Corporate Governance in Australia: Analysis and Review Report

This report delves into the realm of corporate governance, focusing on the Australian context and drawing upon the work of Rankin et al. (2018). It explores the significance of corporate governance as a framework encompassing the principles and procedures organizations adopt to oversee their operations, including monitoring actions, policies, and decisions. The report examines the potential benefits of reviewing foreign corporate governance frameworks to enhance the effectiveness of the Australian system. It emphasizes the importance of corporate ethics in the decision-making process within corporate governance, supported by various articles that provide evidence and analysis. The report further discusses the influence of decision-making processes and the alignment of stakeholder interests within the corporate governance structure. By reviewing and analyzing the frameworks, the report aims to provide a comprehensive understanding of corporate governance in Australia and its ethical considerations, while offering valuable insights for students and professionals alike.

Running head: CORPORATE GOVERNANCE
Corporate Governance
Name of the Student:
Name of University:
Author’s note:

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Executive summary
The study identifies the Corporate governance process as the governance structure that
includes the various principles and procedures that the organizations adapt in the supervising
their operations. It includes monitoring of actions, practices, policies, and the decisions of the
corporations, the associated agents and the shareholders who are affected. The report
discusses the article by Rankin et al., (2018, p. 224) that deals with the survey of the
corporate governance and is supported by other relevant articles. The focus is on the potential
benefit in reviewing the frameworks of foreign corporate governance, because they may point
the way to a more effective framework in Australia.

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Table of Contents
Introduction................................................................................................................................3
Corporate Governance in Australia............................................................................................4
Evidences in support of the statement by Rankin et al., (2018, p. 224).....................................4
Corporate ethics as an important factor of corporate governance process.................................5
Decision making and Corporate Governance............................................................................5
Conclusion..................................................................................................................................7
References..................................................................................................................................8

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Introduction
The concerned article that is to be by Rankin et al., (2018, p. 224), deals with the
survey of the corporate Governance in companies the Australian nations. It includes the
motive to collaborate the corporate ethics and responsibility in the decision making process in
the corporate governance mechanism to ensure that the corporate governance framework in
Australia is as effective as possible. The focus is on the potential benefit in reviewing the
frameworks of foreign corporate governance, because they may point the way to a more
effective framework in Australia. The main purpose of the discussion is to survey on the
corporate governance frameworks in the relevant article that supports the statement by
Rankin and establish the corporate ethics as a major element of Corporate Governance.
The corporate governance and Ethics
The mechanism of corporate governance refers to the control and the direction of the
corporations. It is the structure of governance and the various principle procedures that the
participants of the organizations adapt in the supervising their operations (Ferrell and
Fraedrich, 2015). It is asset of decision making procedures that guides the business members
including board of directors, managers, shareholders, creditors, auditors and other company
stakeholders. The corporate governance technique includes monitoring of actions, practices,
policies, and the decisions of the corporations, the associated agents and the shareholders
who are impacted. The attempts to align the stakeholder’s interest affect the corporate
governance practice. When it comes to ethics, it can be said that it is the lifeblood of the
governance process. The corporate ethics refers to the form of professional principles of
ethics that assesses the moral and ethical form of the business environment. Therefore as said
by Dodd (2017), the corporate governance and business ethics goes hand in hand.

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Corporate Governance in Australia
As said by Lim (2015) about the concept of corporate governance is in Australia, the
foreign experience of corporate governance may provide Australia with valuable lessons in
the techniques to fix potential problems with its system, or illustrate problems that can be
avoided. This article had reviewed, at a general level and as a basis for further research,
corporate governance in several South-East Asian jurisdictions.
Evidences in support of the statement by Rankin et al., (2018, p. 224)
For this study the few corporate governance mechanisms has been selected and
reviewed to come into several conclusions. The first conclusion is that the countries have
considered the advantage of setting up corporate governance frameworks. Secondly each of
the countries seems to have understand the correlation between the absence of corporate
governance and corporate failure (Yasser, Entebang and Mansor, 2015). Each of the
country’s framework of corporate governance seems to have been revised or designed, at
least in part, as a response to the economic crisis in the Asian countries along with the
corporate collapses. Moreover, the corporate governance frameworks are similar to that in
place in Australia. There several themes that are similar in each of the country’s framework.
The of the board of directors of the countries has focused in efficient corporate governance
codes, in other words they have emphasised on the necessary requirement of skill and
knowledge for carrying out duties towards the company’s resources. Other various
procedures observed by the author in this article includes the identification of the directors
and their duties, specifically for those who act in good faith in the optimum interests of the
organisation. At last, the author has observed that most of the jurisdictions have adequate
frameworks which they have enforced varies widely in a large extent. In this jurisdictions the
thing that is common is that lack of recognition of the value of corporate governance (Du
Plessis, Hargovan, and Harris, 2018). This due to the result of a weak rule of law within the

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jurisdictions, and the existence of corruption at different levels of those societies. Another
important factor identified in this article which may contribute to this is a lack of shareholder
power is in Singapore and Australia, where a significant proportion of the population owns
shares. There is a risk of the people who are politically empowered and legally aware, such
that they would be unlikely to tolerate infringements on their rights (Kim, Miller, Wan, and
Wang, 2016).
Corporate ethics as an important factor of corporate governance process
The Corporate governance along with the ethics reflects the organizational
philosophy out of which one motive is the determination of the fundamental goals of a
company. For instance if the objective of the company is to maximize the returns of the
shareholder, then forgoing the profits for other concerns is a violation of the fiduciary
responsibility of the company (Fang, Maffett, and Zhang, 2015). The people associated with
the corporations are entitled legally to the liabilities and rights due to citizens as persons.
Decision making and Corporate Governance
Ethics are the standards or rules that govern the daily decisions of the organization.
Tricker and Tricker (2015) consider the term “ethics” in the business with conscience or a
simplistic sense of “right” and “wrong.” Andriof and McIntosh (2017) on the contrary argued
with this concept and proposed that ethics is the internal code that governs the conduct of the
individual associated in the business. Corporations and professional organizations,
particularly boards in licensing, generally will have a written “Code of Ethics” that governs
standards of professional conduct expected of all in the field. It is important to note that
“law” and “ethics” are not synonymous, nor are the “legal” and “ethical” courses of action in
a given situation necessarily the same (Christensen, Kent, Routledge and Stewart, 2015).

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Statutes and regulations passed by legislative bodies and administrative boards set forth the
“law.”
The corporate governance technique includes monitoring of actions, practices,
policies, and the decisions of the corporations, the associated agents and the shareholders
who are impacted. The attempts to align the stakeholder’s interest affect the corporate
governance practice. When it comes to ethics, it can be said that it is the lifeblood of the
governance process. The corporate ethics refers to the form of professional principles of
ethics that assesses the moral and ethical form of the business environment (Armstrong,
Blouin, Jagolinzer, and Larcker, 2015).
Practices and rules of the Corporate governance, in which the organizations are run or
governed, is important because it is the governance of what is arguably the most important
institution of the economy that is capitalist. In one article by Bowie (2017), he has argued
that it is necessary to emphasis on the three issues while considering the corporate
governance. According to him the first issue is the concerns which people or groups who are
provided with membership. He has given the highest priority to this. The rights of
membership might be given only to one class of people associated in the business (Visser and
Tolhurst, 2017). The corporate governance system that concentrates on the shareholders is the
most prominent instance of this method within the realm of the corporation. In the
companies, the membership rights are given only to those people who provides the firm with
financial capital. Membership rights might alternatively be provided to more than one class of
people or groups. In the corporate ground, these bodies are usually said to have
a stakeholder system of corporate governance. Alongside shareholders, typical stakeholders
include employees, members of the local population, and representatives from supplier firms,
customers, and local government (Davies, 2016).

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Secondly in this regard, it is important to assess the rights that are given to members.
There are two broad sets of rights that are significance. Firstly, it is beneficial to emphasise
on the character of the rights of the people enjoy over governance. Secondly, it is necessary
to assess the rights over the surplus generated by the organization (Abdullah, Ismail and
Nachum, 2016).
Thirdly, it is important to understand the representation modes available to members.
Direct representation might be used to represent members’ interests. The people might vote
directly for a representative on the board of governors. Indirect representation occurs when
organizations are used to represent members (Crane and Matten, 2016). For example, a
council for consumer might be used to represent the views of customers. Proxy representation
occurs when a self-appointed board is used to represent the stakeholder constituency (Hasan,
Kim, Teng, and Wu, 2016).
Conclusion
The discussion is concerned deals with the mechanism of corporate governance as
stated by Rankin et al., (2018, p. 224) that collaborated the corporate ethics with the
governance process in the corporations. It has been identified that corporate ethics is an
important factor in the decision making process in the organization. Various articles has been
reviewed and the techniques of corporate governance in various business has been scrutinized
to support the statement. All the authors have more or less agreed with the statement and has
established the fact with the help of the evidences.

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References
Abdullah, S.N., Ismail, K.N.I.K. and Nachum, L., 2016. Does having women on boards
create value? The impact of societal perceptions and corporate governance in emerging
markets. Strategic Management Journal, 37(3), pp.466-476.
Andriof, J. and McIntosh, M. eds., 2017. Perspectives on corporate citizenship. Routledge.
Armstrong, C.S., Blouin, J.L., Jagolinzer, A.D. and Larcker, D.F., 2015. Corporate
governance, incentives, and tax avoidance. Journal of Accounting and Economics, 60(1),
pp.1-17.
Bowie, N.E., 2017. Business ethics: A Kantian perspective. Cambridge University Press.
Christensen, J., Kent, P., Routledge, J. and Stewart, J., 2015. Do corporate governance
recommendations improve the performance and accountability of small listed
companies?. Accounting & Finance, 55(1), pp.133-164.
Crane, A. and Matten, D., 2016. Business ethics: Managing corporate citizenship and
sustainability in the age of globalization. Oxford University Press.
Davies, A., 2016. Best practice in corporate governance: Building reputation and sustainable
success. Routledge.
Dodd, E.M., 2017. For whom are corporate managers trustees?. In Corporate
Governance (pp. 29-47). Gower.
Du Plessis, J.J., Hargovan, A. and Harris, J., 2018. Principles of contemporary corporate
governance. Cambridge University Press.

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Fang, V.W., Maffett, M. and Zhang, B., 2015. Foreign institutional ownership and the global
convergence of financial reporting practices. Journal of Accounting Research, 53(3), pp.593-
631.
Ferrell, O.C. and Fraedrich, J., 2015. Business ethics: Ethical decision making & cases.
Nelson Education.
Hasan, I., Kim, I., Teng, H. and Wu, Q., 2016. The effect of foreign institutional ownership
on corporate tax avoidance: International evidence.
Kim, I., Miller, S., Wan, H. and Wang, B., 2016. Drivers behind the monitoring effectiveness
of global institutional investors: Evidence from earnings management. Journal of Corporate
Finance, 40, pp.24-46.
Tricker, R.B. and Tricker, R.I., 2015. Corporate governance: Principles, policies, and
practices. Oxford University Press, USA.
Visser, W. and Tolhurst, N., 2017. The world guide to CSR: A country-by-country analysis
of corporate sustainability and responsibility. Routledge.
Yasser, Q., Entebang, H. and Mansor, S., 2015. Corporate governance and firm performance
in Pakistan: The case of Karachi Stock Exchange (KSE)-30.