Corporate Governance and Ethics Report on CTD

This report discusses the corporate governance and ethics of Corporate Travel Management Ltd (CTD) with a focus on board orientation, agency theory, stakeholder theory, resource dependency theory, and legitimacy theory.

Running Head: CORPORATE GOVERNANCE AND ETHICS
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Corporate Governance and Ethics
Report on CTD
Student Details

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Executive Summary
The summary of the “Corporate Travel Management Ltd” along with its history is
described in this report. There is an explanation of the corporate governance at CTM. In
addition, there are various theories that are followed by the “Corporate Travel Management
Limited” has also mentioned in this details of all these theories and communication is
described in this report. All the theories that are applied in this company are “Agency
Theory”, “Stakeholder Theory” and “Resources Dependency Theory”. In addition, these
theories support companies. In addition, there is a description of the interpretation of
communication in the CTM with the help of legitimacy theory.

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Contents
Introduction....................................................................................................................3
Corporate Travel Management Ltd................................................................................3
Corporate governance at Corporate Travel Management Ltd........................................5
Board Composition....................................................................................................5
Independent Non: The Chairman and the Director....................................................6
Remuneration Report.................................................................................................7
Board Orientation...........................................................................................................8
“Agency Theory”.......................................................................................................8
“Stewardship theory”.................................................................................................9
“Stakeholder Theory”...............................................................................................10
“Resources Dependency Theory”............................................................................10
Company Communications Interpretation Though “Legitimacy Theory”..................11
Conclusion....................................................................................................................12
Bibliography.................................................................................................................13

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Introduction
Corporate ethics refers to ethics, which examine the ethical problems and states the
ethical principles of the business environment. It is compulsory for the entire organisation to
follow all aspects applied to it, as it is the code of conduct for the businesses.
Corporate Governance has enclosed the management of the company, from taking
various action planes and it has an internal control on the measurement of the performance
(Thomson, 2009).
In this report, there is the introduction of “Corporate Travel Management Ltd”.
The purpose of this report is to have a discussion on its corporate governance, board
orientation with the help of agency theory, stewardship theory, stakeholder theory and
Resource theory. In addition, there is the interpretation of the company communication
through legitimacy theory. At the end of the report, there are the essential outcomes of
corporate governance and ethics at CTM.
“Corporate Travel Management Ltd”
‘Jamie Pherous’ founded CTM in 1994 and was established in Brisbane with the team
of two members in the staff. The aim of this company was to avail the market innovative
global travel managers. The objective of this company is to provide highly personalized
services to their clients, developing innovative ideas for them and provide a flexible solution
to them. In addition, they offer a positive ROI for travel management services (CTM, 2019).
“Corporate travel management Ltd” is one of the largest companies of travel
management in Australia. Since 2010, this company started listed on “Australia Securities
Exchange” with the code name, ‘CTD’ (ASX, 2019). This company provides services

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solutions in the different countries across the global. The headquarters of this company is in
Australia.
The company recent achievements are “Australian Federation of Travel Agent”
awards for 12 times for the “Best National Corporate Travel Management Company” and in
2019, this company had completed 25 years as the successful.
In the recent Plans, the company has included the digital platforms. In addition, as per the
recent plans of company, there is the tremendous support of company to the leading
technologies of the market, which helps in delivering tangible benefits to their stakeholders
and provides a good return on the travel investment. They provide the services in corporate
travel, sports travel, event travel, resource travel and leisure travel. “Corporate travel
management” is providing various travel management programs for businesses. There are
various travel policies of the company, which provide an ample number of opportunities for
saving. In Sport travel management is the specialised sports travel division of the corporate
travel management ltd. They arrange group travels and corporate travels for the sports
industry. In Resource travel management is the specialised resource travel division of the
CTM, which has the ability to fulfil the needs of the resource sectors (CTM , 2019). In Event
management Travel, subsidiary provides services such as event management, venue findings,
production management, delegate management, group travel management and strategic
meeting management.
Corporate governance at “Corporate Travel Management Ltd”
Corporate governance is defined as the system of practices, processes and rules
through which the organisation is directed and controlled. It includes the balancing of the
company’s stakeholder interests. It provides the framework to the company for attaining the

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objectives. In “Corporate Travel Management Ltd” considered the framework of corporate
governance as per specified in Principles mentioned by ASX Corporate Governance Council.
The following points help to understand the corporate governance at CTM.
Board Composition
The following principle determines the board composition, which is as follows:
 The Chairman of the company is Independent Director, which is the responsible
leader for the Board members of the company and its work is to conduct the
organisation in an efficient manner. In addition, it should promote the directors for
the constructive and effective contributions in the company and maintain the
relations among the Boards, Directors, and the Senior Executives.
 In the case, when the Chairman is not an Independent Director then the Board
members must appoint the Deputy Chairman who has the responsibility to take
actions if the Chairman conflicts.
 The Board of CTM is compromised with the expertise and experienced members.
In addition, Directors of the company should always be more than four, and half
of them should be Non-executives Directors and the company for the specific
areas appoints no less than four directors.
 Majority of the Directors of this company are Independent Ones.
 The Board Members have to implement and maintain the skills matrix.
Independent Non: The Chairman and the Director
The Chairman of “Corporate Travel Management Ltd”, Tony Bellas is the
Independent Non-executive Director. The Directors of the “Corporate Travel Management
Ltd” are mostly considered independent and as they are independent, they are free form

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management or any other business of the organisation. However, they can interfere in the
matters of the organisation independently. There are six board members in the organisation
out of which four are considered independent and two of them are executive directors.
Tony Bellas, Greg Moynihan, Admiral Robert and Stephen Lonie are the independent
directors of the company. In addition, Laura Ruffles and Jamie Pherous are considered to the
Executive Directors of the company. Only the board members have the right to decide which
Director is considered as independent (CTM, 2018).
Source: The Directors of Corporate Travel Management Ltd (ASX, 2019)
Remuneration Report
The Directors of “Corporate Travel Management Ltd” based on the last financial year
presents this ‘Remuneration Report’. The key outline of the remuneration policy and
framework for this group had been awarded in the preceding year. The structure of the report

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states the remuneration framework of CTM, elements of remuneration, Executive KMP
remuneration details, Executive KMP contractual arrangements, details of disclosures and
arrangements for the Non-executive Directors. The Key elements of the remuneration are as
follows:
 Fixed Pay
 Incentives for short-term performance
 Incentives for long-term performance through the participation in the “Share
Appreciation Rights Plan”
Board Orientation
Board Orientation refers to the process that helps directors in contributing their tenure
and specifies their role to the board governance. Its purpose is to provide important
information about the organisation. It specifies the rule and responsibility of the Board. In
addition, it should build a relationship among the members of the Board that supports the
agreement of the work, they have done.
Analyse on the Board Orientation
Board Orientations responsibility is of the corporate governance committee. This
program gives a detailed company’s information. There are the various theories which are
followed by CTM explained below of which “Agency Theory” is most important theory for
the Board orientation of the CTM.
“Agency Theory”
The agency theory refers to the management of ownership. In addition, this theory
specifies management assignment from the owners to the managers (Lopes, 2016, pp. 349-

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368). This helps in managing the agency cost and driving the agency relationships of the
firm. In this theory, the firm’s manager works for the self-interest and the wealth maximiser
of the firm as the manager of the company. In this, the manager activities are performed for
the interest of their own rather than for the interest of the shareholder. Corporate governance
of the firm reduces the agency cost. The board works for the identification for the emphasis
of the company annual report, which is based on the report for remuneration. The board has
the responsibility to be aware for the shareholder requirements. The agency theory is
followed by those firms, which have a majority of independent directors.
In the Case of CTM, the orientation is following the agency theory principles.
Recently, the board composition of CTM has mostly the Non-Executive Directors, which are
independent. Most of the directors do not receive the remuneration related to the
performance, as they are the part of good corporate governance. The Board aim is to promote
the shareholder profits, dividend and company’s growth. The Directors and the Executives
remuneration are mentioned in the report. The key communications of CTM are specified in
the Remuneration Report, Company Income Statement and Balance Sheet.
This agency theory helps to understand the relationship of agents and principles in
CTM. The agent of CTM based on agency theory principles, represents all the transactions.
In this theory, the company is more interested to do the work in the favour of best interest
rather than self-interest. This theory helps in the corporate governance at CTM, as to change
the principle’s Interest than also this company use this theory for the organisation.
“Stakeholder Theory”
Stakeholder theory refers to the theory, which required the identification, response and
understanding of its stakeholder's groups. The group of stakeholder involves the customers of
the company, company’s creditors, communities and employees of the company (Johansson,

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2010, pp. 737-744). In this theory, the role of the corporation is to attend the needs of
stakeholders.
In the case of CTM, theory is applied to the firm as specified in the board orientation.
The theory has ethical and managerial branch, which are used by the CTM .The ethical
branch of the stakeholders specifies that the board focus is on the needs of the stakeholder.
Most of the directors in this branch are independent that reflects the diversity of stakeholder.
The managerial branch of the stakeholder specifies that the board focus is to be motivated
and fulfil stakeholder needs, as they are powerful. In addition, key communication is used for
voluntary disclosures.
“Resources Dependency Theory”
This theory states that the firm must control the external resources in an efficient
manner. To maintain the links to the resources, the Board members play a significant role. In
addition, they add the value to the business by their skills and create their contacts with the
groups of educators, policymakers and lobbies (IGI Global , 2019).
In the case of CTM, it has constructed the matrix with their superb skills, experience
and knowledge. This helps in promoting the company in an effective direction and opens the
door for the searching resources. Hence, this theory is applicable to this company.
Company Communications Interpretation Though “Legitimacy Theory”
“Legitimacy theory” is the mechanism that promotes the company for implementation
and development of the environmental disclosure. The theory also suggests volunteering the
social aspects. This helps in fulfilling social contracts (Mousa & Hassan, 2014). This ensures
that the firm must be operated with the help of norms and bounds of the community and

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society. This theory supports the organisation to implement the rules and laws specified by
society. This theory has the idea, which is based on the social contract that secured the link
between the organisation and society.
In the organisation, Communication plays an important role in the corporate world
and helps in maintaining the professional structure in the corporation. It supports the
increment in the sales, retainment of the clients, following the strategies and branding for the
corporate. The company makes the design for the communication process. It helps in
revealing the meaning and the relationships of the cultural and natural heritage of the society,
which is known as interpretation. “Interpretation of company communication” is defined as
the combination of principles for communication.
Interpretation of corporate travel management limited communications has applied
legitimacy theory. In addition, they encourage the organisation for the constructive and open
communications that shows they are accessible. The company should treat employees with
fairness and equality. In addition, communication helps the company in maintaining the
relationships for longer durations with society. This is only possible if the organisation has
legitimated for the interest of society. Moreover, this legitimacy has promoted the capital and
other resources for the company. Therefore, this theory maintains communication between
external and internal individuals with the board.
Conclusion
From the above discussion, it can be said that the leading company of Australia, the
“Corporate Travel Management Ltd” has the effective corporate governance of the
organisation and it is listed in the “Australian Securities Exchange”. In this governance, the
company has applied various theories to be established in the firm out of which the most

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fitted theory for the organisation is “Agency Theory”. In addition, there is the corporate
governance with a number of policies adopted by the company.
The introduction and summarization of the “Corporate Travel Management Ltd” and
the description of the corporate governance at CTM in the above paragraphs is explained. In
addition, there is a detail of the board orientation along with the various theories. In this
report, the discussion is also on the remunerations committee of CTM, which has the
responsibilities for deciding the recommendations for the Board members of the company.
In addition, the company communication interpretation has applied the legitimacy
theory, which helps in understanding the importance of effective communication in the
“Corporate Management travel Ltd”.

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Bibliography
ASX. (2019, May 22). CTD. Retrieved from ASX: https://www.asx.com.au/asx/share-price-
research/company/CTD
CTM. (2019, May 22). Corporate Travel. Retrieved from CTM:
https://www.travelctm.com/what-we-do/corporate-travel/
CTM. (2019, May 22). Resource Management Travel. Retrieved from CTM:
https://www.travelctm.com/what-we-do/resource-travel/
CTM. (2019, May 22).Sports Travel Management. Retrieved from CTM:
https://www.travelctm.com/what-we-do/sport-travel/
CTM. (2018, August 22). 2018 Corporate Governance Statement. Retrieved from CTM:
https://www.travelctm.com/wp-content/uploads/2018/08/2018-08-22-2018-Corporate-
Governance-Statement.pdf
CTM. (2019, May 22). The CTM Story. Retrieved from CTM:
https://www.travelctm.com/who-we-are/services-heading/
ETM. (2019, May 22). Event Management Travel. Retrieved from ETM:
https://www.traveletm.com.au/
IGI Global. (2019, May 22). What is Resources Dependence Theory? Retrieved from IGI
Global: https://www.igi-global.com/dictionary/resources-dependence-theory/51655
Johansson, R. G. (2010). Management for sustainability – A stakeholder theory. Total
Quality Management & Business Excellence, 21(7), 737-744.
doi:10.1080/14783363.2010.483095

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Lopes, H. (2016). Agency theory and social interactions at work. Review of Social Economy,
74(4), 349-368. doi:10.1080/00346764.2016.1171381
Mousa, G. A., & Hassan, N. T. (2014, January). Legitimacy Theory and Environmental
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Economics Times: https://economictimes.indiatimes.com/money-you/what-is-
corporate-governance/articleshow/3995278.cms?from=mdr