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Corporate Governance and Legal Requirements- Project Report

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Added on  2019-11-26

Corporate Governance and Legal Requirements- Project Report

   Added on 2019-11-26

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Running Head: CORPORATE GOVERNANCE AND LEGAL REQUIREMENTS1Title: Corporate governance and legal requirementsName:Institution:
Corporate Governance and Legal Requirements- Project Report_1
Running Head: Corporate governance and legal requirements2The system of rules, practices and regulations through which a company is run havea huge impact in determining the success or failure of a business. Corporate governance involves a delicate balancing act, in which the interests of all stakeholders should be met satisfactorily. Through transparent corporate governance, industry best practice is promoted. However, bad governance results in situations where ethical conduct is not observed. At the same time, the firm’s reliability, integrity and ability to meet its obligations is severely compromised by negative governance by the stakeholders in charge of directly managing the business – the board of directors (Brickley, Smith & Zimmerman,2003). In the hospitality industry, the same concerns and aspects of governance are applicable. However, the industry has to grapple with additional concepts which tough on governance and the survival of the firm in a highly competitive industry. For instance, mergers and acquisitions are increasingly common in the business; companies try to exploit unique sources and capabilities possessed by their rivals. At the same time, franchising has also spread across the world, with more and more businesses opening franchises n places hitherto inaccessible to them (Mustapha, Ghazali & Muhamad, 2015). Corporate governance and organizational structureCorporate governance and how it succeeds depends on the organizational structure which the organization has chosen in to help manage itself. While there are several types oforganizational structure, it is ultimately upon the management to decide on their best structure to meet their objectives. At the same time, the management must realise the central role of a structure in implementing strategy. Corporate governance is dependent on organizational structure. This relationship is most apparent in the span of control that organizational structure gives the directors, and how it enables the organization to function in a way that helps meet the desires of other stakeholders. In the hospitality industry, and in
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Running Head: Corporate governance and legal requirements3the business I intend to start, the role of organizational structure will be critical. Issues involving efficiency and the implementation of strategy will determine the sort of structureto be adopted. In turn, this will have an effect on organizational culture, and governance practices (Paiva, Reis & Lourenco, 2016). In the organizational structure that I propose, my colleague and me will be at the top of the organizational structure. We will be directly responsible for a number of issues, including business management and support. Under us, there will be specific managers for finance, marketing, operations and human resource. The organization of the institution along these lines will be done in a way which injects efficiency into the organization, whileallowing for innovation and professionalism (Safari, Mirshekary & Wise, 2015). Survival and expansionOrganizations are initially concerned about their survival. As business goes on however, focus shift to long term expansion including entry into new markets and possessing of particular attributes which cannot be attained through organic growth. Through the whole process however, businesses must consistently ensure that they have the right governance principles on place. These principles should be aimed at promoting efficiency, ethics and stability (Lasisi, 2017). At the same time, corporate governance is critical in ensuring the confidence of other stakeholders. Hotels depend on the goodwill extended on them by other stakeholders to survive. For instance, suppliers are encouraged by a policy which takes care of their interests and business commitments. At the same time, shareholders are driven to invest more money if they are satisfied that the company will employ the best corporate governance practices in place (Omolade & Tony, 2014). As noted further by Omolade and Tony (2014), corporate governance has developed as direct reaction deficiency in ethics and sound management practices in organizations. Corporate governance is increasingly seen as an important way through
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