Comprehensive Analysis of Meridian Company's Performance: Weeks 5-9

This report provides a comprehensive analysis of Meridian Company's performance, covering weeks 5 through 9, addressing various aspects of its operations and corporate governance. The report begins with an examination of the 'tragedy of the commons' and its relevance to Meridian's environmental practices, followed by an assessment of how Meridian employees have engaged in environmentally harmful conduct. It proposes statements for inclusion in Meridian's code of conduct to address these issues. The report then explores the function of an external auditor, the benefits of their presence at the annual general meeting for shareholders, and the drafting of terms based on Principle 4.3 for inclusion in enforceable undertakings. It also delves into how companies should handle and protect confidential information, identifying stakeholder groups that should be investigated to identify leaks of earnings information. Finally, the report discusses the concept of board accountability, Principle 6 of ASX Corporate Governance, and examples of shareholder rights. The report provides a detailed overview of the company's performance, challenges, and recommendations for improvement, including the importance of ethical conduct and responsible business practices.

Assessment

TABLE OF CONTENTS
WEEK 5: GROUP 2........................................................................................................................3
Tragedy of the commons.............................................................................................................3
How Meridian employees have engaged in conduct that is harmful to the environment?..........3
Statement for inclusion in Meridian’s code of conduct which addresses environmentally
harmful practices.........................................................................................................................3
WEEK 7: GROUP 4........................................................................................................................4
Explaining the function of an External Auditor..........................................................................4
Discussing the benefit to shareholders of having the external auditor present at the AGM.......4
Drafting a term based on Principle 4.3 for inclusion in the enforceable undertaking.................5
WEEK 8: GROUP 3........................................................................................................................5
Explaining how companies are expected to handle confidential information.............................5
Discussing what companies should do to protect confidential information................................5
Recording three Meridian stakeholder groups that should be investigated to identify the leak of
the earnings information..............................................................................................................6
WEEK 9: GROUP 1........................................................................................................................7
Concept of board accountability..................................................................................................7
Principle 6 of ASX Corporate Governance and Recommendations............................................7
Three examples of shareholder rights..........................................................................................8
REFERENCES................................................................................................................................1

WEEK 5: GROUP 2
Tragedy of the commons
The tragedy of commons refers to the economic problem in which the individual is
having an incentive to consume resources but this expense will be at the expense of other
individual. It is the problem in economics which occurs under the situation when the individual
neglects or avoids the well-being of the society and the environment as a whole. This results into
overconsumption along with untimely depletion of the common resources. This tragedy for
commons occurs when the resources are scarce in nature in addition to the rivalry in
consumption and non-excludable (Murase and Baek, 2018). The solution to this tragedy of
commons involves the imposition of the private property rights, legal laws and regulations and
the development of the collective action plan. But these solutions are affected by the top-down
governmental control issues, as most of the time this process is privatized. It is basically
considered in association with the environmental issues like the sustainability. The commons
dilemma stands as a model which defines the variety of resource related issues like non-
renewable energy resources, water etc.
How Meridian employees have engaged in conduct that is harmful to the environment?
The employees of Meridian company are disregarding the negative impact of their
practices over the business functioning which turns out into difficult and complex situation for
the environment and the society. The employees while undertaking the task does not take into
account the project or idea proposed by them that would have any negative impact on
surrounding. This leads to making over utilization of the scarce resources in terms of
construction and development of the property. The employees are just interested in completing
the work as soon as possible at any cost which makes them disregard the code of conduct and
standards which the employees and the company needs to follow in order to carry out the
business operation effectively and consistently within the society.
Statement for inclusion in Meridian’s code of conduct which addresses environmentally harmful
practices
In order to mitigate the harmful practices which is being followed by the employees of
the company, there are certain laws which are needed to be complied with in order to reduce the
negative impact over the environment (Tragedy of The Commons. 2020). The environmental
protection law prohibits the organization from conducting operations if it causes pollution,

environment hazards, unreasonable noise or any sort of odour impacting the residential area.
Also, the company has adapted certain regulatory trends and positions which is favourable for
the company. This results into boosting the morale of the employees as they get to know that
their company is engaged into environmental friendly practices. The top management of the
company like the directors, senior executives and other senior managers are provided with
guidelines for complying fully with the environmental laws. The company has implemented
energy saving initiatives and the waste minimization practices for the well-being of the
environment.
WEEK 7: GROUP 4
Explaining the function of an External Auditor
The external auditors of a company play crucial role in validating the operations and
transactions of a company in respect of presenting true and fair view for the users of its financial
information. The financial statements are inspected by the auditors regarding the material
misstatements, errors in the calculations, fraudulent practices etc. The audit is undertaken in
respect of the statement of accounts, operations, systems and external relations. The major
function of the external auditor is to provide reasonable assurance to the stakeholders of the
company as to the fairness of the presented financial statements (Kassem and Higson, 2016).
They are not responsible to make changes in the misrepresentation but shall recommend changes
such as material misstatements so that the audited financial statements are free from any errors.
The roles and responsibilities are fulfilled in such a manner that the results are independent,
confidential, free from biases and presented to the best of knowledge of the auditors. The
working of audit in a firm must be carried with due diligence is another requirement of the
external auditors. The array of audit conducted does not limit to that of financial statements, the
external auditors are responsible for verifying and reviewing other departments as well and
checking out the compliance as to the governance, legal obligations and ethical code of conduct.
Discussing the benefit to shareholders of having the external auditor present at the AGM
The presence of the external auditor at the annual general meeting of the company proves to
be beneficial for the shareholders as they are not involved in the day to day operations of the
business and can get the valuable insights only through the opinion and reviews of the external
auditor who is free from biases and provides an independent result (He and et.al., 2017). The

shareholders can know that the financial statements that are prepared by the board and
management are providing the true and fair view of the business or not. The shareholders get
confidence as to transparency and accuracy of accounts with the presence of the external auditors
in the meetings. Apart from this, the shareholder has the mentality that with the presence of
auditor, the management shall perform better and in the interest of maximization of wealth of the
shareholders.
Drafting a term based on Principle 4.3 for inclusion in the enforceable undertaking
The inclusion of the stakeholders in the enforceable undertakings shall be governed in
accordance with the transparency, negotiability and accountability within a company. The
stakeholder’s opinion matters in the prosperity of the company and for that it has to ensure that
proper formal mechanism of decision-making is developed (Burt, 2016). It is also to be observed
that the stakeholders benefit is planned and optimized within the operations of the business. An
independent person must observe and review upon the compliance procedures that are followed
by the enforceable undertaking to satisfy its stakeholders.
WEEK 8: GROUP 3
Explaining how companies are expected to handle confidential information
The companies are expected to maintain the confidential information with utmost care such
that it should not be leaked outside the business organization. Some information that are shared
between the employer and the employees related to the business operations like the business
plans, marketing and promotional tools, cost benefit analysis, distributors etc. This information
once gone in the wrong hands shall spoil the profitability and future growth prospects of the
business (Massimino, Gray and Lan, 2018). The confidential information in the business should
be maintained with limited access to whom it is required and shall be interested in securing it.
The important data must be prevented from getting leaked by tight control and security in the
maintenance of the databases. The customer information should be prevented in the password
protected files so that unnecessarily leakages can be prevented and customer reliability and trust
ensured by the officials of the company.
Discussing what companies should do to protect confidential information

There are some necessary precautions that the company must undertake in order to retain and
protect the confidential information from leakages or the usage of unauthorized people. One of
the major steps that can ensure the confidentiality of the data is managing it over the electronic
platforms which is password protected and is accessible only by those who are authorized to do
so (Ten ways to protect your confidential information, 2021). Also, if some work is manually
done on the papers then it should be maintained in the safety deposits and once they are utilized
then must be destroyed using the shredders. Employee trainings is also a major contributor to
developing an understanding regarding maintaining confidentiality and its significance in the
organization. The awareness regarding this shall help employees maintain secrecy and follow
formal lines of communication. Mentioning the non-disclosure policy in the handbook of the
employees and the violation of such policy attracting stricter regulations from the management
of the company. This shall ensure more diligence and control from the side of the employees
which is beneficial for deriving results for the company. Also, confidentiality of the information
can be sustained under proper guidance and observation of the top-level management.
Recording three Meridian stakeholder groups that should be investigated to identify the leak of
the earnings information
In the case of leak related to the earning's information of the company the various
stakeholders who have access to the insider information are to be investigated to find out the
culprit amongst them. This information can be useful for the competitors of the business and can
steal the idea and ultimately the market share of the company. Employees are the stakeholders
who are generally responsible for the disclosing and leaking of the earning policy of the
company (Beck and et.al., 2016). As soon as an employee switches the company they shall be
breaking the confidentiality of that company and giving the useful information to the market. To
avoid this, exit interview must be conducted. Apart from them the suppliers of the company are
also many times responsible for leaking the costs at which company is acquiring its material.
Through this the customers get an idea of the profit-margin or the competitors attract supplier by
paying higher price which is ultimately loss for the company. The third stakeholder are the
customers who leak the information related to discounts and credit policy of the company. These

can be used by the competitors in the market to derive competitive advantage and generate future
growth prospects.
WEEK 9: GROUP 1
Concept of board accountability
The board accountability is about taking the responsibility pertaining to the organization's
activities and presenting it in a fair and understandable way which helps in evaluating the
position and prospects to stakeholders. In the listed companies, the board accountability is
systematic and organized and has to comply with all the guidelines under the Corporate
Governance Code. In the context of the corporate governance, the accountability of the Board of
Directors (BOD) is considered to be the major issue by the government, professional associations
and international authorities (Andrews, 2017). Boards are given significant power in the
companies which consequently argued that they need to be accountable for their actions. The
Board is responsible for providing relevant information about the business operation to the
stakeholders of the company. For doing this, transparency is the key, as by open, clear and
honest reporting will result into assisting the entity in building good relations with their
stakeholders which involves customers, employees, government and so forth. It is also important
that the directors perform their duties in good faith and in the way which serves the best interest
of the company and the shareholders and is responsible for paying attention to the meetings and
undertaking decision which is best for the entity and its investors but is accountable for all these
actions.
Principle 6 of ASX Corporate Governance and Recommendations
The principle 6 of the ASX corporate governance is in regard to respecting the rights of
the security holders. The principle states that the listed entity should respect the rights of the
security holders through the way of providing them with the relevant and appropriate
information and the facilities in order to allow them to exercise their rights as a security holder
(Safari, 2017). It involves providing them with ready access to the information, communication
openly and honestly and encouraging their participation. Following are the recommendations:
 A listed entity should provide relevant information pertaining to the company itself and
its governance to the investors through website.

 A listed entity should design and implement a program for the investor relation in order
to facilitate effective two-way communication with its investors (Kilian, 2019).
 A listed entity should disclose the policies and the processes it has in place in order to
facilitate and encourage participation at the meeting of security holders.
 The entity should also provide its security holders the option to receive and send
communication to entity and its security registry electronically.
Three examples of shareholder rights
Following are the examples of shareholder's right:
 Right to attend the shareholder’s meetings and vote: The shareholders of the listed entity
has the right to attend the meeting which is in regard to their interest and making vote on
the certain issues which will affect their position.
 Right to inspect the company's minute books and securities registers: The shareholders
can also access the books of minutes and security related register for gaining information
about the things which were covered in the meetings (Tran, Alphonse and Nguyen,
2017).
 Right to receive dividend: The shareholders also have the right to receive dividend which
is based on the performance of the company. In case of equity shareholders, the amount
or percentage of dividend is not fixed while for preference shareholders it is fixed.

REFERENCES
Books and journals
Beck, E. J. and et.al., 2016. Protecting the confidentiality and security of personal health
information in low-and middle-income countries in the era of SDGs and Big
Data. Global health action. 9(1). p.32089.
Burt, I., 2016. An understanding of the differences between internal and external auditors in
obtaining information about internal control weaknesses. Journal of management
accounting research. 28(3). pp.83-99.
He, X. and et.al., 2017. Do social ties between external auditors and audit committee members
affect audit quality?. The Accounting Review. 92(5). pp.61-87.
Kassem, R. and Higson, A. W., 2016. External auditors and corporate corruption: implications
for external audit regulators. Current Issues in Auditing. 10(1). pp.P1-P10.
Kilian, C. G., 2019. Good corporate governance principles and the probability of hate speech in
South Africa, Australia and Namibia. African Journal of International and Comparative
Law. 27(1). pp.161-169.
Massimino, B., Gray, J. V. and Lan, Y., 2018. On the inattention to digital confidentiality in
operations and supply chain research. Production and Operations Management. 27(8).
pp.1492-1515.
Murase, Y. and Baek, S. K., 2018. Seven rules to avoid the tragedy of the commons. Journal of
theoretical biology. 449. pp.94-102.
Safari, M., 2017. Board and audit committee effectiveness in the post-ASX Corporate
Governance Principles and Recommendations era. Managerial Finance.
Tran, Q. T., Alphonse, P. and Nguyen, X. M., 2017. Dividend policy: Shareholder rights and
creditor rights under the impact of the global financial crisis. Economic Modelling. 64.
pp.502-512.
Online
Andrews, E., 2017. Board accountability is a key element of strong corporate governance.
[Online]. Available Through:<https://www.grantthorntonni.com/news-centre/board-
accountability-is-a-key-element-of-strong-corporate-governance/>.
Ten ways to protect your confidential information. 2021. [Online.] Available through:
<https://www.theglobeandmail.com/report-on-business/small-business/sb-managing/
how-to-protect-your-confidential-information/article16072896/>
Tragedy of The Commons. 2020. [Online]. Available
Through:<https://www.investopedia.com/terms/t/tragedy-of-the-commons.asp>.
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