Star Entertainment Group Ltd: Ethical and Corporate Governance - ASX Compliance

This report discusses the Corporate Governance Structure and Mechanism and corporate governance compliance of the Star Entertainment Group Ltd. It covers the legal corporate governance of the company, structure of the board of directors, and strengths and weaknesses of the structure. It also discusses compliance with the ASX corporate governance principles and recommendations with 2014 amendments.

Star Entertainment Group Ltd
Ethical and corporate Governance
ASX Listing rules and compliance
Name of the author

Table of Contents
Introduction................................................................................................................................1
Corporate Governance Structure and Mechanism.....................................................................1
Strength of the structure and Mechanism...................................................................................2
Weaknesses in governance.........................................................................................................3
Compliance with the ASX corporate governance principles and Recommendations with 2014
amendments................................................................................................................................3
Conclusion..................................................................................................................................6
References..................................................................................................................................7

Introduction
With the ramified economic changes and strengthen corporate governance practice,
each and every Organizaiton needs to increase the effectiveness of its Corporate Governance
Structure and Mechanism and sustainability reporting in long run. This report focused on the
Corporate Governance Structure and Mechanism and corporate governance compliance of the
Star Entertainment Group Ltd. In this report, discussion will be made on the legal corporate
governance of company, structure of the board of directors and Strength and weakness of the
structure, Corporate Governance Mechanism and corporate governance compliance of the
Star Entertainment Group Ltd.
Answer to question no-1
Corporate Governance Structure and Mechanism
The Board of Directors and management of the company support the principles of
corporate governance for the long sustainability of the company. For the regularization of
corporate governance principles proper processes and practices have been established to meet
the essential needs of the group. Company is reviewing all the practices regularly and taking
into account all the applicable legislation and standards. It is complying with all the
recommended principles of ASX to maintain on-going compliances. It is laying down solid
foundation for management and oversight by specifying them their roles and responsibility.
They are assuring the effectiveness of arrangement for the better governance of the group.
The quality of the executive team and its appropriateness of organisational structure are
adequate with its proper control, procedures, policies and processes (Ravi, & Saxena, 2015).
They have an oversight vision for their targets and objectives with their strategic direction
and performance of the group. The code of conduct and other relevant policies are included in
the induction program. Company has Whistle-blower system for any misconduct or
anonymous crime and reporting of such acts to prevent the crime or misconduct. Company
has its policy for all the directors, contractors and employees regarding trading in securities.
They have a proper disclosure and investor communication procedure to report to the ASX
under its listing rules. To respect the rights of the shareholders they provide every needed
information on the website and conduct an investor relations program which facilitate and
encourage participation of shareholder in meetings (Mehrotra, & Mohanty, 2018). However,
due to the increased complexity and compliance program, it has failed to establish

harmonization in its domestic and international reporting framework. Company first needs to
focus on complying with the international rules and regulations in its reporting frameworks
and if in case the domestic rules are violated due to the international reporting frameworks
then these international rules will override the domestic laws due to the international business
functioning of company.
Strength of the structure and Mechanism
The corporate governance mechanism has numerous strength which helps to thrive
the market place. These strengths help to penetrate new market and protecting existing
markets. They are continuously producing new products and maintaining their product
innovation and maintaining a successful track record. The consistency of the quality of the
products is scaling up and down as per market demand due to Automation of industry. They
have successfully integrated number of companies in technology to streamline its operation
and to build supply chain by keeping track record of mergers and acquisition of the firms.
They have maintained their high customer satisfaction and brand equity among its potential
customers (Choong, & Leung, 2015). They have invested a huge to build a strong brand
portfolio. They have good returns on their capital expenditure by building new revenue
streams. They have reliable suppliers for the continue supply of raw material. They have
highly skilled workforce through its learning and training program, equally they have
motivation to achieve more. Government has also opened up an opportunity for the
procurement of its products in the name of green drive. It has started new sales channels
which will help in knowing the customer better by using big data analytics. They have
pipelined new environmental policies which will help in gaining market share with new
product category (Jolson, 2015). In context with the board of directors, company has hired
more than 1/3 directors who are independent and having no pecuniary relation with the
company. These directors take their decisions under the board resolutions (Grais, &
Pellegrini, (2016). It is analyzed that company has also followed international reporting
compliance program in its business which may strengthen the overall outcomes and
efficiency of the business. It is considered that company has maintained the proper
transparency in its business which has also resulted to aligning the interest of the stakeholders
with the organization development (Choudhary, Merkley, & Schipper (2018). It will also help
company to increase the overall outcomes and brand image of company on international
level. The strong legal compliance, increased business transparency has resulted to the strong

Corporate Governance Mechanism and corporate governance compliance of the Star
Entertainment Group Ltd. It will also help company to keep the business more sustainable
and effective in long run (Ni, & Van Wart, 2015).
Weaknesses in governance
Star Entertainment is improving continuously to overcome its weaknesses in a best
possible way. They are continuously making strategy for this. The main reason where they
are lagging behind is their forecasting for their product demand and it is leading to high
inventory in channel. They are not able to tackle the challenges given by new entrants and
they are losing market share in niche category due to the increased legal compliance and
issues related to Corporate Governance Mechanism and corporate governance compliance...
They are limiting to adjacent product segments as they are compatible with present business
models only (Ni, & Van Wart, 2015). Their financial planning is not proper or efficient due
to the increased governance penalties and issues in the governance program of company.
They need to investment more in new technologies to process across the board. Their
investments are not as per the vision of their company. Consumers are changing their buying
behaviour towards online channel they need to be more strengthened in technological way.
These increased business challenges have also made its data privacy policies and governance
program weak. They are lacking in their innovative product range which swings the sales
numbers. Their pricing strategies are leading to serious pressure on its profitability. They are
isolating their trend in America which is negatively impacting the international sales. They
are not aware of liability laws of every country they are dealing in which is creating liability
claim in those markets (Hennig & Houston, 2017). The main weakness of the corporate
governance of company is based on its legal experts.
Compliance with the ASX corporate governance principles and Recommendations with
2014 amendments
Corporate governance principles give in ASX focused on keeping business more transparent
and sustainable in long run. There are main eight corporate governance principles given by
the ASX for the listed company which they will have to comply in order to keep the business
more sustainable in long run. It is analyzed that if company could mitigate the accounting and
legal compliance issues then it will also avoid the possible issues related to penalties and
charges (Choong, &Leung, (2015). It is analyzed that company has also hired more than 1/3

independent directors in its board of directors who will be keeping the close look on the
corporate governance and financial transactions of company. In addition to this, audit
committee and other concerned committees are indulged in making the business more
transparent and effective throughout the time Star Entertainment Group Ltd has also followed
ethical business code of conduct in its business reporting frameworks which will keep its
business more beneficial for its stakeholders. If company wants to make its business more
effective than it needs to focus on aligning the interest of the stakeholders with the
organizational development. The transparency is also one of the major factors in AX listing
compliance. It is considered that if company takes board management decision then the same
will be disclosed to Australian stock exchange with a view to maintain the transparency in the
business (Francis, & Zheng, 2010).
A higher debt poses a threat to company’s profitability in downturn. Star Entertainment has
underperformed in the consumer service industry in their average growth earnings. There
should be material exposure to the social, economic and environmental sustainability
program. The board’s skill matrix should indicate the skills, expertise and experience that are
necessary for the optimal performance of the board. Adoption of recommendation of ASX
listing was slightly lower than previous year (Christensen et. al. 2015). In addition to this,
company have also been facing issue in making the timely disclosure which may negatively
impact the business in long run. It is analysed that company should focus on setting up the
effective legal compliance department if it wants to keep its business more sustainable and
effective.
Answer to question no-2
The recent sustainability reporting of the Star Entertainment Group Ltd
It is analyzed that in the recent sustainability reporting of the Star Entertainment Group Ltd it
is reflected that company has invested AUD $ 112 million in its CSR activities with a view to
align the interest of the stakeholder’s with company’s mission, and motivations for issuing a
sustainability report. An analysis shows that Star Entertainment is not able to meet its
upcoming commitments and short term assets.
Scope of the sustainability report

Company has showed its compliances towards ASX corporate governance principles by
laying down foundation for management and oversight. To overcome the previous debt issues
they have structured its financial board to fulfil the commitments. They are promoting ethical
and responsible decision making by establishing a code of conduct. The main scope of the
sustainability reporting is to strengthen the transparency and ethical business functioning.
They have structures safeguard integrity in their financial reporting by establishing the audit
committee (Francis, & Zheng, 2010). This committee helps management to make changes in
Corporate Governance Mechanism and corporate governance compliance of the Star
Entertainment Group Ltd so that it could easily establish the harmonization in its reporting
and legal laws program. Timely disclosures are been made concerning the company for the
better connection with the shareholders.
Address the GRI content and quality principles,
They are establishing written policies to ensure the accountability at senior executive level
and disclosure policies and summarise them (Shimeld, 2017). They should respect the
shareholders and facilitate them effective exercise of their rights. It can be done by using
electronic communication process in organization (Foster, & Shastri, 2010). They should
recognize and manage the risk involved in the market with its oversight vision and internal
control. They should remunerate fairly and responsibly by establishing remuneration
committee. They should provide all the information on the company’s website including the
governance and entity.
Key achievements in sustainability initiatives
It is analyzed that company has showed its compliances towards ASX corporate governance
principles by laying down foundation for management and oversight although the main focus
of company that should be on the setting up strong corporate governance mechanism which
could also strengthen ethical business compliance of company. In addition to this, in context
with the stakeholders, in its CSR report, it has reflected that the star group operate on its
Dividends Reinvestment plan for its final dividend. Board considers it appropriate to
maintain mix of skills, experience, diversity and knowledge in the membership of the board
to add value to the needs of the stakeholders and society.
Main findings in the assurance or review of the sustainability report

All the managers and directors need to review annual risk for making next year’s annual
program. In addition to this, In the CSR and sustainability reporting of company it is found
that company has faced high penalties from the Australian stock exchange due to its failure to
comply with the listing agreements and laws. It will not only increase the overall costing of
the business but also make business more risky in context with the sustainability (Grais, &
Pellegrini, 2016).
Conclude with an overall evaluation
They conduct induction programme and supporting plans to strengthen its CSR activities for
its stakeholders. In addition to this, proper disclosure is also made in its CSR report about the
CSR activity and invested funds. .It focuses on the transparency and ethical legal compliance
program is the base to strengthen the corporate governance mechanism of Star Company and
increasing the overall ethical business sustainability in long run (De Janasz, & Whiting,
2009).

Conclusion
After assessing all the detail and information of the Star Entertainment Group Ltd, it
could be determined that the management indulged in the legal compliance program of
company should undertake proper corporate governance mechanism in its reporting
framework. By hiring the separate legal compliance department width the ethical and
sustainable business practice it could easily strengthen the legal compline program and avoid
the possible. Now in the end, it could be inferred that company has established strong
Corporate Governance Mechanism and corporate governance compliance in its reporting
program which will not only align the interest of the stakeholders but also strengthen overall
brand image in long run. It is inferred that The Board of Directors and management of the
company needs to align the principles of corporate governance for the long sustainability of
the company.

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