Deakin University MAF302: Individual Critical Analysis of Bega Cheese

This report presents a comprehensive critical analysis of Bega Cheese Limited, an Australian-based leading producer and marketer of cheese and food products. The analysis delves into Bega Cheese's corporate structure, highlighting its commitment to transparency and accountability. It examines the company's corporate governance framework, including the roles of the Board of Directors, committees, and ethical decision-making processes. The report also assesses the effectiveness of Bega Cheese's corporate compensation policies. Furthermore, it explores the company's risk management strategies, particularly concerning pasteurization processes and customer requirements. The analysis highlights both internal and external corporate governance mechanisms, emphasizing the importance of CSR programs. The paper also discusses Bega Cheese's corporate social responsibility (CSR) program, examining how the company addresses environmental concerns, engages with stakeholders, and maintains a positive brand image. The report concludes by emphasizing the importance of CSR and corporate governance in maintaining a strong brand identity and gaining a competitive advantage.

Individual Critical Analysis – Bega Cheese
Student Name
Course Name
8October 2018

Executive summary
Bega Cheese Limited of Australia, formed in 1850s today is one of the leading cheese and
iconic food product producer and marketer. The firm has an established corporate governance
and corporate social responsibility. The firm is found in this research to be using a win-win
scenario where it monitors and ensures that the impact of the firm is not harmful to the event
and the society. The firm takes steps I minimizing its carbon footprint and create
extraordinary policies and welfare and development framework for its employees. The
stakeholders of the firm are all starting from its shareholders, staff, vendors, partners,
customers, and collaborators. The firm ensures everyone is getting a fair return on the time,
effort and money they are investing in the Bega Cheese brand. The overall brand image is
that of a socially responsible firm.
The paper finds that the business strategy of the brand is simple yet strong. The firm ensures
to use innovation on their side to create a responsible product, processes and work
environment for every individual associated with it. A lot of money is invested by the
company to make its products of high quality and use ingredients which are favorable to
human health.

Table of Contents
Introduction................................................................................................................................4
Current Bega Cheese Corporate Structure.................................................................................4
Bega Cheese Corporate Compensation Effectiveness...............................................................6
Risk management planning of Bega Cheese..............................................................................6
Internal and External Corporate Governance Mechanism of Bega Cheese...............................7

Introduction
A large number of Australian dairy making firms engaged in making cheese and other
specialty products based on diary are marketing themselves for competitive advantages. The
competition is high as most of the firms are competing globally. Bega Cheese is one such
firm who has been witnessed to be structuring themselves with highly effective and strong
corporate governance and uses CSR as their favorable marketing element (Bega Cheese,
2018). This paper is a summary of their CSR initiatives and the corporate governance which
is planned strategically for Bega Cheese.
Current Bega Cheese Corporate Structure
The case study organization, Bega Cheese is completely focused in the achievement and the
maintenance of the highest standards regarding transparency and accountability in its
management of the entire cheese business of Bega brand. The Board has long back
implemented varied policies of corporate governance and best practices which the brand
considered being standard and basic for consistent success and continued the expansion of
Bega Cheese brand along with enhancement of values for every stakeholder associated with
the brand. The Corporate governance principles and recommendations are framed with
mutually agreed basis with the shareholders of Bega (Mynuzee, 2018, p. 1-5).
As per the corporate governance statement, the company’s primary practices and policies are
in sync with the business objectives and recommendations. The Board of Directors of Bega
Cheese has played a major role in the development of the company’s corporate governance
guidelines by creating an infrastructure where management and Directors can all perse the
goals of Bega Cheese with the benefit created to its stakeholders. These frameworks are also
kept flexible such that it can give freedom to the firm to operate and conduct its business.

Structure of the Board
From time to time-based on the resolutions and decisions made by the Board, the Director
authorized numbers can vary. Currently, the executive chairman of the company is Barry
Irvin who has been leading the firm since 2000 to help expand from a regional dairy firm to a
global firm. Bega Cheese currently has 7 Directors (Anonymous, 2018).
• Max Roberts
• Raelene Murphy
• Richard Parbery
• Terry O’Brien
• Peter Margin
• Rick Cross
• Jeff Odgars
Following principles of corporate governance are maintained in the Bega Cheese Board.
Laying the foundations solidly for the oversight of the management
The function of management and Board Committees as per the Board Carter and the AUdot
and Risk Committee and the NRC or Nomination and Remuneration Committee. Board
Directors are helped with an induction process where the individual goes through company
policies and related operational information. The responsibilities are delegated to the CEO for
performing daily works of Bega Cheese. Duties of Chairman is also allocated for making
strategic business decisions for the growth of the firm. Enhancing the reputation of the firm in
terms of shareholders and the environment are reviewed regularly and enhanced (Bega
Cheese, 2018).

Add value
The Board of Bega Cheese comprises currently of 5 supplier directors, The external and
independent Director and Executive Chairman is also a part of this 5sipplier and has no
business or interest in the firm. The role and responsibilities of each of the directors are
mentioned clearly (BusinessCheff, 2018).
Ethical and responsible decision making promotion
Board of Bega Cheese endorses a common code of conduct based on which the firm performs
its corporate governance structure. A cohesive set of basic principles are used for the
Directors and stakeholders to work on including all employees.
Bega Cheese Corporate Compensation Effectiveness
The remunerations of the Directors, Executive Chairman, Non- Executive Directors, CEO,
and any personnels of key management all are as per the basic standards. The primary
management personnel details are all as per the Director's report of Bega Cheese. The
compensation is fairly justified for the returns made to the shareholders. Key management
personnel is recommended by the human resource committee and from nomination
remuneration. Remuneration governance of Bega Cheese limited is as per the detection,
attraction as well as basic duties of the CEO, Directors and all other key management
personnel (Annualreports, 2018, p.18-25). Corporate guidance is provided to the CEO and
Executive Chairman so that they can implement decisions to the Board with respect to the
remunerations as per human resource strategic planning of Bega Cheese Ltd.
One of the main roles is to evaluate and sort further sanctions to the Bega Cheese Board to
transform the board composition. This is to ensure that they are competent to operate
impactful and effectively in order to discharge their responsibilities as well as duties in a

sufficient manner (Anu, S. 2016, p.111-112). The second role is to suggest as well as assist to
the Board for ensuring that the company possesses human resource policies which are
coherent and enables that the group also helps in attracting and retaining the executives and
directors. All of them together will help in creating a value addition for the shareholders and
also support the business targets and objectives in a strategic manner. The procedures and
effective policies will attract, inspire and retain skilled people and its effectiveness for
meeting the current as well as the future requirement of the company shareholders (Brine and
Brown, 2016,p.11-12).
Risk management planning of Bega Cheese
Australian dairy producers did surveys to understand the risks the firm has from its varied
activities. A minimum time is needed as well as temperature which is prescribed in the code
of conduct related to high temperature and short time-based pasteurisations of cream and
milk in the making of dairy products. Pasteurization of dairy products is also represented as a
basic treatment which is used for the transformation of raw milk to different manufactured
products. The dairy products comprise the different enhanced level of solids or fats like
cream, ice-cream mix as well as yogurt, high-temperature combinations which as
standardized as per Australia New Zealand Food Standards Code. This aids in the
compensation of the protection of the microorganisms. There are risks Bega Cheese
experiences in relation to post-pasteurization related contaminations. This is a consistent
management issue faced by the firm manufactures, and this type of contaminants can be due
to environment and equipment or personal contamination. In order to manage such a risk,
Bega Cheese implements a robust control on the hygiene, cleaning as well as sanitation and
product handling methodologies as per the standards which ensures safety as well as
protection of the post heat treatment related to the final product (Vuir, 2018,p. 14-20).

Another risk which Bega cheese experiences are the uncertainties the firm faces in supporting
customer requirements. There are varied requirements of customers especially of a firm
works in different geographical locations. The changing needs of the customers are
responded and understood. If the needs of customers are not met the firm can lose the loyalty
of customers (Becker, 2018). A well-protected workforce which can manage the uncertainties
by a systematic and a consistent approach is followed by the firmin order to manage the risks.
Employees of this company are needed to manage the source of the uncertainties. Standard
frameworks are used by Bega Cheese to consistently manage the risks in an effective manner
such that the firm can create the best value possible. Risk management is integrated into all
the different decision-making procedures of the firm.
Internal and External Corporate Governance Mechanism of Bega Cheese
Corporate governance is extremely important for Bega Cheese as it aims to meet its strategic
business goals. The structure of corporate governance controls, detects, policies and
guidelines which help in driving the enterprise to a goal which is satisfying for the needs of
the stakeholders. It comprises internal as well as external mechanisms (Frieslandcampina,
2018).
Internal Mechanism
The best controls of any corporation occur from its internal corporate mechanisms. It helps in
the control as well as tracking of the activities as well as the progress of an enterprise and can
also make efforts to make corrective actions if the company at times goes off their usual
ethical track. Bega Cheese internal stakeholders are its employees, managers, executive’s
partners, and owners. The firm has made its business operations smooth with clearly reined
likes of reporting and performance measurement systems. The firm has structured its Board
with clear lines of duties, management oversight and independent audits, control

segmentation and policy development in order to frame its corporate governance (Davoren,
2018).
External Mechanism
These are the control mechanisms which the firms aim in controlling and managing on the
external environment of the firm. Legal compliances and sufficient debt management are
some of the external mechanisms of Bega Cheese in which it the organization aims in
imposing regulatory guidelines as well as union-related contracts for the best practices of the
business (Asx, 2018).
Bega Cheese is a globalized enterprise. Because of this the investors and manager of Bega
Cheese aim in developing a very strong understanding of how the Bega Cheese boards will
work in varied nations. There are many barriers to operating business processes in different
countries. Hence managers are spending more time to understand culture and preferences and
demands of consumers of global countries. Corporate governance is madein relation to the
environment, shareholders, employees and Board o directors. The various operations
associated with them are transportation, energy consumption; work process and farming
methods used which needs to be in sync with the CSR policies and practices governed in
Bega Cheese corporation (Leach, 2018). Every aspect related to the organization is tracked in
regular intervals by company management in order to frame a positive brand identity in order
to win the support of customers, partners and get a better position in the middle of the
competition.
Bega Cheese Corporate Social Responsibly Program
Bega Cheese has designed a corporate social responsibility program as the Australian
government has given governance for all firms to take reflective actions on their respective
carbon footprints. Bega cheese limited has adopted corporate governance, strategic business,

and corporate social responsibility as their effective CSR strategies. The CSR strategies of
Bega Cheese cover all the following elements effectively. Bega Cheese Corporation has its
designed corporate social responsibility for lowering the effects of greenhouse gas for the
betterment of the environment. CSR or corporate social responsibility is in relation with
treating its varied stakeholders in an ethical manner or in a socially responsible method. The
main aim is to protect and share the brand image in a positive manner (Reliefweb, 2014).
The community and stakeholder community has been heavily dependent on the firms CSR
policies with the help of enhanced cheese products. As a cheese producer, the firm is aiding
in the creation of enormous job opportunities thus enhancing the standard of living of citizens
in many companies. Local dairy farm products are used more in order to enhance and
encourage local producers. The carbon tax introduction has created a great opportunity for
the firm to focus on CSR concept and balance the impact on the environment of the firm.
Bega Cheese also makes enormous efforts to develop employee and promote the welfare of
its workers.
Conclusion
Works in relation to the corporate social responsibility of Bega Cheese the main
responsibility of an enterprise is no longer today only profit. From the basic well-being of its
employees to focus on CSR and philanthropic efforts are all today focused on the varied
social as well as environmental concerns (Laurea, 2018, p.120-136). Today it covers
different business practices with special focus on health and safety of employees, green
marketing practices, business and community engagement, engagement of stakeholders and a
lot of others. Corporate social responsibility has been one of the most prominent aspects of
organizations in the current century. Progress made in CSR is today made with parallel to
competition and achievement of other productive and profitable objectives for companies like

Bega Cheese. Every firm requires having corporate governance to monitor and evolve its
efforts consistently.

References
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