Corporate Governance & Social Responsibility Report: JB Hi-Fi Limited

CORPORATE GOVERNANCE REPORT 1
Corporate Governance & Social Responsibility Report: JB Hi-Fi Limited
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CORPORATE GOVERNANCE REPORT 2
Table of Contents
Introduction......................................................................................................................................3
Foundation for Management and Oversight....................................................................................3
Board Structure................................................................................................................................4
Ethics and Responsibilities..............................................................................................................5
Integrity in Corporate Reporting.....................................................................................................6
Timely and Balanced Disclosure.....................................................................................................7
Rights of Security Holders...............................................................................................................8
Risk Management Framework.........................................................................................................9
Fair Remuneration.........................................................................................................................10
Conclusion.....................................................................................................................................11
References......................................................................................................................................12
Appendix........................................................................................................................................13

CORPORATE GOVERNANCE REPORT 3
Corporate Governance & Social Responsibility: JB Hi-Fi Limited
Introduction
Corporate governance is among the aspects used to judge the efficiency of
organisations/corporations. It encompasses the framework of set regulations that define
relationships, system, and processes through which authority is exercised within
corporations/organisations. As aspects of management, corporate governance and social
responsibility are essential in creating investor confidence. Such confidence is crucial in ensuring
that the companies listed on the ASX compete fairly with others. Essentially, this report
highlights the eight basic principles of corporate governance with regards to JB Hi-Fi Solutions,
an entertainment retail based in Australia. It succinctly analyses the various aspects of ASX
corporate governance best practice principles, guidelines, and recommendations.
Foundation for Management and Oversight
As a requirement from ASX corporate governance council principles and
recommendations, all listed companies need to disclose the roles and responsibilities of the board
of management. This recommendations further requires the company to highlight how the
performance of the company is monitored and evaluated. Based on this requirements, JB Hi-Fi
Limited has a managed to conform to the requirements of ASX 2014 principles. In compliance
with this principle, the company makes its open in their annual reports the functions or roles the
board is tasked to undertake in running the operations of the company. According to the JB Hi-Fi
annual report (2016, p. 1), the company elaborates the responsibilities of the board including
protecting and enhancing shareholders’ value as well as monitoring the performance of the
company on behalf of them (shareholders). Furthermore, the board is tasked with evaluating

CORPORATE GOVERNANCE REPORT 4
executives and ensuring transparency is maintained in the company’s day-to-day activities (JB
Hi-Fi Limited 2016, p. 1).
Judging from the compliance level of JB Hi-Fi on ASX recommendations, it is clear that
the company’s corporate governance regime is strong with respect to the foundation for
management and oversight. This level of internal control is validated by the strength of the board
of directors of the company has on management, evaluation, and operations of the JB Hi-Fi
Limited. Essentially, corporate governance is said to be at its best when there is clear
demarcation of responsibilities between the executives and the board with regards to the
oversight of an organisation’s operations (Bose 2018, p. 106). This attribute has been attained by
JB Hi-Fi Solutions in its quest to comply with the ASX recommendations and underlying
principle of a solid foundation for management. Presumably, this might be the reason behind the
exemplary performance of the company in the retail industry that saw their sales go up by 8.3%
to reach $3,954.5 million in 2016 (JB Hi-Fi Limited 2016, p. 18).
Board Structure
The ASX recommendations are based on composition, size and skills and commitment of
the board of directors. Although there might be variations according to the size of the company,
it is essential for the members to be from different backgrounds, professions, and cultures for a
perfect blend to be obtained. JB Hi-Fi possesses an effective blend of expertise and professionals
in its board. The composition is meant to create value for the company based on its operational
strategies as well as vision. Particularly, the company has board members across different
professions including, finance, management, retail, risk evaluations, property, and governance
among others. Furthermore, the company has six directors who are mainly non-executives, thus
making the fit for oversight of the company (JB Hi-Fi Limited 2016, pp. 1-2). With five out of