Impact of Corporate Governance and Big 4 Audit on Financial Performance of UK Supermarket Industry

This presentation explores the impact of corporate governance and big 4 audit on the financial performance of the UK supermarket industry. It analyzes the implications of corporate governance and the role of big 4 audit firms in regulating financial performance. The study also discusses the sustainability challenges faced by the industry and provides recommendations for improving financial performance.

MENTAL WEALTH
Introduction Materials and Methodology
Introduction
Corporate governance is the set of rules, regulations
and standards that levies obligations on business
organizations. These rules are legal compulsions
which are used to regulate and control the actions of
an organization. A company has to spend highly in
order to fulfil their corporate governance
responsibilities which impacts the financial
performance of the organization. Along with this, Big
4 Audit firms are also responsible to impact the
financial performance of businesses. In this research
poster the impact of corporate governance and big 4
audit will be assessed on the financial performance of
super market industry of United Kingdom.
Background
Supermarket industry of United Kingdom is
considered as one of the most growing industries of
world. Few industry leaders are Tesco, Sainsbury’s,
ASDA, Aldi, Lidl, Walmart and more. All these
organizations are capable to earn profit even in a
position where United Kingdom was suffering from
political changes due to BREXIT. This industry
requires to consider standards and regulations of
corporate governance and big 4 audit firms due to
which their financial performance gets impacted.
Hypothesis
• Corporate governance implications only impact
large organizations operating in UK supermarket
industry.
• UK supermarket industry’s financial performance
is negatively impacted but positively regulated by
big 4 audit firms.
• UK supermarket industry considers corporate
governance as an obligation rather than a
responsibility.
Objectives/Purpose
Topic:
The impact of corporate governance and big 4 audit
on the financial performance of UK supermarket
industry.
Objectives:
• To analyse the concept of corporate governance
and to understand big 4 audit.
• To identify corporate governance implications on
financial performance of UK supermarket
industry.
• To evaluate impact of big 4 audit firms on the
financial performance of UK supermarket
industry.
Materials
For the satisfaction of research hypothesis and
objectives, there are few materials including Journal
articles and books which are intended to be used:
Journals:
• Financialization in agri-food supply chains: Private
equity and the transformation of the retail sector.
• The role of auditing, food safety, and food quality
standards in the food industry
• Debunking the myth of shareholder ownership of
companies: Some implications for corporate
governance and financial reporting
• Corporate social responsibility and financial
performance: The moderating role of ownership
concentration in Turkey
Books:
• A handbook of corporate governance and social
responsibility
• Corporate governance: Principles, policies, and
practices
• Corporate governance matters: A closer look at
organizational choices and their consequences
Models
A model is an entire conceptual framework which is
used to undertake a research. For the present research,
a conceptual framework is developed that will include
all the variables of this research.

MENTAL WEALTH
Results
Methodology
A methodology is a set of research methods which are
used to conduct a research. In the present research, a
mixed research method will be used under which both
quantitative and qualitative data will be used. Along
with this, secondary data collection technique is
selected where all the data for this research will be
collected using books and journals.
This graph states Amazon follows all implications of
corporate finance due to which various market
leaders of UK’s super market industry are impacted
as their financial performance is at risk. As this
concept seems to be impacted only large
organization in above graph, the hypothesis 1 is
accepted. The third hypothesis is tested using this
graph; it has been analyzed that besides Amazon, no
other company in UK’s super market industry
(Figure 2: UK supermarket industry’s financial performance is negatively
impacted)
(Figure 1: Corporate governance implications only impact large organization's
operating in UK supermarket industry)
The concept of corporate governance states that all
business organizations are required to follow certain
rules and regulations in order to ensure that all
organizations are following their responsibilities
towards people and planet. This concept has been
developed to protect the interest of all stakeholders
including external and internal. The Four big audit is
a term used for the combination of four large
industry leaders of audit industry which are
responsible for auditing all major organization of
United Kingdom. These firms are responsible for
auditing the financial information of business
organization in order to eliminate all possible
financial misstatements. Corporate governance
includes various regulations due to which
ample implications for business organizations are developed. UK supermarket industry is one of the most
growing industries of the world. The organizations operating in this industry is restricted to overstate their
profits and present their over ambitious numbers in their financial reports; this restricted does not allow
them to attract higher investors due to which financial performance of this industry is impacted. Also the
concept of corporate governance ensures that the operations of UK’s super market industry are sustainable
due to which this industry has to look for alternatives of non sustainable components such as plastic which
leads to high expenses and ultimately results into impact on financial performance. This objective is the
base of hypothesis 1 and 3. The hypothesis 1 states that corporate governance implications only impacts
large organizations of UK’s super market industry and to check this assumption a graph is attached below:

MENTAL WEALTH
Results References
Discussion and Implications
The above investigation implies and provides a
point of discussion that there are various
restrictions developed by corporate
governance and big 4 audit firms but these also
brings sustainability in UK’s supermarket
industry.
Conclusion and Recommendations
The above investigation has helped in reaching
at the conclusion that corporate governance is
set of rules and big 4 audit is a set of 4 large
audit firms that ensures businesses fulfil their
responsibilities. By this investigation, it has
been recommended that auditing must also be
held mandatory for small organization and
these companies should also fulfil their
responsibilities.
Akben-Selcuk, E., 2019. Corporate social
responsibility and financial performance: The
moderating role of ownership concentration in
Turkey. Sustainability, 11(13), p.3643.
ArAs, G., 2016. A handbook of corporate
governance and social responsibility. CRC Press.
Burch, D. and Lawrence, G., 2013. Financialization
in agri-food supply chains: Private equity and the
transformation of the retail sector. Agriculture and
human values, 30(2), pp.247-258.
Kotsanopoulos, K.V. and Arvanitoyannis, I.S.,
2017. The role of auditing, food safety, and food
quality standards in the food industry: A review.
Comprehensive Reviews in Food Science and Food
Safety, 16(5), pp.760-775.
Larcker, D. and Tayan, B., 2015. Corporate
governance matters: A closer look at
organizational choices and their consequences.
Pearson education.
Sikka, P. and Stittle, J., 2017. Debunking the myth
of shareholder ownership of companies: Some
implications for corporate governance and
financial reporting. Critical Perspectives on
Accounting.
Tricker, R.B. and Tricker, R.I., 2015. Corporate
governance: Principles, policies, and practices.
follows 100% sustainability (corporate
governance) which leads to the conclusion that
hypothesis 3 is accepted.
Big audit 4 firms impact the financial
performance of UK supermarket industry by
restricting the companies operating in this
industry to misrepresent their financial
statements by which investors are not attracted
to them highly and they face financial loss. This
objective is related with hypothesis 2 which is
tested with a graph.
It is evident from above graph that profitability
of UK’s supermarket industry is reducing
continuously which accepts the hypothesis 3 that
UK supermarket industry’s financial
performance is negatively impacted but positively
regulated by big audit firms.