Accounting Theory and Principle Report 2022

Running Head: ACCOUNTING THEORY AND PRINCIPLE
ACCOUNTINGTHEORY AND PRINCIPLE
Name of the Student
Name of the University
Author Note

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Table of Contents
Introduction................................................................................................................................2
Background of Company.......................................................................................................2
Discussion..................................................................................................................................3
Background of Corporate Governance of Company..............................................................3
Background of Sustainability and CSR policy of Company..................................................3
Corporate Governance Mechanism of Company...................................................................4
Sustainability and CSR Initiatives by Company....................................................................5
Recommendations......................................................................................................................7
Conclusion..................................................................................................................................8
Reference....................................................................................................................................9

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Introduction
The corporate governance is the term, which encompasses various activities that are
connected with the management of the organizations. It affects the performance of economic
firms as well as their ability for attracting capital that are required for the growth of economy.
The standards of the corporate governance are applied by company for ensuring the adequate
protection of shareholders interest, regardless of holdings sizes. Further, sustainability
practices are defined as the processes for maintaining the qualities, which is value in physical
environment. The company prepares sustainability report for providing the information about
the social, economic, environmental as well as governance performance. The growing
number of ethical issues as well as environmental concerns of the company among the
investors has necessitated for making disclosures regarding corporate governance and
sustainability (Mason, Chris, and John Simmons 2014).
Hence, this report includes the discussion regarding corporate governance and
sustainability practices of Woolworths Group Limited. Moreover, based on the analysis,
recommendations will be given for the improvement in policy of the corporate governance as
well as sustainability.
Background of Company
Woolworths Group is the ASX listed company based in Australia. It is the major
Australian company that is having extensive retail interest throughout New Zealand and
Australia. This company manages certain most recognized as well as trusted brands of
Australia. It endeavors for creating the world-class experiences for their customers. In terms
of revenue, it is second largest company in the Australia by revenue
(Woolworthsgroup.Com.Au.2019).

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Discussion
Background of Corporate Governance of Company
The good corporate governance is fundamental approach of Woolworth Group
Limited for enhancing the long-term value for their shareholders. The company follows the
corporate governance in their retail business. It is the complex group of business, which are
exposed to the ranges of the strategic, operational, financial as well as compliance related
risks. These are the risks, which are inherent in operating the retail as well as businesses that
includes liquor, food, general merchandise, petrol and operations such as accommodations,
dining, gaming and bar. The Woolworths Group designs the framework with governance
structure for providing sound framework in the management of the material risks to conduct
the business.
Woolworths Group expects their directors as well as employees for acting responsibly
as well as ethically at all the times. The company makes disclosures of their regarding
corporate governance by providing corporate governance statement (Misangyiet al. 2014). It
helps in describing the important policies as well as practices of the corporate governance of
Woolworth’s groups at each reporting period, approved by company’s board. The company
follows every recommendation of ASX principles throughout the period. The Woolworths
Group management as well as Board is committed towards practices as well as policies,
which meets higher level of the compliance and disclosures
(Woolworthsgroup.Com.Au.2019)
Background of Sustainability and CSR policy of Company
The Woolworth Group is the diverse group of the businesses that is united by the
common purposes by creating better experiences in the together way, which is better for the
lives of the people. The company provides the commitments for building the trust through its
actions. The strategy of the company brings out new focus, energy as well as resources to the

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sustainability by assigning targets under the people, planet as well as prosperity (Sapraet al.
2014). It covers the engagements with the communities, customers, team members, supply
chain and the responsibilities for minimizing impact of environment on the company’s
operations. Moreover, the company value diversity by embracing the targets, which supports
diversity, respect and tolerance (Hughenet al. 2014). The environmental impacts are
recognized by the company, across the value chain as well as works with their providers of
service, suppliers as well as operations for innovating for the healthy planet. Lastly, it focuses
on the positive relationships with the suppliers that give back to the communities, under
which it operates as well as rebuilding the trust with the customers as well as investors
(Woolworthsgroup.Com.Au.2019).
Corporate Governance Mechanism of Company
Following are the mechanisms that are undertaken by company under various
categories:
Board of Directors- The board of the directors serves as well as represents the
shareholders interest. They are accountable to the shareholders for strategic direction
of company for enhancing the value of shareholders. They approve the objectives of
corporate as well as duties and responsibilities of CEO. The composition of board is
majority of the independent non-executive directors who is having mix of the skills
for providing necessary depth as well as breadth of experiences as well as knowledge
for meeting objectives and responsibilities of board (De Haan, Jakob and Razvan
Vlahu 2016).
Board Committees- The company is having four board committees for assisting
board in exercising the responsibilities as well as providing it with the advice and the
recommendations, which are nomination committee, sustainability committee, people
performance committee and audit, compliance committee and risk management. Each

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of the board committee has the charter, which defines their roles as well as
responsibilities (Caiet al. 2015).
Risk Management and Assurance- The Woolworths Group is the complex group of
the businesses, which are exposed to the ranges of the operational, financial, strategic
as well as compliance related risks. The company is having the framework of
enterprise risk management that together with structure of governance is designed for
providing the sound framework for the management of the material risks of
conducting the business (Woolworthsgroup.Com.Au.2019).
Communication with Shareholders- The shareholders as well as the other
stakeholders are informed regarding all the material matters that affect the company
by the ASX announcements, ranges of the publications and forums as well as periodic
communications, which are available at company’s website. Moreover, other
engagement activities of shareholders includes the annual report, the annual general
meeting as well as regular releasing of financial statements that includes half and full
year reports (Woolworthsgroup.Com.Au.2019).
Diversity and Inclusion- The company values diversity as well as inclusion all across
the business as they wants for making the members of team feel valued, empowered
as well as respected. The company works for retaining as well as attracting inclusive
workforce with the positive customer focus with the help of providing equitable, safe
as well as engaged working environment. The continuous review of the strategies as
well as goals is done for supporting diversity and inclusion culture
(Woolworthsgroup.Com.Au.2019).
Sustainability and CSR Initiatives by Company
Following are the initiatives undertaken by company under categories of social,
environmental and economical:

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People- Woolworths Group builds the culture, which allows the team members for
enjoying same rewards, opportunities and the rewards, apart from of the gender. The
strong workforce embraces the diversity in every forms and it is underpinned by the
participation and inclusion culture. Moreover, company has achieved their
commitments by retaining and recruiting more Torres Strait and Aboriginal Islander
team members. It has achieved the status of Gold Tier Employer in AWEI and LGBTI
inclusion. The company continuously strives for improving safety as well as
wellbeing of the customers and team for providing them with safest possible shopping
as well as working environment (James 2014).Woolworth Group promotes gender
equity. There are at least forty percent of the executive as well as senior manager
positions that is to be held by the women and there is no gap of salary between the
male as well as female employees of the equal position on the per hour rate at all the
levels of the company (Woolworthsgroup.Com.Au.2019).
Planet-Woolworths Group implements the initiatives for reducing the wastage of
food as well as building on the partnership of food rescue for providing food reliefs to
those who are in need. They looks at ways for removing or reducing packaging of
plastic as well as providing the opportunities for the customers for recycling and
contributing to circular economy. The company looks to the sources of high impact
commodities from the sustainable supply chains as well as continue for raising the
awareness of this to the suppliers and customers. The effects of the climate change are
recognized and understand by the company. It may effect their operations, customers,
economy as well as communities. Lastly, company works closely with the suppliers
for improving animal welfare under its care (Hahn, Rüdiger and Regina Lülfs
2014).Woolworths Group has achieved net zero supply chain deforestation for the
commodities of ‘high impact’ in their own products brand, for instance pulp and

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paper, packaging, palm oil and timber. They have improved recyclability of their own
packaging of brands and it contributes towards circular economy
(Woolworthsgroup.Com.Au.2019).
Prosperity- The company works with their suppliers by building long-term
partnerships, fostering trust and encouraging open communications. The core value of
the company is “I care deeply”. It is relevant particularly in the approach towards
responsible sourcing and managing workers rights towards the global supply chain.
The company is committed towards contributing equivalent of at least one percent of
pre-tax profits on the three-year rolling averages each year to the causes of
community (Bonilla-Priegoet al. 2014). Moreover, donating cash, in-kind to the
various charities across New Zealand and Australia. The company supports their
communities during the natural disasters. In addition, other measures includes
responsible towards service of alcohol, creation of shared value with customers,
giving back to communities in which it operate (Dissanayakeet al. 2016).Woolworths
Group has achieved top quartile ranking on the way company engages fairly as well
as equitably with the suppliers as measured by the independent supplier surveys
(Woolworthsgroup.Com.Au.2019).
Recommendations
The Woolworths Group is recommended for improving the practices of the corporate
governance includes increasing more diversity as some of the boards may lack diversity.
There should be appointment of more competent board members and also there should be
mechanism for measuring the performance of board.
In context of sustainability practices of the company, it is suggested that company
should create the sustainability coordinator position and increasing more efforts towards
communication.

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Conclusion
Therefore, it is concluded that effective and efficient corporate governance requires
having clear understanding of the respective roles of the Board as well as senior management
and the relationship with others in structure of corporate. The exercise of the corporate
governance is possible through participation of board. It sets out rules that define
relationships that exist between management, board of directors and stakeholders of company
as well as influences the way company is operating. Moreover, it has been analyzed that
sustainability reporting enables the company for considering the wider range impacts of the
issues of sustainability and enabling them for being more transparent about opportunities and
risks they are faced with. Further, it is found that Woolworths Group is committed towards
enhancing the value of shareholders by providing good corporate governance. Lastly, it is
found that company makes significant commitments throughout the year for moving towards
circular economy.

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Reference
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77-86.

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