review of listing rules and looking further into the matter of accountancy and auditing (Rouston, K, 2003). However in the USA the response to the growing number of Corporate Scandals and most recently the Enron scandal the USA was different than the UK. The Sarbanes-Oxley Act was introduced in 2001 as a direct response to a number of corporate failures (Matyjewicz and Blackburn, 2003). The Sarbanes-Oxley Act (2002) was useful as it meant that Corporate Governance would have to be taken seriously and that there would be company on the stock exchange who did not comply with SOX (2002). Although the UK does not have legislation many companies do use corporate governance, the Combined Code, in order to attract investors (Financial Aspects of Corporate Governance, 1992). The three reasons for the development of Corporate Governance in USA:- (The Continuing Evolution of Corporate Governance in the United States- Thomas A. COLE Chairman, Executive Committee, Sidley Austin Brown Wood LLP) Capitalistic view has clearly prevailed with specific regulations imposed relating to the treatment of employees and such. The second factor in the development of U.S. corporate governance is that there are very widely held corporations. Another factor that has shaped corporate governance is the rise of the institutional investor. Paying for Good Governance One of the survey done by Mckinsey Company in 2000 all the investors are willing to pay more for a company with good board governance. Nearly 83% in latin America, 81% in US and 89% in Asia they consider that there should be proper control upon the working of the organisation. Source: Mckinsey company, Investor opinion (2000) Corporate Governance: A Mandate for Risk Management? Risk Management is described as identifying and managing a firms exposure to financial risk. Corporate Governance as describe above is a set of rules, procedure and structures by which investors, who invest in an organisation assure themselves that they are getting pre-determined return and they also ensure themselves that there investment is used and invested in efficient portfolio and the managers are not misusing there investment. It is at the top of the international development agenda as emphasised by James Wolfensohn, President of the World Bank: The governance of companies is more important for world economic growth than the government of countries. This section will focus the connection between risk management and Corporate Governance. Corporate Governance and Risk Management are strongly linked and the two are used in conjunction with one another to help companies in the running of a smooth and well-organized business. One of the main reasons for the implementation of Corporate Governance is to stop Corporate Failings and Turnbull highlights that that drive the business forward, some risks should be taken (Chartered Institute Internal Auditors for UK and Ireland). And is said to calculate risks the use of risk management is essential because even the smallest risk can create big problem for companies. CIMA (1999) explain number of factors which link Corporate Governance with Risk Management, good corporate Governance reduces risks. The purpose of the risk management is to eliminate risk. Risk Management as described by Coyle (2003/04) identifying, assessing and controlling the risks facing a business, and with incorporating risk issues into decision making processes (Coyle, B, P2). And if we compare the definition provided by the (Cadbury, 1992, Coyle, p4) The system by which companies are directed and controlled both the definitions aim to protect the organisation and their investor (equity or debt) and also ensure the smooth running if the organisation. There have been many changes in issues Corporate Governance and Risk Management from the Cadbury Report of the early 1990s to the more recent Turnbull Report of 1999. Well it is now clear to all the boards of directors there responsibility to ensure that all possible threats to an organisation have been systematically identified, carefully evaluated and effectively controlled. Corporate Scandals The Corporate Scandals were occurring on a frequent basis in the 1980s 1990s (The international Corporate Governance Review 2003). This was considered as a worrying condition for investors and companies. Short et al (1998) suggested that corporate scandals can occur for a number of reasons one of the reason given by them was creative accounting, which can explain as not doing the accounts properly and hiding the problems or risk through which the company is exposed. And the investors believe that company is performing and working in a good condition and there investment is safe. They also explained that dishonest of directors also played a vital part in corporate scandals, this can be in many ways such as hiding the fact and telling shareholder that the company is doing well. Nathanson (2002) explain corporate scandals often have elements of political blame. Nathanson explain this by taking the example of Heaths Government in 1972 as they made a drive for growth. Which mean high share prices which affected the economy which was growing at round 5%. And some companies such as Slater Walker went bankrupt (Nathanson 2002). One of the interesting question to analyse is How do (the suppliers of finance) make sure that managers do not steal the capital they supply or invest it in bad projects (Licht, 2003). To protect Investors is the overall main purpose of Corporate Governance and this statement shows the overall purpose for the Corporate Governance. The scandals not only affected the shareholders of the organisation but it also harm the staff, usually financially. So the whole organisation was effected by the Corporate Scandals. One of the article printed in Financial Times in year 2002, which explain the former employees pension which was previously worth $450, 000 is now worth $12,000, this is because of the collapse of the company, and financial time total blame corporate governance (Financial Times, 2002). This shows how the collapse of a massive company such as Enron can have on one individual employee. However we should also understand that shareholder are not only one who are affected by this disaster but it also affected such as the financial services market, a decline in confidence in the market, and the government as it is poor publicity. (Market and opinion research International, 2003) The figure 3.2 highlights that confidence in UK organizations is in-fact fairly high when comparing the above data it is clear that in-fact confidence is rather high with 47% disagreeing that an Enron could occur and 35% strongly disagreeing. But the fact is that only 4% of the directors who were interviewed believe that it was likely or highly likely. To conclude this, now the directors are confident after the effective corporate governance that there wont be another Enron Scandal occurs in the UK. Maier (2005) suggested of the failure of the corporate governance is corporate scandal. And because of these corporate scandals investor loose there confidence over the market (Maier 2005). Because of these corporate scandal government introduce the Cadbury Report (1992) to increase the confidence of the investor (Cadbury Report 1992). The USA also acted in a similar way to the Enron scandal by introducing the Sarbanes-Oxley Act (2002). It appears that corporate scandals have many bad affects but they are a key driver for Corporate Governance. Can directors be trusted to tell the truth? Agree: 17% Disagree: 65% Are directors paid too much? Agree: 75% Disagree: 11% Can firms pension promises be trusted? Agree: 34% Disagree: 43% Can accountants be trusted to check results? Agree: 37% Disagree: 39% (BBC Business, 2002) The above figure was taken from BBC business survey which was conducted in 2002 by surveying 2000 members of the UK public. The survey was conducted soon after the corporate scandals which were because of the failure of the Corporate Governance. When analysing the figure the general public of UK totally lost confidence from the companies and only 17% of the citizen respondents that they trust Directors. So we can conclude by saying that corporate governance is a prime factor or this also be explain as a key element which not only enhance investors confidence but it also promote competitiveness and ultimately the whole economy benefits. The governance of companies is more important for world economic growth than the government of countries (James Wolfensohn, President of the World Bank). Cultural, political and economic norms affect the way in which a society approaches corporate governance and its affects on board leadership, management mistake and accountability. The challenge in front of the policy maker is to reach a balance of legislative and regulatory reform, taking into consideration the best practice to promote enterprise, enhance competitiveness and stimulate investment. Conclusion There are clearly many factors which act to provide incentive for institutions not to involve themselves in Corporate Governance issues. Whilst the level of monitoring by institutions is greater than that commenly supposed, such monitoring tends to be carried out in private, and, as Black and Coffee (1994) note, for most British institutions, activism is crisis driven. Furthermore, it is unlikely that behind the scenes monitoring is satisfactory, particularly from the point of view of the public, as it enhances the belief that institutions and company management are all simply part of the same old boy network, a belief illustrated by the debate concerning the high level of directors remuneration. The increase in number of informations and guidance has increased the knowledge of the companies and has also made the corporate practices more sophisticated. If we go through Cadbury committee report there was lack of internal control however Turnbull report lifted the veil and this report emphasized on internal control as part from other controls. Other countries such as the USA are different from Great Britain, the USA introduce Corporate Governance Legislation called the Sarbanes-Oxley Act. Although the United Kingdom do not have Corporate Governance legislation as such companies feel obliged to follow guidance if wish to attract investment (ICAEW, 2005). Corporate Governance is very much important for these days for the companies who work either in public sector or private sector as it has been highlighted in previous high profile corporate scandals, such as Enron, that lacking of Corporate Governance companies are exposed to being involved in a Corporate Scandal (ICAEW, 2005). Corporate Governance is now becoming a culture of companies in Britain and it is more often used than ever before. Large corporate scandals in the USA, such as Enron, have an affected other countries which also include the UK. Corporate Governance is closely linked to Risk Management; so it is essential to go through the key component in the risk management regime. Chapter 2 Case Studies In order to see the poor performance of Corporate Governance and lack of Corporate Governance legislation it is useful to use the case study approach. It was very important for the dissertation as it highlights the real life example of the poor performance of Corporate Governance. A case study can be defined as a research study which focuses on understanding the dynamics present within a single setting (Eisenhardt 1989, p65). This technique (Case Study) was introduced in 1934 as per the Oxford English Dictionary (2006). According to Stake (1993) the purpose of using two case studies was to see how the failure of corporate governance and there affect on the companies in different ways. One of the key objectives of including these cases is to see the affect of corporate scandals and how they can happen and this aim can be assisted by the case study technique. There are a many limitations however; the company scandals are in different sectors of the economy. The approach of case study is having number of advantage and number of disadvantages as well. By using case studies, comparisons can be drawn, comparing one corporate scandal with the other company scandal (Jankowicz, 2005). It must be noted that when comparing the different corporate scandal they are often very different but the reasons of this occurrence are very much similar. Jankowicz (2005) also highlights that the case study approach is open research method, which can be change on a daily basis. This approach given by Jankowicz is different and difficult to understand as if the case study is changing constantly then it will be time consuming and the other can be possibly confusing. This was problem was solved by setting clear dates of data, to research and not add any irrelevant information or new information unless it was important. Another advantage of case studies is that real life examples support research findings. The aim of this section is to include two corporate scandals as case study and to discuss why and how they have occurred. These case studies were particularly selected to evaluate and highlight the similarities and differences in the arena of corporate scandals in the UK and the USA. The two case studies chosen for this section are from Robert Maxwell (1989) and Arthur Andersen (1991). Case Study one Robert Maxwell Ian Robert Maxwell was born on 6th October 1923 JÃÆ'Â ¡n Ludvik Hoch in the small town of SlatinskÃÆ'Â © DÃÆ'Â ´ly, Slovakia, (now Velyky Bychkiv, Ukraine) into a poor Yiddish-speaking Jewish family. He joined the British Army as an infantry private and fought his way across Europe from the Normandy beaches to Berlin. His intelligence and gift for languages gained him rapid promotion to captain, and in January 1945 he received the Military Cross. It was during this time that he changed his name to Robert Maxwell (wikipedia.org) After the World War 2, Maxwell first worked as a newspaper censor for the British military command in Berlin in Allied-occupied Germany. Later, he used various contacts in the Allied occupation authorities to go into business, becoming the British and United States distributor for Springer Verlag, a publisher of scientific books. (wikipedia.org) The Maxwell scandal was a pension scandal which occurred in 1989 in Great Britain. Robert Maxwell who actually owes the Mirror newspaper group defrauded more than 400 million of employees pension funds (BBC, 2001). Maxwell fell to his death from his yacht in Spain (Picard, 1996). Robert Maxwell was able to fraud the company as he was claiming that he actually owe the whole assets of the company, and he was claiming that he had more assets that he did and the some assets he claimed were not indeed his. The loss/deficit was covered by the pension scheme of the employees from this organisation (Greenslade 1992). Robert Maxwell issued a video in 1989 and he declared to his company employees Your Pension is safe with me (Greenslade, 1992). This video was issued shortly before the Maxwell scandal was uncovered as he was trying to lye with his employees. Maxwell had already experienced much controversy in the years, which had led to the corporate scandal (Ipsen, 1991). The Department of Trade and Industry (DTI) declared him unfit to run any company twenty years before this scandal (Ipsen, 1991). DTI in 1969 actually declared Robert Maxwell unfit to carry any business activities and also declared him to perform such functions which involve any public fund. This was held when one of the renowned company of Maxwell Permagon was in a process of takeover talk with Leasco who reported Maxwell inaccurate profit figures to the DTI (Thomas Turner, 2006). How could this have been prevented? The scandal of Robert Maxwell occurred as Maxwell was the chairman and the chief executive of the Maxwell Corporation, which gave all the right and large amount of power in the absence of proper Corporate Governance (Maier, 2005). The Combined code recommends against this as it may be a conflict of interests (Combined Code, 2005). As Maxwell was performing the duties of Chairman and Chief Executive so it gave him too much power and it is possible that it was this power which allowed him to defraud his companies. There was a different lack of Corporate Governance legislation or even guidance with the first piece not being introduced until 3 years later in 1992 by the Cadbury Committee (Untied Nations, 2003). The lack of guidance or legislation meant that Maxwell was in a position to defraud his employees by playing with their pension funds. Until then there were no specific guidelines to highlight how a company should be run and what are the duties of the directors or chairperson and because of this loophole he Maxwell fraud was not brought to light until it was too late. Robert Maxwell company was listed in the stock exchange until the Maxwell scandal effected the organisation. However with Maxwells employees trusting him with their pensions this could have been one of the assurances which were given, had it been in place. To provide good internal control The Turnbull Guidance was actually designed and it also includes Risk management (ICAEW, 1999). The key failings of the Robert Maxwell scandal were internal control, as no other directors reported what Maxwell was up to, and conflict of interests with Robert Maxwell was the chairman and the chief executive (Maeir, 2005). The internal control failures of Maxwell were vast. Firstly Maxwell employed his sons as non executive directors, when non executive directors are meant to be independent (Maier, 2005). Secondly Maxwell was able to hide these massive debts without anybody realising, which section 4.28 of the Combined Code (1999/2005) aims to eradicate. The fact that Maxwell had already been exposed as being unfit to run a company, employees still trusted him with their pension premiums. However employees may have had little choice if this was the only pension scheme available to them. According to Wheen (2001) the auditors of Robert Maxwells business empires, should have seen what Maxwell was up to. The combined code also concentrates on auditing and if this guidance had been in place perhaps the scandal may never have occurred. Impact of the Robert Maxwell scandal? One of the affect of the Maxwell scandal was that employees who were contributing into the pension scheme lost there money, which were contributing over the years. This is really a main focus point that the ordinary workers lost there saving which was for there benefits and it was because of the dishonest actions of one individual. The impact of the Maxwell scandal was also on the British economy and was vast and it put increasing pressure on the Department of Work and Pensions who wrote advice which suggested that occupational pensions schemes were safe (Abraham, 2006). However the Maxwell scandal highlighted the risk to every occupational pension. Case Study Two Arthur Andersen? Arthur Andersen LLP, based in Chicago, Illinois, was once one of the Big Five accounting firms in the United States of America with revenue reaching $9.3 billion (Brown Dugan, 2002), performing auditing, tax, and consulting services for large corporations. The firm of Arthur Andersen was founded in 1913 by Arthur Andersen and Clarence DeLany as Andersen, DeLany Co. The firm changed its name to Arthur Andersen Co. in 1918 (en.wikipedia.org). Arthur Andersen was working for a big energy giant called Enron Corporation which is an American energy company based in Houston, Texas, United States when they were exposed of a massive corporate scandal (Deakin Konzelman, 2004). Arthur Andersen were convicted in the supreme court, Houston, of shredding important documents of Enron and destroying emails from Enron, which would have involved them in Enrons corporate scandal (Economist, 2005). Arthur Andersen were the accountants for Enron and they were accused of accounting irregularities and a lack of transparency (Uma et al, 2002, p77). Nancy Temple (Andersen Legal Dept.) and David Duncan (Managing Director for the Andersen Houston Office) were cited as the responsible managers in this scandal as they given the permission to shred relevant documents. Since the U.S. Securities and Exchange Commission does not allow convicted felons to audit public companies, the firm agreed to surrender its licenses and its right to practice before the SEC on August 31 (en.wikipedia.org). Arthur Andersen were hired to ensure that the accounts of Enron were correct and valid and they were convicted because they did not ensure this and also because they tried to cover up their lies by shredding documents. Arthur Andersen were first employed by Enron as consultants and then employed as auditors which the SEC (Securities and Exchange Commission) felt were a conflict of interests (Goldstein, 2002). Kadlec (2002) further explains that Arthur Andersen made massive mistakes in the Worldcom scandal and it also appears that auditors Arthur Andersen missed two cases of fraud in Worldcom. This was the bad publicity, which Andersen could have done without as it closely followed the Enron fiasco. On the 10th January Andersen admitted that they shredded important documents and emails regarding Enron which would have incriminated them (Sridharan et al 2002). This was extremely shocking for the economic world including many auditors, as it was their job to catch out accountancy fraud and mistakes, not to assist companies in committing such crimes. Arthur Andersen, much like Robert Maxwell were no strangers to controversy. Andersen had experienced a turbulent past leading up to the Enron and Worldcom scandals (Gredier, 2002). They were connected with the Sunbeam scandal in which the Securities and Exchange Commission ordered them to pay $110 million compensation and also the Lincoln savings and Loans Company (Gredier, 2002). The fact that Andersen had been involved in trouble in the past raises a few questions like why did companies continue to use them as auditors? How could this have been prevented? One of the policy of Arthur Andersen company was to employ cheaper and less experienced staff and one policy was that senior employees will retired at the age of 56 in order to save money (Brown Dugan, 2002). There was now drawback for this policy, this policy may have been financially sensible it did mean that experienced staff were being replaced with inexperienced staff, which is a risk for any business. The Enron fiasco was not the only case with Andersen there was many other case such as Worldcom scandal (Kadlec, 2002). Enron had already been caught up in a similar corporate scandal and companies like Enron continued to use them. Also the fact that the directors of Andersen did not act upon previous mistakes, these mistakes continued to happen. Again the role of Corporate Governance would have played an vital role, however it is difficult to analyse how anybody could have stopped employees from shredding documents. The directors of the company were essentially to blame as they should have known what was happening in their own company. This type of practice is one that is unpredictable however it is largely contributed to the downfall of Andersen. In a strange turn of events when the Enron scandal was made public Andersen were actually auditing the FBI (Federal Bureau of Investigation) for the government according to Senator, Patrick Leahy (2002), who was the chairman Judiciary Committee. Impact of Arthur Andersen Arthur Andersen once employed 85,000 employees however now they only employ 200 employees who only look after legal claims following the scandal which ruined the company (Wall Street Journal, 2005). The corporate scandals which Andersen were involved in cost them dearly as highlighted below in some of the compensation claims: Waste Management 75,000,000.00 Sunbeam 110,000,000.00 Boston Market Bankruptcy 10,300,000.00 Baptist Foundation, Arizona 217,000,000.00 (Wall Street Journal, 2002) The figure highlights some cost associated with Arthur Andersen incurred through corporate scandals in which they had some degree of blame. The estimated cost of these four corporate scandals was $412.3 million Wall Street Journal, 2002. These figures do not show the figures including Enron but these other corporate scandals were deemed to be smaller and the cost of corporate scandals is here. The Sarbanes Oxley Act (SOX) (2002) was introduced in direct response to a number of corporate scandals, namely Andersen/Enron (Economist, 2005). This response was similar to the UKs response to Maxwell and Polly Peck, The Cadbury Report (1992) however the Sarbanes Oxley was legislation which meant companies had to follow the Corporate Governance Guidance set out in SOX (2002). Comparison These two companies experienced different types of corporate scandals. The two comparisons chosen are quite different but this highlights the fact that corporate scandals can happen to any business. There was a degree of dishonesty in both the Andersen and Maxwell scandals, with Robert Maxwell being dishonest and employees and directors being dishonest for Andersen. This dishonesty was at the source of both scandals with Maxwell lying about how many assets he had and Andersen shredding documents which would have incriminated them. There was also conflict of interests in both cases. Robert Maxwell was the chief executive and the chairman (Maier, 2005) and in Andersen they were consultants to Enron before being their auditors (Goldstein, 2002). This meant that in the case of Maxwell he had too much power and in the case of Andersen they had worked for Enron in a different capacity which means that they were no independent, they knew about the inside affairs of the company. These scandals occurred when there were no proper corporate governance legislation / guidance. The first piece of Corporate guidance was not introduced in the UK until 2001, which was the Cadbury Report (Cadbury Report, 2002) and the first piece of Corporate Governance legislation was not introduced to the USA until 2002, The Sarbanes-Oxley Act (2002) (Sarbanes Oxley Act, 2002). This meant that these two companies had no guidance/legislation on Corporate Governance, which meant they could choose how their companies were run. One of the key failures in both corporate scandals was internal control. Andersen was also involved in a number of corporate scandals and nothing was done within the company to stop these from occurring. Both of the above corporate scandals had a positive impact on corporate governance with Andersen leading to the Sarbanes-Oxley Act and Maxwell largely contributing to the Cadbury report. Conclusion Corporate scandals have had devastating affects on companies, in Andersens case the massive fines and loss of business activity. However corporate scandals have benefited corporate governance as the Cadbury guidance was implemented in response to corporate scandals such as Polly Peck and Maxwell (Cadbury, 2002). In the United States the Enron scandal led to the implementation of Corporate Governance legislation. Although both Andersen and Maxwell had an extremely negative affect for many reasons there was one key positive to be deduced which was they both improved corporate governance. Chapter 3 Discussion The purpose of the project undertaken is to analyse the issues in Corporate Governance and the Corporate Scandals. A thorough literature review has been taken into consideration in order to come with a conclusion. The initial part emphasise on different authors research having different Corporate Governance disciplines. One of the main topics discussed was of the development of Corporate Governance and the stages involve in it. The history of Corporate Governance is dated back to 1920s, when the running of business was debated by to Americans (OECD, 2004). It began with a single document i.e. Cadbury Report, on a later stage it was followed by a number of others that were Greenbury (1995), Turnbull (1999/2005) and Combines Code (1998/2003). It started on a narrow scale having various disciplines of Corporate Governance in individual documents. Then there was an introduction of the Combined Code in (1998/2003), the purpose of which was to guide the organisations through one document incorporating good leadership in them. To assist the companies in their internal control section of the Combined Code, the Turnbull Report was introduced. Corporate Governance has become a hot topic in debates over the number of years having a turning point by coming in the UK listing rules in 1998 (FSA, 2003), which abide companies to disclose what procedure are they following or whether or not they follow the combined code. Thi s disclosure of codes push the companies into trouble if they are not applying as the chances to have less investments were there and vice versa. The Combined Code was a assurance for investors that the company is run honestly and efficiently. The last decade of twenty first century has given a rise to Corporate scandals with examples in the UK being Robert Maxwell and Polly Peck, in USA as Enron and Shell (Parkinson Kelly, 1999). Due to these scandals the investors security and trust was lost from giant organisation as their investment was vulnerable at such places. UK established the Cadbury Report (1992) when acting upon the bad publicity of Corporate scandals and USA introduced the Sarbanes-Oxley Act (SOX) (ibid). The link between Corporate Governance and Corporate thus, is very strong. The above scandals in UK and USA were happened due to a lack of control. Therefore, Corporate Governance provided the necessary controls on the organisation to avoid any mishap and give the investors assurance that their investments are safe and in a growing place. Limitations The limitation when handling the issue of Corporate Governance in this report were mainly due to the different aspects of the subject area, as different authors have different views and everybodys opinions are subject to bias. This was mainly overcome by sticking to the guidelines provided in the aims and objectives of the report. The time duration to complete this report was also a matter due to a large amount of literature document was to be undertaken. The deadline outlined by the University authorities was strict and the work was expected to be prÃÆ'Â ©cised. These limitation were eliminated by setting up deadlines, for number or weeks to ensure some productive result. Conclusion The objectives of the report were attained by analysing different literature and theoretical background of subject matter. The case studies involved in the report allowed a solid background of examples of two companies who already have experienced Corporate scandals. Both are different from each other, Maxwell is a publishing company and Andersen is in auditing business. But a number of reason from both the failures pointed out were similar. The internal control and dishonesty were mainly lacking in both the cases. These and other such failure has led the intervening organisation to change the ongoing system to maintained trust and honesty, thus Corporate Governance is changed now and is evolving into a better shape. The combined code of Corporate Governance (1998/2003) and The Turnbull Guidance (1999/2005) are now in place as two concise and informative documents. USA has introduced in the legislation for companies to be enforced by Corporate Governance but in UK the companies on the stock exchange has to declare where they are complying with it or not. The Cadbury Report (1992) was implemented as the direct response to corporate scandals, which were highlighted through the introduction of Corporate Governance Guidance. The negative effects through Corporate scandals were so many from which the main were job losses and shareholders trust loss but these were also the main idea for intervening the organisations with regards to Corporate Governance. Recommendations The discussion on Corporate Governance is widespread in around every country disregards of it is developed or developing. However, there might be different methods of having a check and internal control on different companies in different states due to the countries economic policies as Russia and China are following a different economic ideology as compared to USA and UK. The comparison between these two ideological background of internal control could be useful in line with further changes and evolution to Corporate Governance. Since past fourteen years, Corporate Governance has evolved a lot, when the Cadbury Report was introduced and for further research, it could be a worthwhile project to analyse corporate governance changes in these years. References American Institute of Public Accountants, 2002, Summary of Sarbanes-Oxley Act of 2002, [online]. Available from: https://www.aicpa.org/info/sarbanes_oxley_summary.htm Bavly, D.A, 1999, Corporate Governance and Accountability; What role for the Regulator, Director and Auditor? Quorum Book, Connecticut British Broadcasting Company, October 2003, Action Network, Financial Services Authority, [online]. Available From: www.bbc.co.uk/dna/actionnetwork/A1178624 British Broadcasting Company, 30 March 2001, City braced for Maxwell Report, [online]. Available from: https://news.bbc.co.uk/1/hi/business/1249127.stm Brown Dugan, K I, July 2002, Arthur Andersens Fall From Grace Is a Sad Tale of Greed and Miscues, Wall Street Journal,[online]. Available from: https://bodurtha.georgetown.edu/enron/Arthur%20Andersens%20Fall%20From%20Grace%20Is%20a%20Sad%20Tale%20of%20Greed%20and%20Miscues.htm Cadbury Report, 1 December 1992, Financial Aspects of Corporate Governance, Gee publishers, London Carson, T.L, Self-Interest and Business Ethics: Some Lessons of the Recent Corporate Scandals, Journal of Business Ethics, Volume 43, Number 4, Springer Publishers Chambers, A, 2002, Tolleys Corporate Governance handbooks, 2002, Tolley publishers, Clarke, T, 1998, the contribution of non-executive directors to the effectiveness of corporate governance, Leeds Business School, [online]. from: https://emeraldinsight.com/Insight,ViewContentServlet?Filename=/published/emeraldfulltextartcile/pdf/1370030304.pdf Combined Code on Corporate Governance,2003, Section 1A Directors, the board, [online] from:https://www.ecgi.org/codes/documents/combined_code_final.pdf Combined Code of Corporate Governance, 2003, Financial Reporting Council, [online]. From:https://www.frc.org.uk/documents/pagemanager/frc/Web%20Optimised%20Comb ined% 20Code%203rd%20proof.pdf Coyle, B, Corporate Governance, ICSA Professional Development, 2003-2004 Drennan et al, 2001, From Cadbury to Turnbull: Finding a place for Risk Management, Chartered Institute of Public Finance and Accounting Deakin Konzelmann, S S, April 2004, Learning from Enron, Volume 12, Issue 2, [online]. Available from: https://www.blackwell-synergy.com/doi/pdf/10.1111/j.1467-8683.2004.00352.x Economist, 2004, Leaders: Reversed and remanded; Arthur Andersen. London: Vol.375, Issue 8429; pg. 13 Financial Reporting Council, December 2004, The Turnbull Guidance as an evaluation framework for the purposes of section 404(a) of the Sarbanes-Oxley Act, [online]. Accessed from: https://www.frc.org.uk/documents/pdf/draft_guide.pdf Financial Reporting Council, 2005, FRC Review Endorses the Turnbull Guidance, [online]. Available from: www.frc.org.uk/press/pub0822.html Financial Services Authority, May 2000, The Combined Code, Principles of good governance and code of best practice, [online]. https://www.fsa.gov.uk/pubs/ukla/lr_comcode.pdf Freeman,R.E, 1984, p32, Strategic Planning: a Stakeholder Approach, Pitman publish. Gordon, J, 2003, Governance Failures of the Enron Board and the New Information Order of Sarbanes-Oxley, Connecticut Law Review, Volume 35, issue 3, [online]. Available from: https://connecticutlawreview.org/archive/vol35/spring/JGordon.pdf Greenbury Report, 1995, Greenbury Report of Directors Remuneration, Institute of Internal Auditors Greenslade, R, 1992, Maxwells Fall, Simon Schuster, New York, NY Her Majestys Treasury, 2006, Financial Services, [online]. Available From: https://hm-treasury.gov.uk/documents/financial_services/fin_index.cfm Hoch, JL, 2006, Robert Maxwell, published by Pearson Education, [online]. Available From: https://infoplease.com/ipa/A0771967.html Institute of Chartered Accountants for England and Wales, 2002, What is Corporate Governance? Why is Corporate Governance Important, [online]. Accessed from: https://icaew.co.uk/index.cfm?AUB=TB21_78822|MNXI_78822 Institute of Chartered Accountants for England and Wales, Corporate governance developmentsintheUK,2006,[online].Available from:https://www.icaew.co.uk/index .cfm?AUB=TB2I_78921%7CMNXI_78921#request.defaultDomain#/index.cfm?route=120907 Institute of Internal Auditors UK and Ireland, Effective Governance, Practical Guide on Implementing risk management and internal control governance requirements, 1999 Institute of Chartered Accountants for England and Wales, What is Corporate Governance? Why is Corporate Governance Important, 2002, [online]. Accessed from: https://www.icaew.co.uk/index.cfm?AUB=TB2I_78822|MNXI_78822 London School of Economics, 2004, Londons Place in the UK Economy, 2004, [online]. Available from: https://www.cityoflondon.gov.uk/NR/rdonlyres/8A9CA517-32DE-4027-8E96-8CEDECF4185C/0/BC_RS_londonsplace_0410_FR.pdf London Stock Exchange, 2006, Response to Financial Reporting Councils Review on the combined code,[online]. Available from: https://www.londonstockexchange.com/en-gb/about/Newsroom/regulatorypolicy/responsetothefinancialreportingcouncilsreviewofthecombinedcode.htm London Stock Exchange, 2006, Non Executive Director definition, [online].from: https://www.lse.co.uk/financeglossary.asp?searchTerm=iArticleID=1138definition=non-executive_director Maier, S, 2005, How Global is good Corporate Governance?, Ethical Investment Research Services, [online] from: https://corpgov.nl/page/downloads/corpgov05.pdf Market and opinion Research International, 2003, [online]. from: https://www.mori.com/polls/2003/rsmrobsonrhodes.shtml Office of the Director of Corporate Enforcement, 2006, Stakeholders, [online]. 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Rinninsland, R, 2003, Understanding the Act of Sarbanes Oxley 2002, Council for International Tax Education Inc, [online]. from:https://www.citeusa.org/articles/ox.htm Rouston, K, Regulation in the post Enron World, Financial Services Authority, International Corporate Governance Review, 2003, Euro Money publishers Sarbanes Oxley, September 2002, Summary of Sarbanes Oxley Act, [online]. Available from: https://www.sarbanes-oxley-forum.com/ Sarbanes Oxley 101, July 2002, Sarbanes-Oxley Act of 2002, [online]. Accessed from: https://www.sarbanes-oxley-101.com/sarbanes-oxley-TOC.htm Shaou, J, 2001, The Maxwell report: a revealing picture of life in the City of London, World Socialist, Published by the International committee for the Fourth International (ICFI), [online]. Available from: https://www.wsws.org/articles/2001/apr2001/max-a16.shtml Stock Market Crash, South Sea Bubble, 2005, [online.]. from: https://www.stock-market-crash.net/southsea.htm Tricker, R.I, Corporate Governance, Practices, procedures and powers in British companies and their boards of Directors, The Corporate Policy Group, Oxford, Gower publishing Group

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Functional Transition Assessment Free Essays

Functional Transition Assessment attempts to integrate the student into the work force while the student is still in high school. It provides a temporary bridge or support structure for the student making the transition from an educational to a vocational environment. Although all students can benefit from such support, for students with disabilities such a program can prove especially critical. We will write a custom essay sample on Functional Transition Assessment or any similar topic only for you Order Now Also by incorporating vocational education early on to the student’s high school career, Functional Transitional Assessment can instill a sense of responsibility in the student and confirm the practicality of the student’s education. Thus, in can act as motivational tool to succeed in the classroom and in workforce. In your opinion, how important is self-determination for the Exceptional Student Education student in accomplishing his/her educational goals? The Exceptional Student Education student may often feel that he or she has been denied the ability to exercise much autonomy and control over his or her daily life, even when under the guidance of well-meaning parents and educators. It is critical that students, to function effectively in the workforce and in society, achieve a sense of autonomy and independence through reasonable, self-determined actions and choices throughout the educational process. Why do you think occupational guidance has become progressively and increasingly more prominent in high schools? The workplace has grown more competitive, technical and specialized in nature, thus there is more pressure upon students to specialize earlier and earlier in their educational careers. The price of a college education has also escalated, causing many students to turn to specifically vocational and technical schools after high school. Students may also wish to seek internships and part-time jobs to fund their educations that convey relevant skills and knowledge to their future full-time careers. Personal-Social Skills. In your opinion, how important is it for a student’s future success in the transition to the work force? Emotional Intelligence, or the ability to work well with others, and to be sensitive to other persons’ needs is a critical aspect of vocational success. It is not enough to know how to perform a task. One must know how to perform to one’s best ability in an organizational context. How to cite Functional Transition Assessment, Papers

Impact of International Marketing Research

Question: Discuss about the Impact of International Marketing Research. Answer: Introduction The study focuses on the figures and facts of the chosen organization in a particular sector along with the description of the industry. In the report, supermarket retail sector of Australia is chosen while the market analysis will be conducted on the organizational context of Coles Supermarkets Ltd in Australia. Coles Supermarket is a subsidiary of Wesfarmers conglomerate that serves the Aussies with quality products from many years ago. Coles is considered as one of the most trusted supermarket retail chain among the Australians. Coles is present in 770 locations in Australia. The company operates both in online and offline markets. Consistency, innovation and delivering values to the consumers of Australia are the main motto of the company towards the community. Apart from that, the study is focused on the current trends, profitability and growth of supermarket retail industry. However, the role of the primary target market towards the decision-making process of the company. On th e other hand, positioning map will be created along with PESTEL analysis, segmenting, targeting, positioning, etc. It will help to describe the competition in the market as well as the steps of Coles that are taken to maintain a sustainable position in the market of Australia. Trends of Industry Australian grocery retail market is evolving very fast and there are many trends that are changing the nature of the market. The trends of the market are influenced by the shifting demographics of the consumer, retail convergence, and evolving online platforms. Many market research has showed that soon the supermarkets of Australia along with the other grocery retail markets. It is due to the excessive use of internet by the consumers the online stores are gaining more priority from the physical stores present in the market. However, the trends of the market are described into three categories of growth, profitability and external market analysis i.e. PESTEL analysis. Growth Grocery retail sector of Australia in the coming three years will change the patterns of the industry. The media fragmentation and the shifting consumer ethnicities and demographics are responsible for creation of the changing retail landscapes of the country in the year of 2017. They are different in many ways so that they can cope up with the changes in the environment. Internet penetration in Australia is responsible for changing the taste and preferences of the customers along with the challenging transitional phase from offline stores to online stores and finally to omni-channel. The digital transition of the market is responsible for creating challenges in the perspective of customer loyalty (Zeriti et al., 2014). It is seen that the supermarkets of Australia are ruled by Coles, Woolworths, Aldi, IGA and other supermarket retails. Coles has huge employee base that are responsible for creating values in the shopping experience of the Australian consumers by providing them qualit y products at affordable price. Profitability The industry is profitable in nature and is dominated by many supermarket retail giants as well as grocery retail stores of the country itself. In the year of 2016, up to the month of September $29.8 billion was spent to Coles, $32.6 billion was spent to Woolworths group, $11.2 billion to Aldi, $8.8 billion to IGA and $7.3 billion to other supermarkets of Australia (Kumar et al., 2013). The supermarkets are profitable in nature. However, the market reaches a level of saturation as the supermarkets of Australia are very competitive in nature. The companies are earning huge profits from the consumers irrespective of the market saturation. They are developing new products as per the demands of the consumers in the market. The trend of the supermarket is predicted as $25543.3 million while it is adjusted as $25616.4 million. It is seen that the supermarket of Australia trend to grow by 1.8% by the year of 2016 (Kumar et al., 2013). Macro Environment It can be said the supermarket industry in Australia is at saturated stage. Companies of supermarkets are competing with each other. The economic environment of Australia is favourable for the growth of the industry as the GDP of the country is growing annually by 2.5%. However, the macro environment of the industry is described in the light of PESTEL analysis. It will be mentioned in the appendix section. It will be explained by following the current trends of the market in the grocery retail sector of Australia (Koh Wong, 2015). Overall market segment The market segments of the grocery retail market in Australia are categorized into two categories. They are primary segments and secondary segments. The primary and secondary target market will be described in terms of the nature and segmentation of the customers. Supermarkets are the place where everyday use goods are available. People can buy everything related to household purpose from the supermarkets. Australian supermarket is also occupied by German supermarkets such as Aldi. Segmentation of the market is done in order to focus on the needs and demands of the customers so that they can serve them better (Kurt Hulland, 2013). Segmentation, targeting, positioning is also used in formulating segment specific marketing strategies while spreading awareness of the offers, discounts, new products, special attractions, etc. to the target customers. The customers are divided into two segments. It will be described in the three parts of segmentation. As supermarkets have every category of goods, hence the company can use many types of tactics in order to attract different target customers. Demographic segmentation includes the age group of the people i.e. the primary target markets. The age group selected by Coles is in between 25 to 50 years of age. The primary target markets of Coles are focused in order to increase the sales of the company. Demographic segmentation is an important form of segmentation used by Coles to specify their categories of products. Apart from that, there are other patterns of segmentation such as geographic segmentation. Geographic segmentation of Coles includes different urban and semi urban areas of Australia. Different types of geographical division are targeted by Coles in order to increase the sales of their products. The demographic characteristics of people also include income group. The average income of the people in Australia is much higher than that of other countries. Hence, the consumers of Australia are capable enough to buy things from the supermarkets of the country. Coles ranked second in terms of the grocery retail industry. However, the company is trying to take the first position in the market. The psychographic segmentation is important because it attracts different types of attributes and habits of the people. The different kinds of user status of the customers are important in order to formulate marketing strategies for it. Apart from that, Coles also formulate products as per the user status of the consumers of Coles. The customer loyalty of the customers are important to Coles as they focused on the developing the shopping experience of the shoppers every year (Fifield, 2012). Besides this, the different strategies that are formulated for attracting more customers in the stores so that they can shop more from Coles than other supermarkets present within the area. The segmentation process is the first step of positioning and targeting their products in the target market. Hence, identification of primary segment is more important than that of other aspects of the strategic management aspects in th e marketing department. Primary segment of market and their decision-making Primary market segment refers to the lady shoppers more than that of the male customers of the country. The primary target market is important for Coles as the values of the customers are important. The core organizational values of Coles are focusing on the customers first. It leads to delivering a good quality product to the consumers as well as excellent customer service. The focus of the company is to involve the customers of the company. The primary segments of the market i.e. the customers (Sheth Sisodia, 2015). Companies who are involved in formulating sustainable strategies are involving their different kinds of stakeholders in their primary decision making processes. There are different kinds of stakeholders such as internal stakeholders and external stakeholders. Internal stakeholders include the people inside the company i.e. the CEO, CFO, and other senior professionals related with the company. External stakeholders of the company include government, customers, sharehold ers, etc. Involvement of external stakeholders is necessary in this context. The customers if they find that they are getting priority from the company, they will shop from Coles only (Lusch Vargo, 2014). On the other hand, improved level of customer service helps in generating more customers through word of mouth promotion. Innovation and focus on customers are the two aspects that the company is putting emphasis. It can be said that Coles is following participative form of leadership by involvement of different types of stakeholders in their strategic decision making process of the company. It is seen that most of the decisions of Coles are made in the favour of the customers. Employees of the companies are trained in a way so that they can deliver their best while serving the customers in order to maintain customer loyalty. Customers of the company are indirectly involved in the decision making process of the company. Employees of Coles are taking constant feedback from the customers regarding product development. They are trained in a way so that they can understand the latent needs of the customers. Customers and employees both are considered as an asset of the organization. Apart from that, there are different types of techniques used by Coles in their online platforms while engaging different types of customers. Online techniques are most common techniques that are used not only by different supermarkets of Australia but also used by all multinational companies of the world. Popularity of the company nowadays is depended on the online methods of improved engagement of people (Kumar et al., 2013). It is also considered as different kind of involvement of decision making process of the company. Competition As it is earlier discussed that, Coles is considered as the second most popular supermarkets of Australia in terms of popularity, size, market share and revenue, it is trying to occupy the first position in the supermarket industry of Australia. The company is increasing its sales by different techniques of innovation adopted by the strategic management department of the company. It is seen that Woolworths is considered as the number one supermarket retail chain in Australia in terms of revenue, employees, market share and size of the company. The strengths of Woolworths is its employee base (Leonidou et al., 2013). The huge employee base is responsible for creating a good opportunity for increasing the employment of the country. Coles on the other hand ranks second. The number of employees of Coles is less than that of Woolworths. The image of the brand and the reputation of the brand is important for both the companies. Apart from that, it can be said that there are two other compa nies that are ruling in different types of urban and suburban areas of the country. They also have a good market share and reputation in the market. The companies are German supermarket retail giant Aldi and IGA. Apart from that, there are different types of competitions that the supermarkets are facing in order to achieve a good market share. The main competition is the price war. All the major supermarkets are developing constantly new products at a lower price. Cost leadership is followed by most of the companies (Armstrong et al., 2012). Apart from that they are following economies of scale. The big supermarket giants apply the process of cost leadership is penetrating new areas of Australia while obtaining economies of scale in their methods of production, distribution and marketing of goods. Positioning map Positioning map in marketing is the process of creating a diagrammatic representation that is used by the strategic management department and the marketers while capturing the different levels of perceptions of the customers regarding the different attributes of the brand. The customers in this study include the primary target markets. Another name of positioning map is known as perceptual map. It is used in order to position a company or a line of products in the market (Berthon et al., 2012). In the report, a positioning map for Coles will be provided so that Coles can find its position in the market. The map will be formulated after taking feedback from the customers and the reputation of the company in the market. However, the determinants of the map are also formulated as per the feedback provided by the customers. Conclusion The report illustrates different aspects of Coles in terms of competition, segmenting, targeting, positioning and other aspects of marketing attributes. There are various types of facts and figures that are included in the report so that Coles can develop strategies regarding the different types of marketing strategies of the company. It is seen that the industry is competitive in nature with different kinds of technological advancements used by the companies in order to satisfy the needs of the customers. The report illustrates that the different kinds of retailers are in the matured phase as the trend of customers preference, increasing day by day while an increase in the expectations of the consumers as a whole. Improved facilities and excellent customer service are provided by all the companies. Coles must innovate new strategies in order to improve the base of the customers. References Armstrong, G., Kotler, P., Harker, M., Brennan, R. (2012).Marketing: an introduction. Pearson Prentice-Hall, London. Berthon, P. R., Pitt, L. F., Plangger, K., Shapiro, D. (2012). Marketing meets Web 2.0, social media, and creative consumers: Implications for international marketing strategy.Business horizons,55(3), 261-271. Fifield, P. (2012).Marketing strategy. Routledge. Koh, A. C., Wong, J. K. (2015). The Impact of International Marketing Research on Export Marketing Strategy: An Empirical Investigation. InProceedings of the 1990 Academy of Marketing Science (AMS) Annual Conference(pp. 172-175). Springer International Publishing. Kumar, V., Bhaskaran, V., Mirchandani, R., Shah, M. (2013). Practice prize winner-creating a measurable social media marketing strategy: increasing the value and ROI of intangibles and tangibles for hokey pokey.Marketing Science,32(2), 194-212. Kurt, D., Hulland, J. (2013). Aggressive marketing strategy following equity offerings and firm value: the role of relative strategic flexibility.Journal of Marketing,77(5), 57-74. Leonidou, L. C., Leonidou, C. N., Fotiadis, T. A., Zeriti, A. (2013). Resources and capabilities as drivers of hotel environmental marketing strategy: Implications for competitive advantage and performance.Tourism Management,35, 94-110. Lusch, R. F., Vargo, S. L. (2014).The service-dominant logic of marketing: Dialog, debate, and directions. Routledge. Sheth, J. N., Sisodia, R. S. (2015).Does marketing need reform?: Fresh perspectives on the future. Routledge. Zeriti, A., Robson, M. J., Spyropoulou, S., Leonidou, C. N. (2014). Sustainable export marketing strategy fit and performance.Journal of International Marketing,22(4), 44-66.

Karma Essays (2962 words) - Shabda, Reincarnation,

Karma KARMA and REINCARNATION Navigate: Ashram| Gurudeva | Newspaper | Church | Temple | Resources | HHE | Himalayan Academy Home Page The twin beliefs of karma and reincarnation are among Hinduism's many jewels of knowledge. Others include dharma or our pattern of religious conduct, worshipful communion with God and Gods, the necessary guidance of the Sat Guru, and finally enlightenment through personal realization of our identity in and with God. So the strong-shouldered and keen-minded rishis knew and stated in the Vedas. And these are not mere assumptions of probing, brilliant minds. They are laws of the cosmos. As God's force of gravity shapes cosmic order, karma shapes experiential order. Our long sequence of lives is a tapestry of creating and resolving karmas-positive, negative and an amalgam of the two. During the succession of a soul's lives-through the mysteries of our higher chakras and God's and Guru's Grace-no karmic situation will arise that exceeds an individual's ability to resolve it in love and understanding. Many people are very curious about their past lives and expend great time, effort and money to explore them. Actually, this curious probing into past lives is unnecessary. Indeed it is a natural protection from reliving past trauma or becoming infatuated more with our past lives that our present life that the inner recesses of the muladhara memory chakra are not easily accessed. For, as we exist now is a sum total of all our past lives. In our present moment, our mind and body state is the cumulative result of the entire spectrum of our past lives. So, no matter how great the intellectual knowing of these two key principles, it is how we currently live that positively shapes karma and unfolds us spiritually. Knowing the laws, we are responsible to resolve blossoming karmas from past lives and create karma that, projected into the future, will advance, not hinder, us. Karma literally means deed or act, but more broadly describes the principle of cause and effect. Simply stated, karma is the law of action and reaction which governs consciousness. In physics-the study of energy and matter-Sir Isaac Newton postulated that for every action there is an equal and opposite reaction. Push against a wall. Its material is molecularly pushing back with a force exactly equal to yours. In metaphysics, karma is the law that states that every mental, emotional and physical act, no matter how insignificant, is projected out into the psychic mind substance and eventually returns to the individual with equal impact. The akashic memory in our higher chakras faithfully records the soul's impressions during its series of earthly lives, and in the astral/mental worlds in-between earth existences. Ancient yogis, in psychically studying the time line of cause/effect, assigned three categories to karma. The first is sanchita, the sum total of past karma yet to be resolved. The second category is prarabdha, that portion of sanchita karma being experienced in the present life. Kriyamana, the third type, is karma you are presently creating. However, it must be understood that your past negative karma can be altered into a smoother, easier state through the loving, heart-chakra nature, through dharma and sadhana. That is the key of karmic wisdom. Live religiously well and you will create positive karma for the future and soften negative karma of the past. Truths and Myths About Karma Karma operates not only individually, but also in ever-enlarging circles of group karma where we participate in the sum karma of multiple souls. This includes family, community, nation, race and religion, even planetary group karma. So if we, individually or collectively, unconditionally love and give, we will be loved and given to. The individuals or groups who act soulfully or maliciously toward us are the vehicle of our own karmic creation. The people who manifest your karma are also living through past karma and simultaneously creating future karma. For example, if their karmic pattern did not include miserliness, they would not be involved in your karma of selfishness. Another person may express some generosity toward you, fulfilling the gifting karma of your past experience. Imagine how intricately interconnected all the cycles of karma are for our planet's life forms. Many people believe in the principle of karma,

Bitch essays

Bitch essays William Henry Harrison was born the youngest of seven kids in 1773, at his familys plantation in Charles City County, Virginia. His father, Benjamin Harrison, was into politics and was a statesman. His mother, Elizabeth Basset, was a housewife. He studied classics and history at Hampden-Sydney College, and then began the study of medicine in Richmond. In 1791, however, he switched interests. He decided to pursue his military career. Harrison wanted to be a soldier when he was eighteen. He asked none other than George Washington if he could become a soldier. Washington decided to make him an officer, because he wanted Harrison to rise high in the army. A week later, Harrison received his officer uniform, complements of George Washington. Harrison was in the First U.S. Infantry, and was sent on duty to the Northwest Territory. In 1794 he was cited for bravery after fighting in the Battle of Fallen Timbers against a group of Native American peoples. The following year he was made Commander of Fort Washington in Ohio. Soon after, he married Anna Symmes. Harrison resigned from the army in 1798 and became Secretary of the Northwest Territory. In 1799 he was elected territorial delegate to the Congress of the United States. As delegate, he persuaded Congress to divide the public lands of the territory into small homestead lots. In 1800, Harrison pressed legislation to create the Indiana Territory, of which he was appointed governor. During his twelve years as governor of the territory, he persuaded native peoples to give their claims in almost the whole territory by getting them drunk. To me, this was his first major mistake in his political career. When Shawnee chief Tecumseh and his brother Tenskwatawa formed an alliance of Native American Peoples to oppose further conquest of their lands, Harrison came back to the army to lead a powerful American force against them i ...