Impact of Corporate Governance on Waitrose's Success and Failure

This report provides a detailed analysis of corporate governance within Waitrose, a UK-based grocery retail company. It examines the company's history, focusing on the successful aspects of its corporate governance, such as stakeholder relationships, product quality, and employee ownership, and how these factors contributed to its success, especially after Brexit. The report also explores areas where Waitrose has faced challenges, like limited advertising and discounting strategies, impacting its market position. It highlights the importance of sustaining successful governance practices, including maintaining product quality, incorporating feedback, and environmental initiatives. The analysis considers the role of the board, the ASX guidelines, and the overall impact of corporate governance on Waitrose's business strategy, providing recommendations for future improvements. The report references various academic sources to support its findings and conclusions.

CORPORATE GOVERNANCE
 Word count: 2307 Words
 Student name:
 Student number:
 Subject name:
 AQF Level:

Executive Summary
In this study, the different aspects of the Corporate Governance have been illustrated, with
respect to the UK-based grocery retail company called the Waitrose. Different aspects of the
Corporate Governance including the role and the impact of the parameters of the Corporate
Governance including their stakeholders and the management officials have been described.
The impact of the Corporate Governance on the success and the failure of the business
strategy for the Waitrose in the recent years have been described. The factors that led to the
successful implementation of the corporate governance in the context of the Waitrose have
been analysed. The factors that led to the successful implementation of the corporate finance
and their sustainability have also been discussed in the context of the Waitrose.

Table of Contents
1. Introduction............................................................................................................................1
2. Background of the Waitrose...................................................................................................1
3. Successful aspects of Corporate Governance in the Waitrose...............................................1
4. Factors leading to the success of the Waitrose.......................................................................2
5. Sustaining the aspects of the success.....................................................................................3
6. Aspects where the Waitrose has been less successful in incorporating corporate governance
....................................................................................................................................................3
7. Reasons for the lack of implementation and recommending ways to achieve these.............4
8. Conclusion..............................................................................................................................5
References list............................................................................................................................6

1. Introduction
This report is based on the corporate governance and its relevance to the Waitrose, a grocery
retail company in the UK. The Corporate Governance is referred to as the different styles and
the procedures that allow the company or the different companies to maintain their strategy
and their working procedures in a given time, in their respective business environments
(Joneset al. 2014, p.132). It has been seen that the Corporate Governance is governed by the
statute combination of their stakeholders, suppliers, management authorities and the decision-
makers of the company. Therefore, it may be stated that much of the fate of the company is
dependent on the Corporate Governance scheme of the company.
2. Background of the Waitrose
After its establishment in the year 1904, Waitrose has been dealing with the grocery and the
supermarket facilities in the areas of the UK. Since its establishment, the Waitrose has been
burdened with the responsibility of providing the products and services of superior quality to
the customers of the UK. By 2015, the company has produced over 350 branches of its
presence and all of these are implemented with similar objectives to supply the products to
the customers that are of superior quality and value as compared to the other companies that
are present in the UK. It is currently the 6th largest grocery retail in the UK. One of the most
notable contributions of the company is that they have the legal warrant for supplying the
grocery and the wine to the queen’s palace in the UK. Currently, the Waitrose provides
employment to over 91000 employees in the UK(www.waitrose.com, 2017).
It has been observed that the different processes and the business environments have led to
the changes in the structure of the business operations for the Waitrose, including the exit of
the UK from the European Union. However, the strict Corporate Governance strategies of the
company allow them to sustain their business statistics in the recent years. Waitrose has been
considered to be one of the first supermarket companies that dealt with the sale of the organic
foods and therefore influence the procedures of environmental protection in the UK.
However, the prices of the products and services are comparatively higher, as compared to
the dominating companies in the UK including Tesco and Sainsbury’s (Manning, 2013, p.20).
3. Successful aspects of Corporate Governance in the Waitrose
In the modern context of the business environments, it has been observed that the changes in
the business environments have led to the differences in the corporate governances of the
companies. In the context of the Waitrose, a similar situation has been observed. A number of
successful aspects of the corporate governances have been observed in the context of the
Waitrose. These include the development of the economy of the company since its exit from
Page | 1

the European Union. It has been observed that the Brexit elections and the consequent exit of
the UK from the European Union led to a severe crisis in the economic stability among the
different companies in the UK. Waitrose has been similarly burdened with similar fates and
the resultant lack of the economic stability has been observed since then (Chkanikova and
Kogg, 2015, p.10). However, the strategies of the successful execution of the corporate
governances allowed the company to have successful insights and thereby improve their
economic stability very successfully at a faster rate.
It has been seen that the relationship with the stakeholders and the shareholders forms an
important part of the corporate governance for the company including the Waitrose.
Therefore, it has been seen that the overall structure of the corporate governance is directly
related with the overall management structure of the Waitrose. It may allow the company to
manifest their relationship with the shareholders as well as the customers and this indicated
the overall sustainability of their corporate governance structure.
The maintenance of the superiority in the quality of the products that are offered by the
Waitrose, in spite of the lack of the financial stability has been another area that has led to the
insights for the company to ensure their effective and efficient incorporation of the corporate
governance in the context of the Waitrose. Therefore, it may be ascertained that although the
company had faced an economic scarcity after the disintegration of the UK from the
European Union, yet the quality of the products and the services of Waitrose remained
unaltered and this contributed to the aspect of the successful implementation of the corporate
governance of the Waitrose (Gouldson and Sullivan, 2014, p.2989).
4. Factors leading to the success of the Waitrose
It has been noted that the Waitrose has been successful in the recent years and the major
factor that have attributed to their success has been laid towards the strict implementation of
the corporate governance of the company. It has been noted that the Waitrose has been one of
the largest employees owned retail in the UK. Therefore, the major decisions and the skills
for the marketing have been laid towards the development of the employees and their skills. It
has been seen that the major reasons relating to the maintenance of the quality of the products
and the services for the company has been sourced towards the specialised skills of the
employees that allowed them to provide the superior quality of products even at the lack of
the availability of the resources (Çetinkayaet al. 2015, p.57). Moreover, in this case, the risk
management of the company has played an active role, and it stated that the company are
required to maintain the quality of the products that they have been producing in the recent
years. Therefore, in this case, both the skill of the employee and the decisions of the
Page | 2

management of the company have their active involvements in the development of the
stability of their economy.
The lack of the effective advertisement strategy has been one of the major drawbacks of the
company. In this context, the retention of the customers becomes difficult for the company.
However, the corporate governance skills of the company allowed them to eradicate this
barrier. In this case, the company had planned the strategy of providing sponsorship to one of
the leading grounds in the UK. Although, the company did not believe in the overcharge of
the sponsorships and advertisements, yet it decided to provide one of the sponsorships in the
jersey of the England cricket team (Chkanikova and Lehner, 2015, p.81). This allowed the
customers to be attracted towards the company. The international concern also aroused and
this has led to the active retention o the customers in the areas of the UK and Wales.
Therefore, in this case, the different areas of the corporate governance from the company
management executives allowed them to have their only sponsorships in the England cricket
jersey. This provided them to survive the economic success in the context of the UK, after the
Brexit elections (Caritteet al. 2015, p.301).
5. Sustaining the aspects of the success
It has been noted that the success of the Waitrose has been attributed to the different
strategies and the modes of the corporate governance. However, in order to have a continuous
development in these business perspectives and at the same time, in order to have their
successful economic growth in the future years, the sustainability of these methods is
required to be important for the company (Petljak and Štulec, 2015, p.54).
One of the sustainability methods that may be adopted is the stable maintenance of the
quality of the products. It has been seen that the only factor that has led to the increased
retention of the customers even at the times of the economic recession for the companies in
the UK, is the superior quality of products by the Waitrose. Therefore, in the future years, the
superior quality maintenance may allow the company to have the desired quality of economic
stability and sales in the UK.
Another important method is the ability of the company to accept feedbacks and the
implication of the environmental protection initiatives. The feedback systems may allow the
company to have their orientations towards the development of the different departments and
aspects of the company (Pedersen and Gwozdz, 2014, p.248). Therefore, in this case, the
company may implement the feedback system. It may provide the insights for assessing the
weaknesses and thereby implement the desired changes in the company. On the other hand,
the environmental protection plans for the company may allow the Waitrose to have their
Page | 3

modes of operations-oriented towards the availability of the products that are
environmentally friendly. This may improve the customer retention and at the same time,
may allow the company to have their desired modes of corporate governance in the future
years. It has been seen that the aspects of the ASX involves a different set of rules including
the different auditing systems that have generally being followed by the Waitrose in the
different time periods. The board meeting and the issue of the audits every year are evenly
managed by the ASX council and its directives within the governing body of the Waitrose.
6. Aspects where the Waitrose has been less successful in incorporating corporate
governance
Lack of advertisements
One of the major areas where the company have failed to achieve the desired levels of
corporate governance is the areas of the advertisements. It has been seen that the Waitrose do
not have the management that supports the extensive use of the advertising procedures for the
company. It has been seen that the company has comparatively lower levels of
advertisements as compared to the other grocery retailers in the UK including the Tesco and
the Sainsbury's (O’Higgins, 2015, p.161). In the recent years, the level of annual sales of the
company has seen to be reaching satisfactory levels, as compared to the other companies in
the UK. Therefore, it may be stated that the advertisement schemes had led to the
shortcomings in the levels of the corporate governance in the context of the Waitrose.
Lack of additional discounts
Many of the companies in the UK, is based on the different business management schemes
including the levying of additional discounts on their products and services at the different
times. It has been seen that the leading grocery retailing companies including the Tesco and
the Sainsbury’s have led to the development of a number of aspects including the attraction
of a large number of customers in the region of the UK (Soundararajan and Brown, 2016,
p.100). In many aspects, the lack of the extensive discounts led to the loss of a large number
of customers in the UK. However, the company had other strategies that allowed them to
maintain a stable number of customers in the UK, including the production of the products
and services of superior quality. Therefore, in this context, it may be ascertained that the lack
of the proper improvisation of the discounts led to the lack of the increased customer
retention ability for the Waitrose in the recent years and thus, may be considered to be one of
the lack of the activeness of the corporate governance for the company (Gimenez and Sierra,
2013, p.191).
7. Reasons for the lack of implementation and recommending ways to achieve these
Page | 4

It has been noted that levels of advertisements have been noted because of the insufficiencies
in the modes of the decisions by the management of the company. It has been stated that the
different higher professionals had different views about the advertising strategy of the
company. It has been noted that the lack of the stable means of advertisements sourced to the
ethics and the differences between the decisions of the management (Storeyet al. 2014,
p.641). The same sources are responsible including the higher annual profits led to the
company to devise the strategy to have no discounts or very minimal discounts on their
products and services, as compared to the products and services of the rival companies in the
UK.
Recommendations
In these cases, the recommendations may be stated as follows:
Increase their modes of advertisements
Advertisements play an important role for the companies, especially the business companies,
to increase their levels of awareness among the customers of a given area. Therefore, in the
context of the Waitrose, it has been seen that the increase in their modes of advertisements
may allow the company to attract a large number of customers. At the same time, the newer
products that may be introduced by the Waitrose may be introduced to the customers through
the active modes of advertisements. Therefore, in this context, the advertisements may be
another way by which, the corporate governance strategies may be achieved by the company.
Increasing their environmental protection campaigns
The company may increase the levels of their campaigns for the environmental protection.
The increase in these campaigns may allow the company to showcase their levels of
environmental awareness and their ways to protect the environment to the general people. As
a result of this, the company may increase their number of customers and as a whole, the
number of customer bases increases. Therefore, increasing the frequency of the
environmental protection campaigns may allow the company to retain an additional number
of customers in a given period of time.
8. Conclusion
Finally, it may be stated that the overall assignment states the importance of the Corporate
Governance in the context of the business environments of Waitrose. It may be concluded
that a number of hurdles may be exposed to the business processes of the company. This may
be a result of the development of the different adversities in their business environments.
However, the flexible nature of the corporate governance allowed the company, to have their
desired development in their modes of business operations in the UK. Therefore, the
Page | 5

corporate governance holds the responsibility for the success of the Waitrose in the recent
years.
Page | 6

References list
Caritte, V., Acha, S. and Shah, N., (2015). Enhancing corporate environmental performance
through reporting and roadmaps. Business Strategy and the Environment, 24(5), pp.289-308.
Çetinkaya, M., Agca, V. and Özutku, H., (2015). Priorities for Corporate Social
Responsibility Reporting: Evidence from Listed Turkish Companies in Istanbul Stock
Exchange. Journal of Economic and Social Studies, 5(2), p.57.
Chkanikova, O. and Kogg, B., (2015). Sustainability governance service providers: the role
of third-party product certification in facilitating corporate life cycle management. The
International Journal of Life Cycle Assessment, pp.1-13.
Chkanikova, O. and Lehner, M., (2015). Private eco-brands and green market development:
towards new forms of sustainability governance in the food retailing. Journal of Cleaner
Production, 107, pp.74-84.
Gimenez, C. and Sierra, V., (2013). Sustainable supply chains: Governance mechanisms to
greening suppliers. Journal of Business Ethics, 116(1), pp.189-203.
Gouldson, A. and Sullivan, R., (2014). Understanding the governance of corporations: an
examination of the factors shaping UK supermarket strategies on climate
change. Environment and Planning A, 46(12), pp.2972-2990.
Jones, P., Hillier, D. and Comfort, D., (2014). Assurance of the leading UK food retailers'
corporate social responsibility/sustainability reports. Corporate Governance, 14(1), pp.130-
138.
Manning, L., (2013). Corporate and consumer social responsibility in the food supply
chain. British Food Journal, 115(1), pp.9-29.
O’Higgins, E., (2015). ‘Is the Co-operative Model a Realistic Alternative to Traditional Joint
Stock Companies?. Ethical Innovation in Business and the Economy, G. Enderle and PE
Murphy, eds. Cheltenham, UK: Edward Elgar Publishing, pp.161-83.
Pedersen, E.R.G. and Gwozdz, W., (2014). From resistance to opportunity-seeking: Strategic
responses to institutional pressures for corporate social responsibility in the Nordic fashion
industry. Journal of business ethics, 119(2), pp.245-264.
Petljak, K. and Štulec, I., (2015). Explorative analysis of corporate social responsibility
reporting: the case of leading European food retailers. InterEULawEast-Journal for
International and European Law, Economics and Market Integrations, 2(1), pp.45-58.
Soundararajan, V. and Brown, J.A., (2016). Voluntary governance mechanisms in global
supply chains: Beyond CSR to a stakeholder utility perspective. Journal of Business
Ethics, 134(1), pp.83-102.
Page | 7

Storey, J., Basterretxea, I. and Salaman, G., (2014). Managing and resisting ‘degeneration’in
employee-owned businesses: A comparative study of two large retailers in Spain and the
United Kingdom. Organization, 21(5), pp.626-644.
www.waitrose.com, (2017) WAITROSE Available at: http://www.waitrose.com/ [Accessed
on 21 Feb 2017]
Page | 8