Corporate Governance of Suncor Energy Private Limited

This paper analyzes the corporate governance structure of Suncor Energy Private Limited, focusing on ethical, legal, and regulatory compliance, as well as risk management. The findings indicate that Suncor is compliant and has effective risk management techniques in place.

Running head: CORPORATE GOVERNANCE 1
Corporate Governance
Student’s Name
University’s Name

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Abstract
This particular paper focuses on the governance structure of Suncor Energy Private Limited
that is one of the largest petroleum companies of the world. In order to analyze the corporate
governance structure of Suncor, the focus was on the ethical compliance, legal compliance
and regulatory compliance along with the risk management of the company. In a highly
turbulent and dynamic business environment, it is essential for companies to operate in such a
way that they are ethically, legally and regulatory compliant along with effectively managing
the future risks that can have catastrophic impacts on the performance of the organization. In
this context, the major objective of this paper was to analyze the corporate governance of
Suncor. The findings of the study indicate that Suncor is ethically, legally and regulatory
compliant with the help of a number of policies and programs along with the stewardship. It
ensures that the company does not violate any of the regulation that has a negative impact on
the employees and the community that it is serving. The risk management analysis of Suncor
indicates that the primary risks of the company include the risk of reputation, risk of
regulations, risk of health & safety, risk of financial impact along with the environmental
risks. Suncor has effective techniques and processes that help in managing the primary risks
along with anticipating the future risks.
Keywords - Corporate governance, legal compliance, regulatory compliance, ethical
compliance and risk management

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Contents
Abstract......................................................................................................................................2
Introduction................................................................................................................................4
Conceptual Framework..............................................................................................................4
Key Measures/Indicators of Legal Compliance.........................................................................4
KeyMeasures/ Indicators for Ethical Behaviour........................................................................6
What are the key measures/ indicators of regulatory compliance..............................................7
Primary areas of risk and how are they minimized....................................................................8
Summary and Conclusion........................................................................................................10
References................................................................................................................................11

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Introduction
This particular paper focuses on the legal, ethical and regulatory compliances of
Suncor Energy Private Limited along with its risk management structure. In this context, the
secondary data collected from the annual reports of the Suncor will be used. Suncor is a
pioneer in the development of oil sands of Canada along with being the largest petroleum
resource basins of the world. (Suncor, 2018). The figure below shows the conceptual
framework of the study that includes the ethical compliance, legal compliance and regulatory
compliance along with the risk management of the company.
Conceptual Framework
Conceptual Framework
Key Measures/Indicators of Legal Compliance
Every organization has certain regulations, rules and agreements that need to be
adhered. Sun Core Energy also has some rules and regulations that help it in ensuring the
appropriateness and soundness of the overall system (Holcomb, 2016). In this context some
of the indicators that can be used to measure the legal compliance performance include
employee relations, public relations, and number of legal disputes in the organization. The
legal compliances help in improving the relationship between the company, employees and
Corporate
Governance
Legal
Compliance
Regulatory
Compliance
Ethical
Compliance
Risk
Management

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customers (Geddes, 2017). This also helps in building and managing the reputation of the
company. In order to identify and ensure the compliance Suncor focuses on the following:
Exercising Stewardship of the codes by the Board of Directors: In this context, Suncor makes
it important for its board of Directors to supervise and take control of the process of legal
compliance. Suncor also focuses on conducting the internal audits and the affirmation
processes annually. Further in order to ensure the legal compliances Suncor also ensures that
the audit committee of the organizations offer the reports on compliance to the management.
In addition, Suncor also encourages its employees to support the process of legal
investigation even if the results are some legal liability.
In order to ensure the future legal requirements Suncor focuses on the following:
Suncor meets with the divisional leaders so as to ensure that all the policies for legal
companies are feasible and effective. The divisional leaders also provide important
recommendations that can help in ensuring a legal compliance in the organization.
In order to determine the future legal requirements Suncor focuses on the process of
collective decision making. Under this process managers and employees from all the levels
and functions are encouraged to provide their views and recommendations regarding the
ways in which legal compliance can be ensured (Adelstein & Clegg, 2015).
The overall legal compliance structure of Suncor indicates that in order to follow all
the legal compliances along with the future challenges associated with same Suncor involves
its employees and managers in the process. In addition, the regular audits and checks also one
of the major contributors in the legal compliance of Suncor. Suncor also ensures that the
employees from all the levels in the organization have a good understanding of legal
requirements (Suncor Energy, 2018).

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KeyMeasures/ Indicators for Ethical Behaviour
The ethical behaviour at the workplace can be defined as the moral code that guides
the employees towards an ethical behaviour and conduct. Suncor in this context focuses on
articulating the commitment to ethical and legal practices with the help of its business
policies (Babayanju, Animasaun, & Sanyaolu, 2017).The Company has a standard of
Business Conduct Code that is comprised of policy guidance and a code compliance program.
Some of the important ethical indicators that are used by Suncor to measure its ethical
performance include the following – environmental protection measures, contribution to
committee and ethical performance at the workplace. The commitment to ethics and integrity
is a foundation for the Standards of Business Conduct Code. In addition, Suncor also focuses
on measuring the ethical performance of the company (Vallabh & Dadhich, 2016). The
company focuses on ensuring an ethical behaviour will? all of its internal and external
stakeholders by ensuring that there is no element of corruption in the transactions.
Suncor believes that corruption constrains the sustainable performance of the
company. For this Suncor ensures that the facilities and funds of the organization are not used
for an illegal purpose, there are no payments or bribery for an unlawful acts and the
employees are also required to follow all the rules and regulations regarding the proper
payments to the third parties and officials. In addition Suncor also focuses on training of its
employees for the prevention of improper transactions and payments along with an anti-
corruption training. The above discussed ethical measures and steps help Suncor in ensuring
the ethical compliances. (Suncor Energy, 2018)
Apart from the ethical compliances for a corruption free organization, Suncor also
focuses on the training and development of managers and executives under standards of
Business code of conduct. Under this program the officers, employees and directors take an
annual training course so as to ensure that they understand all the requirements related to the

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ethical code, they have reviewed the code of summary and have also resolved the non
compliance code. The overall structure and procedures of Suncor regarding the ethical
compliance indicates that the company is critically focusing on the ethical behaviour but it
needs to be prepared for the future ethical challenges especially in context of environment
protection (Weller, 2017).
What are the key measures/ indicators of regulatory compliance
Regulatory compliance can be defined as the organization’s adherence to regulations,
law, specifications and guidelines particularly that are relevant to the business process of
organization. If regulatory compliances are violated then the result can be a legal
punishment. Suncor in order to ensure the regulatory compliances has some specific
requirements and standards that help in building an excellence (Akhigbe, Amyot, & Richards,
2016). The number of regulations has significantly increased because of the dynamic
business environment. Suncor has corporate, regulatory and chief regulatory officers along
with other managerial positions related to compliance. The Board of Director of Suncor
ensures that the company remains regulatory complaint. Some of the important indicators for
regulatory compliance at Suncor are - Safety, health, environment and security. In order to
ensure compliance with current regulatory requirements and anticipate and prepare for future
regulatory requirements Suncor focuses on the following:
Suncor has appointed a Board for the health, safety and sustainable development also
known as the EHS &SD committee that is responsible for monitoring the performance of
management under the mandates of Environment, Health, Safety and Sustainable
Development. The Board also offer their recommendations regarding the mandates that can
be used for managing the future health & Safety environment. Further, the management
stewardship reports are other major contributors in ensuring the regulatory compliances

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(Akhigbe, Amyot, & Richards, 2016). The health, safety and environment investigation
audits and reviews help in ensuring the existing regulatory compliance along with
anticipating the future challenges that can raise an issue related to regulatory incompliance.
Suncor also focuses on creating and revising the skill matrix so as to ensure that organization
has relevant skills, abilities and experiences regarding the health, safety, environment and
security of the organization. In order to ensure the regulatory compliances Suncor also
focuses on other steps and initiatives such as implementing the initiatives for reducing the
number of injury frequency in the organization along with promoting the participation and
dialogues in the process ensuring the regulatory compliance. Suncor also has some of the
procedures at place especially for securing the site access along with ensuring that who is
working on the Suncor’s sites. The overall discussion on the regulatory compliance of Suncor
indicates that the company is adhering to the regulatory compliances along with finding new
ways that can help it in managing the future challenges related to regulatory compliance.
(Yee, Tang, & Lo, 2014).
Primary areas of risk and how are they minimized
Organizational risk can be defined as the potential loss that can occur because of
uncertainty. The organizational risks if not managed effectively can have catastrophic
impacts on the overall performance of the organization (Iacob, 2014). Therefore Suncor
believes that risk management is one of its major priorities in context of achieving the
organizational goals and objectives. For this purpose organization also focuses on ensuring a
culture of operational discipline. Under the culture of operational discipline all the employees
are required to maintain discipline standards in all their activities and promotion. Some of the
primary areas of risk for Suncor include following – risk of reputation, risk of regulations,
risk of health & Safety, risk of financial impact along with the environmental risks. Suncor

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considers these risks as the principle risks that are potential enough to materially affect
company’s ability to support its business strategy and achieve the goals and objectives
(Jovanović, Milijić, Dimitrova, & Mihajlović, 2016). In a constantly evolving and dynamic
environment Suncor uses it’s critical and principle risks processes that can help in
minimizing the future principle risks. In order to minimize the future risks Suncor focuses on
making the risk informed decisions along with reflecting the triple bottom line
responsibilities. In this context, company focuses on on-going risk identification, assessment,
mitigation and monitoring of the risks that are inherent to operations, activities and assets of
the organization (Suncor Energy, 2018). The risk management program of Suncor is also
aligned to the ISO 31000 Risk management – Guidelines (International Organization for
Standardization guidelines). These guidelines are also adopted by the Council of Canada that
also helps in providing a framework and principles regarding the process of risk management.
In addition in order to minimize the primary risks of the organization Suncor focuses on
engaging with the Enterprise Risk Management (ERM) program at all the levels of
organization such as the audit committee and Board of Directors. These committees are also
responsible for over sighting the principle risks along with ensuring that that system are at
their place for regularly indentifying and mitigating the critical risks in the business area.
Suncor also focuses on minimizing the primary risks with the help of risk coordinators that
are embedded in each business area and play an instrumental role in context of supporting the
important risk processes and building awareness in the organization regarding the
stewardship of risks and proper accountability of risks (Aven, 2015).

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Summary and Conclusion
The above paper has focused on the ways in which Suncor manages the ethical, legal,
and regulatory compliance along with assessing and mitigating the primary risks of the
company. In order to ensure the compliances, company focuses on involving employees and
managers from different levels of the organization and encouraging them to provide their
valuable suggestions regarding the ways in which compliances can be ensured in the
organization. The stewardship committees of Suncor play a crucial role in ensuring the
compliances in coordination with the audit companies. The primary risks of Suncor - risk of
reputation, risk of regulations, risk of health & safety, risk of financial impact along with the
environmental risks are managed with the help of risk management guidelines and Enterprise
Risk management program. In essence, it can be indicated that Suncor is focusing on all the
possible steps that can be taken for been compliant, however, future challenges of business
environment may pose some challenges.
References

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