To analyse the issue of corporate governance that affects the functioning of an organisation. A case study on Volkswagen.

Research Project

Table of Contents
INTRODUCTION...........................................................................................................................1
Research aim...............................................................................................................................1
Research objectives.....................................................................................................................1
Research question........................................................................................................................1
Background of organization........................................................................................................2
LITERARTURE REVIEW..............................................................................................................2
Concept of corporate governance................................................................................................2
Issue faced by Volkswagen due to corporate governance..........................................................4
Impact of corporate governance over the functioning of Volkswagen.......................................5
DISCUSSION OF THE SECONDARY AND PRIMARY RESARCH ........................................6
CRITICAL REVIEW OF THE RESULTS OF THE RESEARCH................................................7
RECOMMENDATIONS AND ACTION PLAN .........................................................................11
REFERENCES..............................................................................................................................13
.......................................................................................................................................................14

Title: To analyse the issue of corporate governance that affects the functioning of an
organisation. A case study on Volkswagen.
INTRODUCTION
Corporate governance is refers to the collection of processes and relation by which
business are operate, regulate and controlled. Mainly, the encompasses the external factors that
directly affect the interests of shareholders such as suppliers, government regulation, customers
and many more of business organisation. In this regards, the board of director is responsible for
creating the whole framework for corporate governance that best line up business along with its
objectives. Along with this, the main purpose of corporate governance is to evaluate
entrepreneurial and prudent management that help in delivering long term success of business
organisation (Head and Alford, 2015). As it is consider as a system by which companies are
directly controlled and directed. It also affect the entire functions and operational activities of
company. Good corporate governance includes set of rules that determine the positive relation
between management, stakeholders and the board of directors of business and at the same time
also influence how a firm is operating their activities. One of the main objectives of corporate
governance is to increase value of shareholders and also protect their interests that assist in
enhancing positive brand image of company at market place.
Research aim
“To analyse the issue of corporate governance that affects the functioning of an organisation.” A
case study on Volkswagen
Research objectives
 To understand the concept of corporate governance.
 To identify the issue faced by Volkswagen due to corporate governance.
 To identify impact of corporate governance over the functioning of Volkswagen.
Research question
 What is the concept of corporate governance?
 What ate the issues faced by Volkswagen due to corporate governance?
 What is the impact of corporate governance over the functioning of Volkswagen?
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Background of organization
Volkswagen is a famous German auto-maker company operate their business in over the
world. It was founded in 1937 by the German Labour Front and its headquartered in Wolfsburg.
It sales their services worldwide with the aim of increasing their market share. The biggest
market of this company is in China which serve around 40% of its sales and profitability. In this
context, corporate governance is stands for responsible, transparent corporate management that
aims to add by long term value. As an effective and good corporate governance is not only based
on lasting corporate success but also a key aspect for strengthening the trust of their shareholders
like customers, business partners, employees and business partners and its financial markets
(Slack and Brandon-Jones, 2018). If company follow good corporate governance that each and
every shareholder treated equally and fairly as it is making sure that shareholder are aware of
their rights within and also know how to exercise them. Furthermore, board of directors also
maintain commitment to ensure about accountability, fairness, transparency within the corporate
governance.
LITERARTURE REVIEW
It is one of the important section of research as it provide depth information about the
topic that may assist in providing a path and direction to investigator with the aim of attaining
positive and reliable results. Mainly, it is a part of secondary method that is based on published
material on different sites such as books, journals, articles, news paper and many more. With the
help of this, researcher can easily take right decision and also draw a valid conclusion at the end
of the study. It is describe as published information which is connected to a specific area and a
particular topic or subject. It can be a basic summarisation and conclusion regarding a specific
subject but is basically has an organisational pattern and includes both summery and synthesis.
Concept of corporate governance
Corporate governance refer to those plans and policies through which an organisation is
governed and organised by the administration. It can be a technique which is utilised by the
management of companies to run their business in adequate and appropriate way in a particular
business industry. It mentions carrying a business firms as per the needs and requirements of
investors and stakeholders. According to Prince J. N.(2020), corporate governance is the
communication between several people of the company like board of directors, shareholders and
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others, in term of processing the performance of a company and the way it is executing towards.
Corporate governance includes systems and processed formulated to structure governance,
balance responsibility and provide accountability to shareholders at all levels (Armstrong and et.
al., 2015). It is beneficial for the companies because better governance ensures corporate growth,
financial development and provides effective inducement to the owner of the company and
managers to achieve aims and objectives that are according to interests of the shareholders. It
allows to company to place their effective traits and abilities on display. It trade with the manner
the providers of finance assurance themselves of acquiring a fair return on their investment
funds.
As per the view of Thomson L. M.(2009), corporate governance indicates to the set of
methods, principles and activities through which a firm is regulated. They offers the direction
that how a company can be directed or controlled in term of accomplishing its set business aims
and objectives. It help in adding value in the firm and also beneficial to the shareholders till long
term. It is based on principles such as organising the business with all honesty and fairness,
making transparency in context of all transactions, complying with all the laws of the land,
responsible and answerable towards the stakeholders and organising business in more ethical
way (Griffith, 2015). It is important and crucial for the company so that business of different
companies can be operate and run in effective or ethical manner in competitive market in term of
accomplishing business aims and objectives. Accordant to Porter M. E. (2019), corporate
strategy refer to those plan of actions which are framed and formulated by the management of
the company for effective governance of an organisation. Simply, it is an organisation-wide plan
to chose and develop particular market in which contend while developing various functions and
units of the business. There are two major components of corporate strategy like variegation and
straight segregation. Variegation indicates to explore market are and move to run business in to
new field while vertical integration states that when a firm make expansion into areas that
antecedently covered by suppliers (Jacoby, 2018). The plan and strategies which is developed for
effective governance of the company concern that how a firm can gain rival' benefits with the
help of its business. There are different things which should be consider by the administration of
a business firm in their plan of action such as flexible business activities, accurate market
information, effective production quality and effective assess to monetary fund etc. this all will
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