Corporate Law BLO 2205 | Corporate Governance Of Ardent Leisure Ltd

Added on -2020-02-19

| BLO 2205| 14 pages| 2675 words| 31 views

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ARDENT ACTIVITIES2ContentsIntroduction......................................................................................................................................3Question (a).....................................................................................................................................3Question (b).....................................................................................................................................4Question (c).....................................................................................................................................6Question (d).....................................................................................................................................8Bibliography..................................................................................................................................11A.Articles/ Books/ Reports.....................................................................................................11B.Legislations.........................................................................................................................11C.Others..................................................................................................................................11
ARDENT ACTIVITIES3IntroductionOn October 25th, 2016, a fatal accident took place at the Dreamworld leisure park located on the Queensland Gold Coast, which resulted in the death of a number of patrons while riding atthe Dreamworld1. This leisure park was being operated by Ardent Leisure Ltd, which is listed on the Australian Stock Exchange2. As a result of this, the company was liable to follow the Corporate Governance Principles and Recommendations given by the ASX Corporate Governance Council. In particular, Principle 7, which relates to the risks being recognized and managed3. The accident revealed that this principle was not adhered properly and the management was at fault for this. In the following segments, a discussion has been carried out to specifically show the manner in which principles 7 was breached, the requisite actions which should have been taken by the Board, the failure of director duties and lastly, reviewing and improving upon the risk management framework of the company. The purpose of doing this is to present a comprehensive analysis of what should have been and what actually went down, along with the required future course of action. 1 Dana McCauley, Dreamworld parent company Ardent Leisure in crisis after fatal theme park accident (26 October2016) <http://www.news.com.au/finance/business/other-industries/dreamworld-parent-company-ardent-leisure-in-crisis-after-fatal-theme-park-accident/news-story/00c3d7a283c19e05427f273bb3a44e39>2Ardent Leisure,Corporate Governance (2017) <https://www.ardentleisure.com/about-us/corporate-governance/>3 ASX Corporate Governance Council, Corporate Governance Principles and Recommendations (2014) <http://www.asx.com.au/documents/asx-compliance/cgc-principles-and-recommendations-3rd-edn.pdf>
ARDENT ACTIVITIES4Question (a)Ardent Leisure Ltd, due to the reasons of being listed, publishes it adherence to the principles laid down by the ASX Corporate Governance Council for each year. Accordingly, they published this report, before the incident took place last, on 30th June 2016. The report clearly provides that a Safety, Sustainability & Environment Committee had been established formonitoring, reviewing, evaluating and making recommendations to the Board regarding the environment, occupational health and safety and sustainability. In this regard, it has been stated that the company works towards maintaining a safe environment for its employees and for the guests4. So, a policy was put in place by the company for managing and recognizing the risks.In a situation of crisis, the first step is to make contact with the victims and their families,particularly when the crisis results in a loss of life. As soon as the incident took place, the company, on the very same day, issued a statement regarding them being with the families and working closely with the emergency authorities5. However, a shocking revelation was made by the CEO of the company, Deborah Thomas, where she stated that the families of the victims had not been called as the company did not know how to contact them6. This shows a clear failure of the company in managing the risk which occurred. 4Ardent Leisure, Corporate Governance Statement (30 June 2016) <https://www.ardentleisure.com/wp-content/uploads/2017/01/Corporate-Governance-Statement-2016-FINAL.pdf>5 Saphora Smith, Dreamworld boss: 'We are deeply shocked and saddened' (25 October 2016) <https://www.standard.co.uk/news/world/dreamworld-boss-we-are-deeply-shocked-and-saddened-a3378021.html>6 David Beirman, Dreamworld owner Ardent Leisure needs a lesson in managing a crisis (28 October 2016) <https://theconversation.com/dreamworld-owner-ardent-leisure-needs-a-lesson-in-managing-a-crisis-6784>

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