Importance of Corporate Governance and Ethics in Peet Limited

This report discusses the importance of corporate governance and ethics in Peet Limited. It covers the board composition, reports from the chairman and CEO, remuneration report, and board orientation. The report also analyzes the application of stewardship theory in the company.

Running Head: MANAGEMENT 0
Peet Limited
Ethics and Governance
Report
Student Details

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Executive Summary
This report content is taken from various secondary sources, journals and websites.
This company’s Corporate Governance had been changed from the preceding years. Peet
Limited had Celebrated successful year on the “Australian Securities Exchange” since 2004
and had acquired its position in the ASX Index. In the preceding years, the company had
tremendous growth because of the ethics and governance states by the company. This is
because of the different ethical and governance outlook as compared to the other companies.
It had been observed that objective of PPC is following all ethical grounds and the
performance of the employees, as well as the direction of management, is considered
following social norms, religious practices and are influenced by cultural ethics. PPC
corporate governance and ethics encourages better communication, which helps in the
process of decision-making.
As the companies have effective corporate governance, so this company had been
included in one of the most of the companies of Real estate in Australia. Due to the previous
growth of this company, the Stakeholders attracts towards this company, as the Board
Orientations of this company is also presentable and effective. Hence, corporate governance
and ethics are acceptable by the Stakeholders.
Peet limited corporate governance & ethics objectives and aims are to consistently
understand and develop an approach to maintain standards of conduct and behaviour of the
Directors, consultants, employees, and officers in carrying out their roles.

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Contents
Introduction....................................................................................................................3
“Peet Limited”: Introduction and Summarization..........................................................3
Corporate Governance at “Peet Limited”......................................................................5
 Board Composition...........................................................................................6
Source: The Board of Directors of “Peet Limited” (Peed Limited , 2019)................6
Chairman Report........................................................................................................6
CEO Report................................................................................................................7
Remuneration Report.................................................................................................7
Board Orientation of “Peet Limited”.............................................................................8
Analyse of Board Orientation by applying “Stewardship theory”.............................8
Analyse of Board Orientation by applying “Resource Dependency theory”...........10
Interpretation of PPC communications using “Legitimacy Theory”...........................12
Conclusion....................................................................................................................13
Bibliography.................................................................................................................14

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Introduction
The Purpose of the Report is to understand the importance and role of Corporate
Governance and Ethics in the company named “Peet Limited”. In this Report, the Peet
Limited Company has been chosen to explain four parts, which help the reader to understand
the corporate governance, and ethics run in Peet Limited. In addition, this report is based on
the proper research on each part with the help of various secondary sources and some
important websites.
In this Report, the concept, research had been done for all the parts of the assignment.
The first part of the report will cover the introduction and summarization of the Peet limited,
which include the company’s ‘Code of Conduct & Ethics’, recent history, recent
achievements, missions and overview of the company’s industry. The second part will cover
the corporate governance at “Peet Limited”, which includes board composition, Report from
Chairperson and CEO, and Remuneration Report. The third part includes the Board
Orientation, explained with the help of “Stewardship Theory” and “Resources Dependency
theory”. In addition, the last part of the report will cover the Interpretation of the “Peet
Limited” communications using “Legitimacy Theory”.
The following paragraphs will help you to find out the essential outcomes of the
reports, which has been included in the conclusion part.
“Peet Limited”: Introduction and Summarization
The “Peet Limited” is one of the Australian leading company deals as residential
developers. They create master-planned communities, apartments and medium density
housing for the Australian homebuyers across the country. This company provides an ample

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number of opportunities for development partners, investors and consumers (Peet Limited ,
2019). The Objective of this company is to create and maintain the value of the company for
the longer duration and to have optimum returns for the shareholders of the PPC through
various strategies, innovative plans and quality acquisition which helps in companies
development. In addition, these objectives are specified as per the needs of the stakeholders,
which help in the sustainable growth of the company (Peet Limited , 2019).
James Peet founded this company, as he believed that the Australians have the right to
have the home and property of their own. Hence, he established this company in 1895. In
2004, this company is listed in the Australian Securities Exchange with the code name of
PPC (ASX, 2019). In recent years, the company has expanded and become the national
company and counted among the idolized companies in the property sector. Since 120 years,
the company is serving their stakeholders and shareholders with an appropriate vision,
effective leadership, great courage and with the proper integrity for the Property sector (Peet
Limited , 2019).
This company falls under the Property industry comprises the permanent fixtures and
trade of land across Australia. From the period of 1890 to 1990, it had been observed, that the
prize of properties in Australia continuously grew with 0.5% per year, after the inflation.
However, the faster rate of growth had been seen in this industry after 1990, which denotes
the sign of contracting economic bubble (Peet Limited , 2019).
This industry had to follow the “Australian Property Law” as it is the ethical duty of
the entire organisations in the property industry to follow this act. The government for the
property industry in Australia led down this act and the Australian company corporate
governance has to follow the rules and regulations of this law (Herbert Smith Freehills,
2019).

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This company corporate governance offers the consolation by providing transparency,
accountability, effective commercial system and robust project management. In addition, the
Board of this company includes highly qualified members with lots of experience in local,
national and international organisations (Peet Limited , 2019).
In Peet Limited, the risk management system helps in secure the assets of
stakeholders of the company. This system also helps in providing the oversights to do the
management in the various commercial arrangements on behalf of the company’s clients. In
addition, the company provides several projects, which involves thousands of people. This
had been done by maintaining a tremendous safety record. This company has the teams of the
managers who are only dedicated to the Work Health Safety and they ensure that the
company must follow the legislation, regulations and the policies (Peet Limited , 2019).
The Peet Limited performance is transparent in nature for their stakeholders. It had
been observed in the recent historical records that this company was always able to maintain
the promises and stick to its commitment. This company had various project agreements and
contracts, which are qualified, properly reviewed, measured and monitored on a regular basis.
Corporate Governance at “Peet Limited”
The corporate governance of “Peet Limited” states the policies and practices which
has to be followed by the organisation. This includes the management of many interests of a
corporation’s shareholders. It involves the rules and practices framework through, which
Board of Directors of “Peet Limited” fortifies the company accountability, transparency and
fairness in the relationship with the company’s stakeholders such as employees, financiers,
customers, government and communities. Peet Limited considered the framework of
corporate governance as per specified in Principles mentioned by the ASX Corporate

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Governance Council. The following points help to understand the corporate governance at
PPC (Peet Limited , 2019).
 Board Composition
The Board Composition of the PPC is comprised of five of Non-Executive Directors, from
which three of them are Independent Directors and one is Executive Directors (Peet Limited,
2019). The Board of Directors were assessed the Non-Executive Directors, which are
Independent. The appointment of the Board of Directors is based on the “ASXCGC
Recommendations” and had been reviewed on a regular basis (Peet Limited , 2019).
However, the Current Board Composition of Peet Limited is not meet up with the “ASXCGC
Recommendations”. The Board composition of PPC is described in the following table with
their Independent and Nondependent Ratio.
Sno. Name of the Director Details of the Directors designations
1. Mr Tony Lennon Non-executive Chairman (Non-Independent)
2. Mr Brendan Gore Managing Director and CEO (Non-Independent)
3. Mr Trevor Allen Director of the company (Independent)
4. Ms Vicki Krause Director of the company (Independent)
5. Mr Anthony Lennon Director of the company (Non-Independent)
6. Mr Bob McKinnon Non-Executive Director (Independent)
Source: The Board of Directors of “Peet Limited” (Peed Limited , 2019)

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Chairman Report
The Chairman of the “Peet Limited” had presented this report on the behalf of the
Board of Directors. This report is part of the Annual Report 2018 (Peet Limited , 2018). The
Chairman of this company states that the previous financial year had to go through the
variable condition of the market continuously across Australia in the Residential Property
Industry. The Chairman also specifies that the PPC had acquired and sustained the strongest
market position in the Australian Property sector. The better performance of this company
gave the employment growth in the organization. In addition, the business of this company
also increased demand for Confidence Lifted Property.
CEO Report
In the previous financial year 2018, the Chief Executive Director had presented the
report in the Annual Report of the company in 2018. This report states that the previous
financial year of Peet Group had shown a greater respond and the positive year for this
company helps in the upliftment of the company reputation (Peet Limited , 2018). In
addition, the CEO report also specifies that the geographically diversified “Land Bank” and
the portfolio of the product shows the solid Performance of the company with positive
results.
Remuneration Report
This is the part of “Remuneration Report”, which state that the remuneration of the
company is decided in accordance with the framework specified by the remuneration
committee. This report covers the service agreement of PPC and the details of the
remunerations (Peet Limited , 2019). In addition, the guidelines and the principles of PPC
which had been used by the company to determine the remuneration of the Board of

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Directors. Moreover, the compensation of the shareholders is mentioned and the other
additional information in perspective of the remuneration of the company is also mentioned
in this report (ASX, 2019).
Board Orientation of “Peet Limited”
Peet Limited’s board orientation is the process that helps the new directors, states the
contribution in the tenure and states their role to corporate governance and ethics in the board
(Peet Limited , 2019). The board orientations role is to provide important information about
the organisation. In addition, it specifies the rule and responsibility of the Board of directors
of PPC. In addition, it also serves to build an effective relationship among the PPC Board
members, which provides support and promotes the agreement about their work.
The corporate governance committee is responsible for the Board Orientations. The
Board Orientation program provides detail information about the company. The Board
orientation of the company can be analysed with the help of “Stewardship and Resource
Dependency Theory”, which is explained in the following paragraphs.
Analyse of Board Orientation by applying “Stewardship theory”
In “Stewardship theory”, the directors of the company motivated by the non-economic
activities such as doing a good job and being a corporation’s resources good steward
(Schillemans & Bjurstrøm, 2019, pp. 2-10).
“Peet Limited” governance strategies protect the shareholders and owners interest and
the Executive directors of the company had done this to secure their interest. The objective of
this company is to sustain and maintain a successful organization to prosper the shareholders
of the company. Hence, Stewardship theory is applicable in this firm. According to this
theory, the independent directors are not needed in the organisation as the executive directors

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and managers already motivated to do their actions, which are in favour of the organisation
(Johansson, 2010). Hence, there is a requirement to empower them instead of monitoring
their work. This theory helps in identifying, responding and understanding its stakeholder's
groups. The stakeholder's group includes customers, creditors, communities and employees,
where the corporation must attend all the needs of stakeholders in this theory. PPC constructs
the skilled report that shows that the board has the skills, experience and knowledge. This
helps in providing the corporation in an effective direction, which opens the door for the
searching resources for the corporation.
This company Board follows the principle of good corporate governance, where the
directors received the remuneration related to the performance. In addition, they receive the
other benefits of retirement or termination, except superannuation. The Board focus is to
provide a shareholder with the profits, dividend and growth. Remuneration provided to the
Directors and the Executives, mentioned in the remuneration report is in detail and this report
is the part of the director’s report. The key communications of this company specify the
Remuneration Report, Company Income Statement and Balance Sheet. To understand how
this theory is applicable in the organisation, here is the details explanation of “Peet Limited”
board composition, its focus and key communication.
 Board Composition of PPC
This theory is suitable for board composition of PPC as major directors are non-
independent here. They have the knowledge that how to run the company. In addition, they
know how to have growth in the company’s assets. The Stewardship theory helps in
maintaining the relationships between the Board and PPC Shareholders, which promotes and
sustains the trust of shareholders on the company and helps in building up the greater

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efficiency. In addition, the application of this theory concept provides benefits to those
people also who are connected with the “Peet Limited”.
 Board focus of PPC
The PPC board focus in this theory is to have internal growth in strategy and there is
an establishment of proper capital management. It helps the company to develop innovative
strategies, which is in favour of the Shareholder’s interest. In addition, it provides a
shareholder with the profits, dividend and growth. Remuneration provided to the Directors
and the Executives, mentioned in the remuneration report is in detail and this report is the
part of the director’s report. The focus of the PPC’s board in this theory based on the concept
of self-serving, which means they are themselves responsible for their activities in the
organisation for the further growth of the company.
 Key Communication of PPC
At the part of key communication, organisation Chairperson’s report has been
released in which the Balance Sheet and Cash Flow statement is represented. In PPC, mostly
directors are non-independent directors. The key communication of the company helps in
maintaining the coordination among the different groups in the organisation. It also gives
competitive advantages to the company. Hence, this theory is applicable in “Peet Limited”.
Analyse of Board Orientation by applying “Resource Dependency theory”
This theory is applicable in “Peet Limited” as this organisation have an appropriate
control on its external resources. To maintain and create the links to the resources, the BOD
of PPC plays an important role. The board members of the PPC add the value to the
organisation by their skills and maintain their contacts with the groups such as educators,

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policymakers and lobby groups. These group links help in reducing the uncertainty in future
of accessing the resources required in the organisation.
 Board Composition of PPC
In this Theory, the ratio of the independent or non-independent director in the board
composition is not so important. The most significant factors in this theory are a mix of
contacts and skills. In Peet Limited, the mix of skills and contacts ensures the flow of
vital resources.
 Board focus of PPC
The focus of the board in this theory is to the provider of the resources. In addition,
the board focus is on the capital and resources flow management, which enhances the
resources of the “Peet Limited”.
 Key Communication of PPC
The key composition is depending on the company, which means they serve to secure
the vital resources of the company. The key communication of the board helps the PPC to
create and maintain new contacts so that the company have further increment in the
resources.
Peet limited constructs the skilled matrix, this shows that the board has the skills,
experience and knowledge. This helps in providing the corporation in an effective direction,
which opens the door for the searching resources for the corporation. Hence, this theory is
applicable to this company.

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The above discussion helps in understanding the growth of strategies and capital
management in the company. Hence, “Stewardship theory” and “Resource Dependency
Theory” are applicable in Peet Limited’s corporate governance.
Interpretation of PPC communications using “Legitimacy Theory”
Legitimacy theory is the mechanism, which helps the “Peet Limited” in implementing
and developing environmental disclosure and volunteering the social aspects. In addition, it
also helps the PPC in securing assets of the company. This is done to fulfil the social
contracts of the company. This ensures that Peet Ltd must operate within the norms and
bounds of the respective community and society. This theory helps the organisation to follow
the rules and laws perceived by society. This theory is based on the idea of the social
contract, which establishes the link between the business and society.
Communication in the Property Industry plays an important as it helps the PPC in
maintaining the systematic structure of the organisation. It helps in increasing sales, retaining
the clients, implementation of strategies and corporate branding. The PPC has the designs of
the communication process to reveal the meaning and relationships of the social culture and
natural heritage is the interpretation of communication in this company. It involves the
objects, artefacts, sites and landscape of the business. Interpretation of PPC communication
means the combination of communication principles of this company. Every organisation has
its own interpreters. These interpreters should have the appropriate working knowledge.
Interpretation of PPC communications can be done by applied legitimacy theory in
the organisation. This encourages the company for constructive, candid and open
communications, which shows they are easily accessible. The company always try to treat the
employees and society with fairness and equality. In addition, their communication helps

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them in maintaining the trustful relationships with society and this is only possible if the
company is legitimated for social interest. Moreover, this social legitimacy in return provides
capital and other essential resources to the company. Therefore, legitimacy theory helps in
maintaining the communication between the board, external and internal individuals (Price,
2018). In addition, this theory states that the company should design a communication policy
to support communication with the shareholders and the stakeholders of the company.
Conclusion
From the above discussion, it can be concluded that the PPC have effective corporate
governance, which has been explained in the above paragraphs with the help of various
theories and concepts in the organisation. The theories can be applied to the are “Stewardship
theory” and “Resources Dependency Theory”. In addition, there is a number of policies of
corporate governance, which adopted by the company.
In the above paragraphs, there are the introduction and summary of the company,
which explains the company corporate governance. Moreover, there is a detail explanation of
the board orientation with the help of various theories. In this report, there is a discussion in
the above paragraphs, which shows the remunerations committee of “Peet Limited” has a
responsibility to make recommendations to the Board of the company.
In addition, the company communication interpretation by applying the legitimacy
theory, also explained in the above paragraphs, which helps in understanding the importance
of it in the company.

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Bibliography
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