Hastie Group Research Report: Reasons for Collapse

This research report analyzes the reasons for the collapse of Hastie Group, a company that specialized in engineering. The report highlights the violation of corporate governance principles, poor financial management, and lack of effective leadership as the main reasons for the collapse. The research used both qualitative and quantitative research methods to obtain relevant data for the study. The findings show that $20 million fraud led to the downfall of Hastie construction firm. The collapse was the worst to have been experienced in history in the construction industry leaving many projects pending.

Running head :BUSINESS COMMUNICATION 1
UNIT NAME
STUDENT’S NAME
COURSE
UNIVERSITY NAME

2
HASTIE GROUP RESEARCH REPORT
EXECUTIVE SUMMARY
The purpose for this research was to determine circumstances that led to the failure of Hastie
group. The research method that was used to find out the reasons is the factual analysis method
where the operational principles were used as a measure of performance for Hastie group. Most
of the activities that were performed were against the outlined eight major principles of corporate
governance. It was found out that Hastie group collapsed as a result of lack of strategization of
its activities and misuse of funds by directors leading bankruptcy of the group. It was concluded
that the main factor that led to the collapse of Haste group was violation of the corporate
governance eight principles which determines the success or failure of a business corporation.
INTRODUCTION
When big companies collapse, many people who are employed and depend on the company end
up being unemployed (Association for Business Communication, Baruch College, & Department
of Speech. 2000). When they collapse many people are usually interested to know the reason like
Uchumi supermarket in Kenya and in our case Hastie group. The common factors that usually
lead to collapse of such corporations are issues such as: embezzlement of funds, poor leadership
style, lack of integrity hence senior most managers end up stealing from the company rendering
it bankrupt and the last but not least, failure to stick by the formulated policies that guide the
operation of such corporations. Hastie group had its headquarters in; New Zealand, the United
Kingdom Australia as well as in the Middle East. It specialized in; Rotary, plumbing, electrical
engineering and mechanical engineering. It had employed many people in many business

3
locations. There many assumptions of the reasons that might have led to its failure some of them
are; stiff competition in the market, lack of accountability with the finance reports, poor
reporting channels by those in leadership positions and violation of the corporate governance
principles.
METHODOLOGY
Both qualitative and quantitative research methods were used to obtain relevant data for the
study (Gopal, N. 2009). The research used questionnaires which were administered to the
students of several universities in Australia and their feedback on the same facilitated the
research findings and conclusions (Ketchen, D. J., & Bergh, D. D. 2004). The researcher also
interviewed a few of the former employees from the various regions who gave their views on the
circumstances that led to the dissolution of Hastie Group.
RESULTS AND FINDINGS
From the data collected the researcher found out that $20million fraud led to the downfall of
Hastie construction firm. It had employed 7000 workers, with 4000 in Australia. The collapse
was the worst to have been experienced in history in the construction industry leaving many
projects pending. It was found that the fraud was fueled by global economic turmoil. It was also
found that the company had many outstanding debts due to financed construction projects which
were in progress during the insolvency and had to sell its assets for compensation (Bovée, C. L.,

4
& Thill, J. V. 2018). It was also found that the employees’ salaries were postponed to a later date
which were not paid due to poor financial state that existed.
DISCUSSION /ANALYSIS
The research thorough analysis established that Hastie group collapsed as a result of the
following; the directors and officers poor management of the company, general lack of
transparency in finances, substandard project management systems and processes and lack of
effective communication with the customers. Embezzlement of funds was the major issue. From
the reasons outlined above, it is evident that the backbone for the success of any established
business is proper financial management and effective leadership style that ensures things work
in order.
CONCLUSION AND RECOMMENDATIONS
Proper financial management and high level of integrity are essential qualities for managers for
the success of the companies. Managers should ensure that those involved in organizational
transactions are directly accountable for any financial crisis for the better performance of the
company (Dulek, R. E. 1993).

5
References
Association for Business Communication, Baruch College, & Department of Speech.
(2000). Business communication quarterly. New York: Association for Business
Communication.
Bovée, C. L., & Thill, J. V. (2018). Business communication today.
Dulek, R. E. (1993). Models of Development: Business Schools and Business
Communication. Journal of Business Communication, 30(3), 315-331.
doi:10.1177/002194369303000305
Gopal, N. (2009). Business communication. New Delhi: New Age International.
Ketchen, D. J., & Bergh, D. D. (2004). Research methodology in strategy and management:
Volume 1. Amsterdam: Elsevier.
Overton, R. (2008). Business communication. Boat Harbour, N.S.W: Martin Books.
.