Corporate Governance and Ethics Analysis of Cardno Limited

This report provides a detailed analysis of Cardno Limited's organizational practices, focusing on corporate ethics and governance. The report examines Cardno's operations, financial health, and stakeholder relationships, drawing data from the organizational website and ASX.com. It explores corporate governance principles, board orientation, and the application of legitimacy theory to company communications. The analysis includes an overview of Cardno's business activities, its financial standing, and its engagement with stakeholders such as civil society and government. The report also discusses the role of the board, the importance of ethical relationships, and the impact of corporate governance on stakeholder management. Furthermore, the report discusses institutional investors and their role in the company. The report concludes by highlighting the significance of corporate governance in fostering accountability, efficiency, and reliable performance measurement.

Running head: CORPORATE ETHICS
Corporate Ethics
Name of the Student
Name of the University
Author Note

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Table of Content
Introduction................................................................................................................................3
Summary of corporate governance-ASX...................................................................................5
Board orientation........................................................................................................................8
Interpretation of company communications using Legitimacy Theory...................................11
Conclusion................................................................................................................................11
References................................................................................................................................13

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Executive Summary
This research report is a detailed analysis of the organizational practices of Cardno Limited
which is a global provider integrated professional services which enhances physical and
environment for communities in which the organization runs its operation. A secondary
analysis has been performed by collecting data from the organizational website. The report
consists of four different elements such as introduction and summary of the organization in
which the data has been gathered from ASX.com. Summary of the report a detail of the
organizational operation. Likewise, the section of corporate governance states the corporate
ethics that organization or the business is committed. The section of Board orientation states
how the members of the organization are assigned with their duties and responsibilities.

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Introduction
This research report is a detailed analysis of Cardno’s operation related to finance. Cardno is
a more of a global infstructure, environmental and social development company that runs
operation in more than 100 nation with the workforce around 6000 strong workforce. The
firm is united by a shared purpose to provide exceptional professional services to enhance
physical and social environment which makes a difference to people’s lives across the world.
The firm tends to deliver environmental consulting service with the natural assessment and
management, environmental impact review, monitoring the as well as agriculture
development, climate change management and many more of the same categories. Purpose of
the report is to perform a detailed analysis of corporate governance activities and stakeholder
relationship management of Cardno limited. In order to perform the analysis, a secondary
data analysis has been performed and the data has been collected from annual reports,
corporate sustainability reports of the organization, and wide reading sources. In order to
analyse the relationship of Cardno with the stakeholder and corporate governance theory has
been applied to the data. The following section discusses how the firm operates its functions
with respect to governance and ethics.

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Introducing and Summarizing- ASX
This research report is a detailed analysis of the organization CDD Cardno Limited. It
has been identified that the organization Cardno Limited has tremendous popularity and a
growing stake in the financial market. The organization for long has a strong financial health
and buyout growth outlook and it is also identified that Cardno limited is more of a
professional infrastructure and environmental service organization which is engaged in the
development as well as enhancement of physical and social infrastructure for the
communities around the world (cardno.com 2019). So, the firm is good at offering technical
and economic feasibility service, planning service with the inclusion of statutory planning,
urban development, master planning, design, mapping, surveying as well as transportation
planning. On the other side , it has also been identified that the firm tends to deliver
environmental consulting service with the natural assessment and management,
environmental impact review, monitoring the as well as agriculture development, climate
change management and many more of the same categories (cardno.com 2019).). On the
other side, organization has a wide base for providing a long series of software based
solutions for the organizations of domestic and global markets.
There are several reasons why the investors in the financial sector tend to look for the
base of CDD. This means an increasing number of organizations in the industry are
associated with CDD limited. One significant reason is that earnings growth potential in the
coming future could be around 30% which is exactly supported by its outstanding capacity to
churn out cash from running activities and this is predicted to more than double over the next
few years. This figures indicates that earning could be driven by some top or major line
activity instead of purely being unsustainable cost reduction activities (cardno.com. 2019).
This means CDD’s strong and effective financial health tends to indicate all sort of upcoming
liability payment that could be met with the help of current cash as well as short-term

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investment holding. This could suggest a prudent control over cash as well as cost by
management. Orlitzky, Schmidt & Rynes (2003, p.422) mentioned that above scenario is an
important determination of firm’s health. This means CDD’s debt to equity ratio could stand
for at 37% this means that the level of debt could be acceptable (Karaibrahimoğlu, 2010,
p385). It can also be mentioned that CDD’s capital structure could strike a significantly good
balance between the low cost debt funding and maintaining financial flexibility without
overly restrictive terms of debt. So, it can be mentioned hat due to the growing demand of the
financial programs and stable climate for the investors, CDD is leading ahead with respect its
financial capability and resources (cardno.com. 2019). However, the brand or the
organization should be aware of the fact that the brand or the organisation needs to be able or
capable of being a potential player of the market. This is because the market has been
dynamic in nature and consumers tastes and preferences have been changing in a rapid way.
Thus, the investors or the marketers have to be more concerned about the ways they perform
their responsibilities or meet the need of the market. Moreover, the organization should be
aware of the fact that number off competitors in the market is rapidly increasing. The
organization is most likely to face a tough challenge in the market (Milhaupt & West, 2004,
p.123).
Summary of corporate governance-ASX
It has been identified that the big shareholder groups tend to hold the power of the
company, Organizations could often hold the stock in a most effective way along with the
contribution of some bigger and established organizations in the sector. It has been expected
to see the insiders owing to a noticeable percentage of the smaller ones. So, the companies
that once used to be publicly owned often have a lower or ownership. So, it has been noted
that Cardno is more of a small size company along with the market capitalization of
AUS$465million, thereby, it could be flying under the radar of several organizational

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investors (Asx.com.au2019). Aebi, Sabato and Schmid (2012, p.3215) mentioned the fact that
intuitional investors tend to have or the compare their own returns of generally followed
index. Thus, they could generally do consider buying bigger organizations that are involved
in the most relevant benchmark range. It has been identified that cardno has a series of
institutional investors and most importantly they hold almost 18% of the overall stock (Labie,
2001, p.299). So this figure suggest the fact that some credit could go among the professional
investors however it is doesn’t depend on the fact alone because the organizations tend to
make poor investment every now and then. So like every other, one dies have multiple
institutions that could change their views on the stoic about the same time.
It has been identified that corporate governance strategy of the Cardno Limited is
appropriately associated to the stakeholders programs of the organization. It has been
particularly noted Cardno is facilitating effective engagement between civil society,
government as well as other stakeholder to enhance more elusive, responsive public along
with the policies and practices in Myanmar. So, it is observed that the major focus of the
governance is about caring stakeholders’ interest. Particularly, the interest of external
stakeholders of Cardno limited must be considered. For example, hence, the organization
Cardno developed a very effective and sustainable relationship with the stakeholders such as
society, government and the public where the firm presently operations its functions.
When it comes to the relation between corporate governance and stakeholders, Ayuso et al.,
(2014, p.79) mentioned that stakeholder relationship are highly important to business. It is
one such relationship that tend to underpin the existence of an organization. This means that
the theory addresses ethical misconduct which often occurs that remain despite the fact that
there is a knowing cooperation or compliancy that facilitates acceptance as well as
perpetuation of unethical conduct (Ayuso et al., 2014). Thus, it is observed that ethical
relationship is linked to both organizations success and organizational misconduct of Cardno

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limited. The organization Cardno develops a wide stakeholder both in their external and
internal relationship with the inclusion of employees, customers, suppliers and managers.
However, as the relationship network is large, ethical issues are most likely to occur. In the
case of Cardno, it has been identified that the organization mostly follows an autocratic
management style, but there is a significant gap between stakeholders group and managerial
or board members. Mason and Simmons (2014) mentioned the fact that corporate governance
is the mostly the formal system of accountability as well as the control of ethical and socially
responsible behaviour. Thus, whenever taking and implementing a corporate governance
strategy, it is highly important for the firm to communicate the same to all its stakeholders
internally and externally.
It is certain that huge amount of funds usually do not have a meaningful investment in
Cardno and there is some significant analyst coverage of the stock but it could still become
better familiar with the time. Moreover, it has also been identified that the definition of
insider could differ nearly between different nations but the member of the board is
effectively aligned with other shareholders. Nonetheless, on some particular occasions,
management of the company could run the business but owner or the CEO of the company is
the one who take control over the same. In this context, Samra, (2016, p.11) com mend that
several financial institutions tend to measure the performance against an index that
approximately the regional market players., thereby , they could usually play a great role or it
pays attention to the organization that are involved in some major indices. However, it has
been identified that Cardno has some major intuitions on the share registry and indeed they
tend to hold almost 20% of the company. This figure suggest that some credibility among
professional investors should be noted (Grais, & Pellegrini, 2006, p.221).
It has been identified that Board of Cardno tends to believe in the fact that success of
Cardno business is strengthened by developing a clearly articulated policies to increase the

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accountability, efficiency and the most reliable measurement of the performance. Moreover,
it has also been identified that the corporate governance statement of the company
demonstrates the extent to which Cardno meets principles (Aebi, Sabato, & Schmid, 2012,
p.3218). It has also been identified that a corporate statement of the company has been
developed with a series of framework that include the activities of the organization covering
all areas.
Board orientation
It has been identified that Board is established in under a certain conditions and
framework and the major objective of the board is to guide and assist the Board of Directors
particularly to discharge its corporate governance responsibilities to exercise the due care,
diligence, skills with respect to firm’s achievement of corporate goals within an appropriate
framework of both internal control and risk management. Orlitzky, Schmidt and Rynes
(2003.p433) mentioned the fact that the major objective of Committee is to assist the Board
of Directors to discharge its corporate governance responsibilities to exchange due care and
skills. One of the, major objective is to achieve corporate goals within an appropriate
framework or model of internal control report financial information to the users of financial
reports. The objective also includes the application of different financial accounting policies.
Objectives also include the actions of compliance with the company constitutional
documentation and material contracts. The Committee does not replace or replicate the
established management responsibilities as well as delegations or the reporting lines. Aebi,
Sabato and Schmid (2012) mentioned that organization must have to serve as an independent
and objectives partially about reviewing the financial information presented by the
management to Board as well as general public. Organization mist have to ensure
implementation as well as implementation of Enterprise Wide Risk Management system.

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It has been identified that the organization Cardno has implemented the concept of three
lines of defence as the most significant part of its governance and risk management
framework and the three lines are as following:
 Organization’s front line senior management from company’s different divisions has
the core responsibility for the management of risk and implementing effective
governance, risk management and suitable compliance framework (Labie, 200, p.201)
 Organization’s risk, legal and tax functions are highly responsible for facilitating the
effective identification assessment, management , reporting and monitoring of risk
 Internal audit is held responsible for delivering oversight and review of the
implementation of controls to identify, deal with or monitor the risk
Moreover, the Committee does not replace or replicate developed management
responsibilities and erase the reporting lines as well as responsibilities of internal audit or
external audit functions. This means the committee must have to ensure the implementation,
management and of Enterprise Wide Risk Management System and serve as an independent
and objective party to review the efficiency and effectives of the information delivered by
management to the Board concerning risk management, quality management as well as
occupational health and safety (Arzubiaga et al., 2018, p.4556). In addition, the
organizational committee must have to maintain the daily meetings, open lines of
communication among the Board and the internal as well s external auditors to exchange the
views and information and conform their individual or respective authority and responsibility.
The organization or the committee must have to determine the efficiency and effectiveness of
administrative operating and accounting controls applied by the organization.
Membership

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The Committee could be appointed by Board as well as control consist of at least
three respective members of the organization. In this context, the majority of members could
be the Chairman of the Committee. In addition, the committee must have to appoint the
chairman of the Committee. Moreover, the chief executive officer and Chief financial officer
must have to act accordingly as Secretary to the committee (Wincent, Thorgren, & Anokhin,
2014, p.335).
Duties and Responsibilities
According to this principles, the committee of the organization must have to take into
account the relating to the financial affair of the company, along with the external and
internal audit that it determines need to be desirable. As put forward by Wincent, Thorgren
and Anokhin, (2014, p.339), Committee must have to examine any sort of matters that are
referred by its Board. This means that the major duties and responsibilities of the committee
are such as financial integrity and in such context, the committee could assess and enhance
the adequacy and effectiveness of organizations of internal control surround the fundamental
financial as well as operational techniques by considering the report and recommendations of
internal and external audit. In addition to this, the committee must have to consider the report
and recommendations of internal and external audit and consider the information by delivered
by management, consider any other information asked by or provided to the Committee.
The organization must have to review the draft annual as well as half year financial
statement of the organization prior to the approval of the Board. The committee of the
organization must have to ensure compliance with statutory requirement for the financial
reporting and review the adequacy as well as effectiveness of organization system for
supervising and monitoring the compliance along with the regulations,. In addition to this,
Cardno’s own policies and techniques with respect to the fundamental as well as operational

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controls should be considered. The organization must have to consider the effectiveness on
the Company of any new or proposed accounting practices, principle development, and
discloser as well as legislative or regulatory pronouncement. In this context, Arzubiaga et al.,
(2018, p.459) mentioned that the organization must have to obtain the regular update from
management as well as Cardno’s senior and legal counsel with respect to the matter of the
compliance
Interpretation of company communications using Legitimacy Theory
It has been identified that legitimacy is more a generalized perception or assumption
that the actions of an element that are desirable, proper or appropriate within some socially
established norms, values and belief that are often communicated across the organization.
Aebi, Sabato, and Schmid (2012, p.3219) mentioned the fact that the legitimacy theory is
more a mechanism that help particularly guides organization in performing as well as
developing the voluntary social as well as environmental disclosure to meet the social
contract that could enable the recognition of the objects. This meant that social perception of
organization’ activities are particularly addressed to the expectation of the society. This
means when this large set of principle are considered in the context of an organization, it is
often seen that organizations do not respect the moral values, the company is severely
sanctioned by the society. Moreover, when it comes to interaction and communication
among the organizational, members, it is seen the organization must have to justify its
existence, through legitimate economical as well as social actions that do not damage the
existence of the society in which it performs.
Conclusion
In conclusion, it can be mentioned that corporate governance and effective
management of stakeholder relationship is an essential business requirement that organization

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must consider, especially, when it is running operation in a global business environment.
Cardno Limited has been able to build an effective corporate relationship; it has gained
capability of providing technical and economic feasibility service planning complying with
statutory planning. The organization complies with the procedures of urban development and
transportation planning. To maintain its corporate image Cardno is seeking to facilitate
effective management between civil society, government and all other stakeholders groups.
So, stakeholders’ interests are effectively considered in business decision making

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