Corporate Governance - Overview, Deployment

Running Head: CORPORATE GOVERNANCE
CORPORATE GOVERNANCE
Name of the Student
Name of the University
Author Note

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1. Key Arguments
It has been revealed that Credit Suisse, one of the leading financial service company
all across the globe has hired a corporate espionage company to follow the formal executive
Mr Iqbal khan. This has ruined the relations between Mr Thiam & Mr Rohner. The major
problem is related to crisis in the bank due to management failures in the financial sector.
FINMA regulators have advised to resign its leaders in such case. The issues has raised by
surveillance. The actual reason for the issue cannot be identified by simply doing the audit
process. The action which FINMA is going to start for the investigations is not compiled in
the law. The chairman of FINMA has found that loss of proper governance and inefficient
control in the financial company has resulted into certain issue in the Credit Suisse’s activity.
FINMA is unable to handle this corporate governance case due to political pressure. Hence,
the regulators are thinking that the Credit Suisse scandal and bank crisis is due to improper
management in the business. After the scandal, Mr Thiam has quite as CEO from Credit
Suisse. Then Thomas Gottstein Bio was replaced as the CEO of the financial company. The
company has issued shareholders to capitalise its business. But, there were many job cuts
after that khan has resigned from the company. Hence, from the investigations, the regulatory
body FINMA has worried to select a proper board of director as the CEO in Credit Suisse to
get committee to do a proper governance. The board director should govern the company by
following the rules and regulations that has been guided in the international standard. But,
most of the banks follows FINMA regulations is focused more on protecting more on largest
bank of Switzerland and to protect its corporate governance. For this they have to identify
any illegal wrongdoing in the business.
2. Importance for media

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It is important for media for doing investigations on such arguments because, media
will communicate all the information’s electronically to all the businesses and local
community of the country. Media will help the business to understand and evaluate whether
banks are acting appropriately and whether their business is secured by raising its funds from
this banks. The media will help the business to understand that the culture of the company is
ethical or not whether it is within its culture or not. It is also very important for the
shareholders to investigate in this case and to identify whether their investment is secured in
the business or not. Media will also help the Swiss prosecutors to search details on the
commodity traders and to identify whether there is any corruption involved in the trading or
not (Rickman, 2018). Media is interested in knowing the reason of this argument because
Credit Suisse is one of the largest financial company of the country and Mr Thiam & Mr
Khan is a popular board of director of the company (Francisco, 2018). Any argument
between these two directors will give the media channel to forecast the news and spread
popularity and income from the topic. Every businesses and normal people will be interested
in identifying the shrinking in their investment bank. The investor can identify the reason for
drop in the share price of the company (Kaymak & Bektas, 2017). People are also familiar
with the relation between Mr Khan and Mr Thiam and hence people will be interested in
knowing the reason behind their disturbance in relationship. Therefore, it is important for the
media to report on the arguments and broadcast their channels to public.
3. Corporate governance Issues
 Conflicts of Interest- This is the most important corporate governance issue found in
Credit Suisse Company. The relationship between Mr Thiam and Mr Khan has ruined
due to conflicts of Interest. Mr Khan had negotiated with the chairman Rohner to start
their own job in banking. This happened in the month of January when Khan has
stated an exit agreement with the chairman to start a new job from just after the three

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month. Mr Khan has helped the company in bringing new assets in 2016 and Mr
Thiam has repositioned the organisation as a wealth manager in 2015 (Filatotchev &
Wright, 2017). But, Mr Thiam was continuously promoted for his familiar work and
Mr Khan was frustrated with this and also with his profile in the business. He also did
not get a proper public appreciations. This has resulted into conflict between both of
them. This has raised into personal animosity between both of them (ArAs, 2016).
Hence, conflict of interest is one corporate governance interest found in the company
in which both the directors did not tried to resolve their issue and went against their
each other’s interest that has affected the objective of the company (Filatotchev,
Poulsen & Bell, 2019).
 Issues related to oversight of the company- This is another issue found in the
company. As the company stakes grew into a higher range. Mr Thiam role in the
business has caused issue in the role of the senior manager. The board is not engaged
in protecting the interest of their shareholders (Şahin, 2018). The shareholders said
that the CEO and chairman has gone against the company board awareness. This
means that the board of directors are not following the procedures & practices of the
company (Lebedeva et al., 2016). The board is not aware on the daily financial
operations of the company and the way the operations are done. Mr Khan had also
done no reference related to the business wealth management. It has also found that
Credit Suisse used to disagree any kind of legal orders from FINMA. This has caused
violation with the regulator agency FINMA and hence, the regulator body donot get
much attention to this issue. Therefore, FINMA was focused on protecting the largest
banks of Switzerland’s reputation in the banking industry, instead of protecting the
case of corporate issue case. This may cause a damage to the entire public and the
businesses related to these banks.

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 Transparency issue- It was found that the board of directors has not protected the
interest of their shareholders (Schipani, 2018). The shareholders has claimed the
decision of Mr Thiam to replace the passport of the company’s digital drive will be
replaced by financial services is not agreed by them. Swiss Investment advisor is
against this decision made by the Chief Executive Officer. This means that, the board
of director is against the interest of their shareholders. It was found that the
shareholders of Credit Suisse has also pressured the Chairman of the company to
support their chairman in spying the Credit Suisse scandal (Flammer, Hong & Minor,
2019). This means that the company donot have efficient transparency in their
business. This has damaged the relationship between the company directors and their
shareholders (Aguilera, Florackis & Kim 2016). They make decisions without taking
the interest of shareholders. This lack of transparency in the business system and also
has lack of transparency with the regulatory. This is another corporate governance in
the business.
4. Conclusion
Therefore, it can be concluded that, the corporate governance issues of the business
should be controlled by the board of directors. The issues are related to corporate governance
issues, Issues related to oversight of the company and Transparency issues. The most
important thing is that they should protect the interest of their investors for maintaining a
proper transparency in the system. They should properly do management and leaderships to
properly manage the business and improve the decisions. Mr Thiam was continuously
promoted for his familiar work and Mr Khan was frustrated with this and also with his profile
in the business. He also did not get a proper public appreciations. This has resulted into
conflict between both of them. This has raised into personal animosity between both of them.
The corporate governance issue of conflict of interest between Mr Khan and Mr Thiam. Now

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the CEO has resigned from his job and his departure from the company has ended the conflict
the interest with the new Chairman Rohner. Mr Khan had also done no reference related to
the business wealth management. It has also found that Credit Suisse used to disagree any
kind of legal orders from FINMA. The company should now protect this by creating
awareness within each and every individual of the company. The board of directors should
focus on protecting each other interest and following avoiding the conflict between them. The
company donot have efficient transparency in their business. This has damaged the
relationship between the company directors and their shareholders. This lack of transparency
in the business system and also has lack of transparency with the regulatory. This is another
corporate governance in the business. The company should allocate and segregate the duties
to each and every shareholders of the business. This will increase the oversight of the
business.

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References
Aguilera, R. V., Florackis, C., & Kim, H. (2016). Advancing the corporate governance
research agenda. Corporate Governance: An International Review, 24(3), 172-180.
ArAs, G. (2016). A handbook of corporate governance and social responsibility. CRC Press.
Filatotchev, I., & Wright, M. (2017). Methodological issues in governance research: An
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460.
Filatotchev, I., Poulsen, A., & Bell, R. G. (2019). Corporate governance of a multinational
enterprise: Firm, industry and institutional perspectives. Journal of Corporate
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Flammer, C., Hong, B., & Minor, D. (2019). Corporate governance and the rise of integrating
corporate social responsibility criteria in executive compensation: Effectiveness and
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Francisco, F. (2018). Examining the effectiveness of the Malawian Financial Intelligence
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Kaymak, T., & Bektas, E. (2017). Corporate social responsibility and governance:
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Lebedeva, T. E., Akhmetshin, E. M., Dzagoyeva, M. R., Kobersy, I. S., & Ikoev, S. K.
(2016). Corporate governance issues and control in conditions of unstable capital risk.
International Journal of Economics and Financial Issues, 6(1S), 25-32.
Rickman, G. (2018). Swiss Banks and Jewish Souls. Routledge.

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Şahin, A. (2018). How Principles of Business Ethics Relates to Corporate Governance and
Directors?. European Journal of Economics and Business Studies, 4(3), 22-27.
Schipani, C. A. (2018). The Role of Gender Diversity in Corporate Governance.