AIB Student A12795
ASSIGNMENT COVER SHEET(to be completed by the student) |
AIB student ID number: | A12795 |
Student name: | Shaun Dabypersad |
Course name: | MBA |
Subject name: | Corporate Governance |
Subject facilitator: | Keisha Butcher |
Teaching Centre: | Sital College |
No. of pages: | 10 |
Word count: | 2431 |
I, the above named student, confirm that by submitting, or causing the attached assignment to be submitted, to AIB, I have not plagiarised any other person’s work in this assignment and except where ...view middle of the document...
This paper seeks to review the corporate governance aspects of my organisation, TSTT. A standard definition of corporate governance and its scope is supplied. Within each section, the relevant theory is stated, accompanied by its source and then shown how it applies to the organisation. A critical analysis of TSTT regarding each principle discussed is contained within the sections. The paper goes on to show that the company does in fact have an effective corporate governance framework in place, as it continues to provide profits to its shareholders, and at the end gives some practical recommendations for overall improvement to its current practices.
Corporate governance has been around for as long as we can remember. The phrase however only gained popularity around the 1980's, but was soon adopted worldwide. With the advent of the Enron crash in 2001, as well as the global financial crisis in 2007, countries with advanced and advancing economies have introduced governances codes and company laws that add to growing set corporate governance policies and practices(Tricker, 2012). "Corporate governance is about the way power is exercised over corporate entities. It covers the activities of the board and its relationship with shareholders, and with those running the enterprise, as well as with the external auditors, regulators, and other legitimate stakeholders"(Tricker, 2012, p. 4).
This assignment attempts to conduct a review of the structure, processes and effectiveness of the governance of TSTT. The Telecommunications services of Trinidad and Tobago's(TSTT) core business is the provision of telecommunications services to both local and overseas customers. The company is majority state owned, 51% and 49% by Cable and Wireless Caribbean. In this report we seek to review the board structure, conformance and performance roles of board members, the application of corporate governance theories, as well as any governance codes being followed and risk mitigation strategies adopted, and make recommendations for improvements if need be.
The Board's Effectiveness
"It is "board effectiveness" not "board structure" that must be analysed, for it is the effectiveness of the board in the decision-making process that in the final analysis determines corporate performance" (Leblanc, 2003). In order for a board to be effective, it should have the right structure and the right members, performing the right processes.
When analysing board structure, three things are usually considered;
* The leadership, e.g. CEO duality, or the separation of the roles of the CEO and the chair
* The composition, i.e. the number of inside vs. outside directors
* The Size
At TSTT, the roles of the CEO and the chairman of the board are separated. In addition, no person on the board of directors are allowed to be on the board of any other state owned enterprise(Taitt, 2010). The members of the board, appointed by the...