Analysing Corporate Governance at Marks & Spencer for Profitability

This report provides an analysis of corporate governance practices at Marks & Spencer, examining their impact on strategic business plans, challenges faced due to ineffective governance, and the role of governance in enhancing organizational profitability and productivity. The research delves into various corporate governance practices employed by the company, including building a qualified board of directors, defining roles and responsibilities, emphasizing integrity, evaluating performance, and engaging in effective risk management. It also identifies challenges such as lack of business production and ethics violations. The report concludes with recommendations for improving corporate governance to maximize profitability and productivity. Desklib provides students access to similar solved assignments and past papers.

Corporate Strategy and
Governance

Table of Contents
Chapter 1..........................................................................................................................................3
INTRODUCTION ..........................................................................................................................3
Research problem...................................................................................................................4
Research aim and objectives..................................................................................................4
Research questions.................................................................................................................5
About the chosen organisation/ Background .........................................................................5
Chapter 2..........................................................................................................................................7
LITERATURE REVIEW ......................................................................................................7
What are the various corporate governance practices employed by an entity for managing
strategic business plans?.........................................................................................................7
What are the challenges faced by Marks & Spencer due to ineffective corporate governance
practices?................................................................................................................................8
Chapter 3........................................................................................................................................13
RESEARCH METHODOLOGY...................................................................................................13
Chapter 4........................................................................................................................................17
Results and Finding .............................................................................................................17
Chapter 5........................................................................................................................................26
Recommendations................................................................................................................26
Action Plan ..........................................................................................................................26
Conclusion ...........................................................................................................................26
REFERENCES .............................................................................................................................27
APPENDIX....................................................................................................................................30

Chapter 1
INTRODUCTION
Corporate Governance refers to the way a corporation is governed. This is the technique
used by business concern and control and manages the business activities. This is important for
each organization to follow the regulations and rules which are formulated by managers to
operate the business regularly. This could be explained as main activity and legislation which are
designed for the purpose of bringing new working method and support to accomplish the
business goals. In other words, corporate governance relates to a system, used by management
for bringing new activities and functions which supports to develop the business productivity
(Boyle, and Schmierbach, 2019). It has seen that government has major role at the workplace and
operating the business as it introduces the different types of products and services by following
the guidelines that supports to develop organizational performance. This could be associated
with number of rules and functions that can help to filled managerial functions by providing right
directions to individuals.
Strategic management is the main functions for each organization as it bring new changes
and innovation at the workplace which can help to develop the organizational productivity. This
is important for each organization to have good resources and capital that can be used to
introduce the new products and services for the purpose of influence the number of employees
and attain higher profits. The managers is having different skills and abilities which can be uses
to develop the organizational performance. This refers to planning, organising, directing, and
controlling the organizational functions which can be used to accomplish the business goals. This
mainly used in identifying the direction, management, and use of available resources which can
help to develop the business productivity. Corporate governance is a set of rules, processes, and
practises that a company uses to direct and regulate its operations ( Nielsen, Eden, and Verbeke,
2020). It is critical for each corporate organisation to understand what its employees want and
how they may be fulfilled so that the appropriate products and services are provided and higher
performance is maintained. To understand about corporate governance Marks& Spencer has
been selected that is large size British retailer selling different types of products and services to
their customers at retail prices in order to increase the business productivity. The company
operates its business in changing environment by bringing new technology and services which

supports to accomplish the business goals. The report covers aims and objectives, problem
statement, literature review, and research methodology which used to develop the business
performance.
Research problem
The research problem within the research is that there are several dangers seen within the
organisation, all of which have a direct relationship with organisational functions. The research
problem means issues which arise while working and studying the topic properly. This is
analysed to show how, with the support of corporate governance practises, business processes
can be governed while minimising business implications. Furthermore, when suitable corporate
governance procedures are not followed within the organisation, detrimental effects on
operations might be noticed. The current research is about corporate governance which is used to
formulate the rules and regulations and for the purpose of growing their business and attaining
higher productivity. The major problem of current research is lack of resources and time which
has been created the challenge for running their business effectively. If there is lack of resources
and time management then could be challenging to regulate the business. The government is
having major role as it analysis the business structure and give permission to operate their
business effectively (da Silva Frost, and Ledgerwood, 2020). The managers requires to have
proper understanding and knowledge which are used to resolve the business problems and
attaining higher performance.
Research aim and objectives
Research aim
To analyse the significance of corporate governance practices in maximising
organisational profitability and productivity. A study on Marks and Spencer.
Research objectives
 To examine various corporate governance practices employed by an entity for managing
strategic business plans.
 To investigate the challenges faced by Marks & Spencer due to ineffective corporate
governance practices.

 To discern the role of corporate governance practices and strategies in enhancing
organisational profitability. Chapter 2
Research questions
 What are the various corporate governance practices employed by an entity for managing
strategic business plans?
 What are the challenges faced by Marks & Spencer due to ineffective corporate
governance practices?
 What is the role of corporate governance practices and strategies in enhancing
organisational profitability?
About the chosen organisation/ Background
Marks & Spencer is the larger size British multinational retailer with headquarters in
London, England that specialises in selling clothing, home products and food products. This is
important for management to understand what is happening around and how their customers will
be influenced to work where number of services should be introduced by managers to operate the
business regularly. The environment is changing day by day where it became important for
organization to understand the environment and introduce the kind of products which could help
to operate the business regularly. In business environment there are different types of corporate
strategies which are followed by managers to regulate their business and supports to develop the
organizational productivity. The aim of organization is to sustain in competitive environment by
offering better quality of products and services which supports to accomplish business goals. The
aim of business organization is to attain the higher performance by bring new changes in their
existing products and services as it helps to develop the organizational productivity. The
company has performed well even in Covid period where all businesses has affected badly. The
organization has followed the regulations in typical situation and maintained their all
performance systematically. Initially business was started from smaller scale and level then after
it has increased its productivity and sales by managing all functions and activities.
Research Scope
The current research is about corporate governance that are important to follow by
business industry to managing all functions and activities. The scope is wider where number of

people is working collectively in order to accomplish common goals. The organization
understand the needs of their customers and then introduce products by following the
government regulations that has supported to develop business productivity. The current research
will help to develop the business productivity and performance by focusing on regulations and
bringing changes accordingly (Hennink, Hutter, and Bailey, 2020).

Chapter 2
LITERATURE REVIEW
A Literature review is the study of particular topic which decided by individual for
collecting data and information. This is important for researcher to analysis the market and bring
new performance by managing the changes and attaining higher performance. The people is
requires to have proper understanding and knowledge regarding specific topic as it develop
understanding properly. The current research report is about corporate governance which uses by
organizations for managing their performance and creating a balance in running their business.
What are the various corporate governance practices employed by an entity for managing
strategic business plans?
According to Smith (2019), Corporate Governance is the involvement business
regulations governed by government for the purpose of bringing products and services in the
market. it became important for each firm to analysis the environment and comes to know what
kind of business requires to set up and how each function needs to perform. Strategic plan is
defined as high leverage organizational strategy which is used by business concern for the
purpose of managing a business and developing the production level. The managers requires to
have proper information and details regarding particular products and services which is
demanding by customers and introduce the kind of services. in relation to Marks and Spencer,
different practices are followed by management that are as followed:
 Build a strong, qualified board of directors and evaluate performance – This could
be explained as main practices which is used by individual and business concern for
building a strong relationship and keep qualified board of directors who supports to
accomplish business goals.
 Define roles and responsibilities – Employees and employees have different roles and
responsibilities which are follows to operate the business. In relation to Marks and
Spencer, management should follow governance policies by defining employer roles
which can help to accomplish the business goals (Tassopoulou, and Berti, 2019).
 Emphasize integrity and ethical dealing – The another practice is integrity and ethical
dealing which needs to be follow while running the business. In relation to Marks &

Spencer, managers build integrity and follows ethical standard which supports to
accomplish the business goals and performance.
 Evaluate performance and make principled compensation decisions – This practice
relates to evaluation of business performance by considering all incomes and expenses
and make principled compensation decisions. In context to Marks & Spencer,
management requires to have understanding and knowledge about performance
evaluation and compensation which are used to develop the business activities and
functions by influencing number of people and offering better quality of products and
services.
 Engage in effective risk management – To start and run a business needs to identify the
risk and problems which might be rise while operation. The Board of Directors is
responsible for strategic leadership in identifying the company's risk tolerance and
developing a risk management framework with defined accountability. It should analyse
the suitability of management's systems and procedures for detecting, assessing,
mitigating, and monitoring risk, as well as the sufficiency of its regular reporting. This is
important for business organization to identify the risk and put efforts to minimise the
risk. In relation to Marks & Spencer, management requires to have clear communication
with employees and customers that can help to manage the risk and supports to develop
organizational productivity.
What are the challenges faced by Marks & Spencer due to ineffective corporate governance
practices?
As per view point of Rosen (2019), Corporate governance is the formulation of policies, and
regulations which are formulated by government for the purpose of bringing changes and
running their business effectively. If there is strict regulations then could be challenging to
operate any kind of business as changes occur while operation and affected the business
negatively. This is important for each organization to analysing the environment and comes to
know what their employees wants how their customers will be satisfied which can help to
develop the organizational performance. Corporate governance is the system of rules, practices,
which are uses to bring changes in existing performance. For each business industry it is
important to follow the government regulations and policies as it supports to manage the all
business related activities and ensure all functions and activities are running effectively.

Lack of business production – Corporate governance is the effective regulation which are
needed to follow as it supports to operate a business by offering better quality of products and
services. In relation to Marks & Spencer, business faced the challenge of lack of production due
to ineffective governance practices. The managers should be follow all regulations which can
help to grow a business continuously.
Ethics Violation – This issue is also faced by business organization due to not following the
corporate governance and violate the ethical standards that create the challenge for organization
to operate their business. To operate any kind of business ethics are needed to follow as it
suggest right way to arranging and managing the business activities. In case of not following the
ethics in their business could be affect the business productivity. In case of Marks & Spencer,
ethics are needed to regulate the business which can help to operate the business regularly. This
could be challenging for business to bring changes by following the ethical standard that affect
business negatively ( Kusumah, 2020).
To be transparent – While operation a company should accurately report their profits and
losses then disclose in front of stakeholders as well as employees that could reduce the
organizational performance and productivity. In a business needs to have privacy as it could help
to bring the higher performance by reporting, and reserving funds. Due to ineffective corporate
office it could be challenging for organization to operate their business. In context to Marks &
Spencer, lack of transparency in their business and report that affect business negatively.
Accountability Issues – While running a business accountability is the major activity which
needs to operate the business regularly. To take accountability is good concern for business
industry as it bring changes and challenges to manage a business. This can help to develop the
organizational productivity. In context Marks & Spencer, accountability issue faced by
management where all activities will be affected negatively.
Lower sales and profitability – This is another challenge faced by organization while
operating a business due to ineffective corporate governance. Or instance, if there is no
regulations and policies then could be challenging for business organization to operate their all
functions and activities. In relation to Marks & Spencer, management faced the challenge of
lower sales and profitability negatively which affect the whole business badly (Jia, Huang, and
Man Zhang, 2019).

Conflicts Issues – Avoiding conflicts of interest is important as it affect the business
negatively. While running a business, there is need to have interest that can be used to operate
the all functions and activities properly. In a business number of people works collectively where
it became important to understand the goals and accomplish commonly. In context to marks &
Spencer, employees belong to other country and state who do not get ready to accept the
challenges which could affect the business negatively.
To discern the role of corporate governance practices and strategies in enhancing
organisational profitability.
As per view point of Al Kilani (2016), Corporate governance is the system of rules,
practices, and policies which are formulated for the purpose of running a business in changing
environment. This is important for each industry to analysis the environment and comes to know
how each functions and activities are going to perform. The organization requires having
understanding on governance practices and policies which should be followed to for the purpose
of growing their business. In relation to Marks & Spencer, role of corporate governance practices
and strategies that are explained below:
Provide incentives for the board and management – This is important for each
organization to understand the environment and bring the changes at market place which can
help to develop business productivity. In relation to Marks & Spencer, management provides
incentives to their employees and other business concern for the purpose of operating their
business effectively. This is important for each organization to analysis the environment and
attaining higher productivity (Flammer, Hong and Minor, 2019).
Introducing new products and services – This is important for organization to
introduce new products and services which can help to develop the organizational productivity.
To bring innovation and new technology could maintain higher performance. In context to Marks
& Spencer, management needs to analysis the marketplace and introducing new products and
services which can develop the business productivity and profitability (Mahanti, 2021).
Attaining higher productivity – The aims of business organization is to bring
innovation and new technology which can help to attain higher performance and productivity. In
context to Marks & Spencer, management understand the needs and wants of their employees
and offer kind of products and services that can help to develop the organizational performance.

The management is having god knowledge and skills which could be used to accomplish
business goals.
Shareholders are sufficiently informed decision – For running a business shareholders
are important as they understand goals and give their contribution to accomplish business goals.
The management of Marks & Spencer, shareholders are needed to increase the investment for
the purpose of expanding their business and attaining higher productivity.
Balancing economic development – Corporate governance is effective for any business
organization as well as country as it helps to operate business and increase contribution in
developing the economic situation. This is important for each organization to understand what
people wants and how they could be satisfied so that run the business by following the
government regulation and maintaining higher productivity. The Marks & Spencer is defined as
larger size organization that run its business by bringing changes and contributing in
development of UK. This ensure people that organizational is doing for welfare of country and
supported to accomplish the business goals.
Increase the sustainability of corporation – Each organization wants to retain or
sustain for longer period in competitive environment as it supports to operate the business and
bring changes in their existing workplace. This is important for each organization to analysis the
environment and maintain good performance. In context to Marks & Spencer, management is
having major role as they understand goals and increase the sustainability by investing in CSR
practices which encouraged the people to make buying decision and increase the productivity
(Abdallah, 2020).
From the above it has been analysed that corporate governance is playing major role
within Marks & Spencer as it used to introduces the new products and services, increasing
sustainability, attaining higher performance and balancing economic development, making
informed decision by shareholders, and providing incentives for board management by managing
all functions and changes effectively. This also supported to develop the organizational
productivity and profitability.
Conclusion
The report has concluded that corporate governance is used to following the rules and
regulations strictly for the purpose of managing all functions and activities. The management

should understand the needs and wants of their customers then offer kind of products as well as
services which can help to accomplish the business goals and productivity.