Ethics and Governance of Wagners Holding Company Limited

This report outlines the notion of ethics and corporate governance of Wagners Holding Company Limited, an Australian-based construction material provider. It discusses the company's ethical framework, corporate governance guidelines, board composition, and theories such as agency theory and stewardship theory. The report also highlights the company's achievements and its commitment to social responsibility.

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WAGNERS HOLDING COMPANY LIMITED
Ethics and governance

ETHICS & GOVERNANCE- WAGNERS HOLDING COMPANY LIMITED 1
Executive summary
This report will outline the notion of Ethics and corporate governance. In order to
understand the concept of ethics, this report includes the two level of analysis one is internal
concerns of the Wagners Holding company limited and emergent effects of the social norms and
stakeholders involvement.
Wagners limited is an Australian based company and operates as a holding company. The
company produces and sells construction material across the world. The company operates for
the tunnels airports, mining, gas plants, and dams’ projects. The report will provide the overall
summarization of the company and its ethical framework.
Contents

ETHICS & GOVERNANCE- WAGNERS HOLDING COMPANY LIMITED 2
Introduction......................................................................................................................................2
Wagners Holding Limited...............................................................................................................2
Summarization of the company...................................................................................................2
Corporate governance of Wagners...............................................................................................4
Board orientation and Theories....................................................................................................6
Communication with stakeholders and legitimacy theory...........................................................9
Conclusion.....................................................................................................................................11
Bibliography..................................................................................................................................12

ETHICS & GOVERNANCE- WAGNERS HOLDING COMPANY LIMITED 3
Introduction
There is many philosophies with the different views have been provided for business
ethics. But with the simple definition of business ethics and governance is to operate with ethical
judgment and business activities (Kumar, 2016). Business ethics refers to the company’s code of
conduct that guides leaders and employee of the company to deal with the conflicts and society.
It manages issues in regards to the good and moral rights, obligations and corporate
administration between an organization and its investors, representatives, clients, media,
government, providers and sellers (Ferrell, 2016).
The purpose of the report is to assess the Ethics and corporate governance of Wagners
Holding Limited. It will also outline the theories of corporate governance such as agency theory
stewardship theory stakeholder’s managerial branch, ethical branch, and resource theory. The
report overall serves the knowledge of how an organization needs to manage its operation with
the social norms and meet the expectation of the stakeholders.
Wagners Holding Limited
Summarization of the company
Wagners is the largest construction material provider based in Australia. The company
works for 30 years. Wagners holding limited organized in 1989 in Toowoomba, Queensland.
Later in 1991 the company developed with Malu Quarry and become self-dependent for their
aggregate needs of services its concrete division. In 1992 the company expanded its business
with the concrete supply to Wyalla in Texas Queensland.

ETHICS & GOVERNANCE- WAGNERS HOLDING COMPANY LIMITED 4
Later in 1994 Wagners purchase a site and establish headquarter in Alderley Street in
Toowoomba. The year 1999 and 2001 was a successful year of the company as Wagner
purchased Dalby, Chinchilla, Miles, Tara plants and expanded its concrete productivity and apart
from that the company also exquisite 31-hectare sites. And in the year of 2011 the company
awarded by the Premiers Climate Smart Sustainability Awards for Innovation in Climate Smart
Technologies for Earth Friendly Concrete (Wagners, 2018).
The company basically operates in the Construction industry. Construction material
industry is an established industry. This industry consists of many industries such as mining,
quarrying and Raw Material Production Company and these materials can be concrete, cement,
clay, and marble. And Wagners use to produce all the material. The company expanded its
business on the largest level (Bloomberg, 2018).
Currently, the company operates with two sector construction material and building
material. Its construction material includes mix concrete, flyash, aggregate; precast concrete
products also reinforcing steel and its new building material include fiber technology and
environment-friendly concrete. Apart from that the company also provides logistics and transport
services (Bloomberg , 2018).
Its revenue from construction material is around 216.3 million and 29.1mn from building
materials. The company is listed in ASX in 2017. The company works with its guiding principles
and serves social responsibilities. Its principles “IT’S FAIR” introduces its strategy I stands for
Integrity, T the company works together, with S Work in a safe environment F stands for being
family conscious, with A encourage and acknowledge success, I for Foster innovation and R

ETHICS & GOVERNANCE- WAGNERS HOLDING COMPANY LIMITED 5
stand for Require quality and excellence. Its Fair guidelines aligned with the company’s
business strategy and the company operates within these guidelines (Wagners, 2018).
Corporate governance of Wagners
The company reviewed and applies ASX’s guidelines with its corporate governance
guidelines. According to corporation Act 2001 of the company, every staff member has to follow
and works in terms of its guidelines and rules (ASX, 2019).
Board composition and the ratio of independent and non-independent director of the
company
With the board composition of the company, there should be at least 4 directors and 50%
of them should be non-executives directors. They should have many years of experience and
should be expert and skilled people and these have to be relevant to the group’s business. Also,
there can be more than 4 directors only when if the board of the company identifies that there is a
need for additional director in some particular area or when outstanding candidates in identified.
The overall majority of the directors are independent (Wagners, 2018).
The Board of the company also reviews and assess that each member of the board
ensures the independent with the interest disclosed by them. A chairperson only can be
independent when they are not in contact with any interest or relation that may influence also
each director has to provide evidence report about all such situations and issues. In the annual
report, each director’s independence has to be disclosed. Also if any of the board directors is
bounded to be the independent director the company has to be revealed amongst the society.
According to the corporate governance report of Wagners, the chairman of the company
is an independent director and is responsible to facilitate the contribution by other directors also

ETHICS & GOVERNANCE- WAGNERS HOLDING COMPANY LIMITED 6
create establish better relationship amongst board members and senior management. However, if
Wagner’s chairman is not independent, e board appoint deputy chairman who can work with the
chairman (Wagners, 2018).
Report from the Chairperson and CEO
In the report, the chairman of the company states that the company successfully took the
step of accepting social norms and listed in ASX. And this step would be beneficial for the
company’s stakeholders and for the business strategy. Dennis Wagner the chairman of the
company also states that the company spends 2 hours in the every board meeting and involves
every member of the different team and discusses the safety, environment, and quality of the
material. According to business results of the year 2018, the company forecast solid business
growth in the coming years.
However in the year 2018 the company faced several challenges such as delay in big
projects yet this was a successful year for the company’s transport business has benefited from
the upturn in the mining sector. The new segment, New Generation Building Materials services
brings high growth in the future and finds many opportunities in NZ Australia and the US as the
company recently awarded for its project in Florida.
In the report, CEO added some highlights of the company’s achievements. One of the
achievements was that the company has performed well, achieving pro forma EBITDA of $50.3
million. He also states that the company works ethically and maintains a better relationship with
its stakeholders and ensures the safety of all the employees (Wagners, 2018).

ETHICS & GOVERNANCE- WAGNERS HOLDING COMPANY LIMITED 7
The Remuneration report
For the remunerate employee there is remuneration committee that review the
performance of the employees and also review the recommendation for better remuneration
policies and framework.
Remuneration involved some benefits included all the monetary and non-monetary payment and
benefits such as:
 Retirement benefits
 Fringe benefits
 Insurance benefits
 Equity participants and extra incentives policies
In overall with the guiding principles each director of the board is responsible to act within
the guiding principles if ASX and the company’s constitution. They are responsible to maintain
an ethical and safe work environment (Wagners, 2018).
Board orientation and Theories
Board orientation is the process where a company provides all the information about the
board members their roles and responsibilities, also provide disclosure report about the board
members to the stakeholders of the company and society (MACDONALD, 2018). There are
many theories which underlying the concept and can be implemented in order to understand the
board orientation of the company.
Agency theory assesses the principles and agent’s relationship, in contrast with the
stewardship theory, executives of the company protects the interest of company’s owner and
other shareholders take some responsibilities, also make some decision on their behalf. In a

ETHICS & GOVERNANCE- WAGNERS HOLDING COMPANY LIMITED 8
director relationship, two gatherings exist – the operator and foremost, whereby the previous
demonstrations and takes choices for the benefit of the last mentioned. The hypothesis spins
around the connection between the two and the issues that may surface because of their diverse
hazard points of view and business objectives (Hussain, 2018). While stewardship theory’s main
purpose is to sustain a successful company and its priorities are the goals of the organization
(Bauweraerts, 2017). When it comes to similarities with agency and stewardship both focus on
the company’s shareholders engagement while decision making. Their intention is to manage all
the shareholder's expectations by providing disclosure of all the information related to the
financial health of the company. Providing disclosure of all the information of the company is
essential aspect and principle of corporate governance. And every company has to follow the
procedures. Wagner also has disclosure policy, with this policy Wagners has to comply with
continues disclosure according to the section 674 Corporation Act (Wagners, 2018). Overall
agency theory can be implemented while the majority of board members are independent and
stewardship board members are mostly non-independent.
Apart from Agency and Stewardship, there are two other theories of stakeholder’s
managerial branch and ethical branch theory. The managerial theory also can be implemented
while Wagners has a majority of independent board directors. As all stakeholder are not having
equal rights, some of them are most powerful than other stakeholders. The managerial board
probably works to satisfy powerful stakeholders of the company. These stakeholders can be
different for different companies at different times. With Ethical branch theory stakeholders
there are also mostly independent directors; replicate the diversity of all-powerful stakeholders.
The managerial board focuses on forecasting the needs of powerful stakeholders. The
information provided by the board to these powerful stakeholders can vary according to their

ETHICS & GOVERNANCE- WAGNERS HOLDING COMPANY LIMITED 9
interest. But the board has to make a strategy to manage such conflicts and issues. Therefore
managerial board mostly working for the interest of the powerful stakeholders and manage the
conflicts.
The ethical board focuses on the management of all the stakeholder of the company.
Utilizing the moral part of partner hypothesis, we see the enterprise and its board as a planning
vehicle for the interests of its partners. The board and its administration have a guardian duty to
all partners and not simply to investors. Where irreconcilable situations emerge among partners
or partner gatherings, the board needs to oversee and adjust its commitments for more notes
worthy’s benefit of the partners. Notwithstanding, the board additionally perceives that it has an
obligation to give satisfactory and reasonable exposures to all partners (deontology), regardless
of whether that data is utilized or not.
At last with the Resource theory, this is not important to have an equal ratio of
independent and non-independent board directors. But the thing which is important that there is
should be all kind of skilled people who can handle the resource flows into the company and
manage the operations in order to achieve the organization’s success. The resource flows
contains both internal and external flow of resource. Board also manage the capital of the
company provides the required resource to the other staff.
Agency theory can be implemented with Wagners' board composition as the majority of
directors are independent. According to the corporate governance report the Wagners there
should not be more than three directors and half of them have to non-executive directors and the
majority of directors should be independent. The board of the company focuses on the
shareholders needs their growth and dividends as well. Company’s shareholders are the owners

ETHICS & GOVERNANCE- WAGNERS HOLDING COMPANY LIMITED 10
of the company and pick executive to make a decision on their behalf. Wagners has to
communicate with the shareholders time to time and communication includes continuous
disclosure obligations should be a standing item on the agenda for each regular Board meeting.
Directors must promptly give details of any matter within their knowledge that might require
disclosure to the market under the continuous disclosure obligations. Board directors have to
provide remuneration report, income statement and balance sheet and annual report to
shareholders. The annual report must contain information about how all the operations
completed during the year what were the changes have been made and required to be done also
overall details that what are the future plans and what will company going to do to achieve the
plans. Also with these disclosures Wagners aims to ensure that all stakeholders are timely
informed about the changes and developments and also facilitate the effective communication
with all the partners and investors in order to maintain a better understanding of its business and
corporate governance and its performance. There are some key communication of agency theory
and Wagners Ltd:
 Encourage full participation of shareholders in AGM
 Ensuring all the auditors is available to answer the queries of shareholders
 Provide all the details of the new announcements, so that investors and shareholders can
pursue more information.
 Submit the written answer to the questions of the shareholders in the conducted general
meetings and AGM (Wagners, 2018).
Also, the company shows that it is working for the interest of powerful shareholders as they have
committees to review and remunerate the performance and manage the risk and compliance
committee evaluate all the reports and provides assurance. Hence it can be said that the Agency

ETHICS & GOVERNANCE- WAGNERS HOLDING COMPANY LIMITED 11
theory can be implemented appropriately with the procedure of the board orientation of the
Wagners.
Communication with stakeholders and legitimacy theory
Every company has to maintain a safe and ethical work environment and has to be
transparent about what the company is doing and how it operating within the social norms. In
order to fulfill these, originations have to provide disclosure about how they are fulfilling
society’s expectations and social contracts (Milne, 2002).
Legitimacy theory is a concept of understanding how an organization fulfilling the social
policies and norms. If any organization is working with social norms and guidelines properly that
would be called as legitimate (Deegan, 2002). Wagners works with its guiding principles as the
company states with its code of conduct and ensures that its directors work with guiding
principles and perform their duties and responsibilities with the obligation and implement its
corporate governance practices.
Social norms change according to time, in the recent year according to some changes the
society wants transparency about how the company provides a work environment and address
other social issues. If any organization found to be guilty with any illegal terms and make any
conflicts the society cannot be legitimacy and that will be difficult for the company to make sales
and achieve success.
With Wagners, all the employees of the company have to work with integrity and
improve the performance of the company. They should work within the guidelines with the
proper purpose. Directors have to avoid and report about any conflict of the interest issue and
should not take any advantage of their position also should share any internal information of the

ETHICS & GOVERNANCE- WAGNERS HOLDING COMPANY LIMITED 12
company with the outsider. If any director found to be guilty with any breaches of laws and
principles of the company they would be fined or disqualified from the company. Chiefs should
consistently agree to the soul just as the stated aim of the law and with the standards of this code.
According to Legitimacy theory, all the companies have to provide disclosure to the
stakeholder and society if it operates with the social norms. Companies have to disclose what
they are doing to be legitimate and operate with an ethical framework. These disclosures can be
made by annual report code of conduct and companies website (Zürn, 2018). Wagner fulfills the
responsibility of being legitimate as the company provides corporate governance report and
annual report as its yearly disclosures. In the corporate governance report, the company provided
information about their policies. The company has made three committees Audit and Risk
Management Committee » Remuneration Committee » Nomination Committee. These
committees review such issues to manage and provide recommendations in relation to change the
policies (Wagners, 2018). The company provides disclose information through its corporate
governance statement and code of conducts statement which includes all the method of board
orientation and policies and compliance rules. Apart from that the company also has some
policies such as anti-bribery and anti-corruption policy, Security and trading policies, diversity
policy, whistle blower policy and many others policy. And it can be said that the Wagners
successfully meeting the target of being legitimate and earn profit from that.

ETHICS & GOVERNANCE- WAGNERS HOLDING COMPANY LIMITED 13
Conclusion
It can be concluded that Ethics and governance are two important aspects to keep with
business operations. Wagner is an Australian based organization and listed in ASX. The
company has 6 board directors and the majority of them are a non-executive and independent
director. The chairman Dennis Wagner is the independent director. Agency theory can be
implemented with the board orientation of the company. However, stakeholder’s Managerial
theory can also be implemented as the board focuses on voluntary disclosure. Yet Board works
in order to meet the expectation of the shareholders of the company and provide all the
information to them, also fulfill the social requirement by being legitimate.

ETHICS & GOVERNANCE- WAGNERS HOLDING COMPANY LIMITED 14
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