REA Group Corporate Governance: Ethics and Stakeholder Report

This report provides an analysis of REA Group Ltd's corporate governance and ethical practices, focusing on the company's strategic decisions, board composition, and stakeholder engagement. The report highlights REA Group's expansion strategies, including mergers and acquisitions, and their impact on the international property market. It examines the company's adherence to corporate governance principles, including board independence and transparency in financial reporting. The report also discusses the application of legitimacy theory in interpreting the company's communications and its efforts to maintain a positive public image. Furthermore, the report touches on the remuneration policies and the benefits provided to employees and shareholders, linking these practices to the overall effectiveness and sustainability of the company's operations and its commitment to ethical business conduct. This document is available on Desklib, where students can find a wide array of study resources, including past papers and solved assignments.

Running head: Corporate governance and ethics
CORPORATE GOVERNANCE AND ETHICS
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Corporate governance and ethics
Table of Contents
Executive summary....................................................................................................................2
Introduction................................................................................................................................3
Discussion..................................................................................................................................3
1. Introduce and summarise the company..................................................................................3
2. Summary of corporate governance at your company............................................................5
2.1 Composition of board.......................................................................................................5
2.2 Reports from Chairperson and CEO.................................................................................5
2.3 Remuneration report.........................................................................................................6
Base pay and benefits.................................................................................................................6
3. Board orientation....................................................................................................................7
4. Interpretation of company communications using Legitimacy Theory.................................7
Conclusion..................................................................................................................................9

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Executive summary
The REA Group of Companies have identified the fact that the year 2012 is the
benchmark of their performances. They have decided to purchase 100% stack of Casa.it Italy
in order to expand their business. The company is going to increase the development of the
whole resource development and through the increased level of communication, the company
is aiming to indulge expansion of footsteps in South East Asia and in the year 2016, the
company has acquired I Property group. Through this level of merge and acquisition, the
REA Group of company is going to expand their business in countries like Hong Kong. In
order to increase the expansion of the business in the international market, the company
needs to incorporate better utilisation of technologies.

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Corporate governance and ethics
Introduction
The main aim of this report is to identify the corporate government and the ethics that
REA group LTD is going to follow in order to increase the production rate of the company.
The Company is mainly aiming to increase their investment in the property markets and the
development of mobile application is going to increase the consumer demand from the
internal economy. The annual report is claiming the CEO statement that the company is
going to take in order to indulge better negativity that can be countered easily. The
application of resource and agency theory is important in the sense that through the
incorporation of these two theories, the REA group ltd is going to take so that they can thrive
more in the market. The main significance of the report is that the study will highlight the
importance of resource utilisation that are done by REA Company to induce better policies
that will increase the overall production level.
Discussion
1. Introduce and summarise the company
The company has started its journey from the Garage in the year 1995 and taking the
help of advanced level of internet and business technologies the company is making enough
improvement in the ground of property related industry. On the other hand, through the
incorporation of economic activities, the important source of revenue earned is that the
incompletion of accounting will infer better prove of the data.
In the year 2004, the company successfully raised almost 1 million of unique
customer visit to their websites regarding property related issues to the growth of the fund.
The year 2007, big success came for the company in the form of acquiring 59% of casa.it in
Italy and squarefoot.com.hk launched in Hong Kong.

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Corporate governance and ethics
The REA Group Ltd in the year 2018, earned a whooping amount of profit of about
USD 808.3 million. The company has successfully expanded jobs of about 500.. In the year
2017, the company had an Earnings before interest and tax of about 73.5% and in the year
2018, the company got EBIT of about 103.5%. From the annual report of the company it has
been seen that REA Group Ltd is mainly trying to focus more on the development of mobile
applications regarding their products so that number of customers can be increased. It is
important in the sense that through the development of resource driving technologies, the
company has brought significant changes in the property market of Australia (REA Group
Ltd, 2019). The labour expense of the company increased by 18% and the reason is that
company has invested even in Africa and doing business in a different name and has
successfully increased market share of 18% (REA Group Ltd, 2019). REA group is
expanding the level of the business by following list of merges and acquisitions of companies
in the form of casa.it in Italy and number of companies in Hong Kong in order to increase the
development of both their human and capital resources. Both the strategy of merger and
acquisition is important in the sense that through this strategy the REA Company is going to
expand their business in the international property market. This is an important aspect for the
companies investing in the property market is that other companies will also consider the
investment through internet in order to increase the overall rate of production that will
definitely going to increase their revenues (REA Group Ltd, 2019).
2. Summary of corporate governance at your company
2.1 Composition of board
As per the LOD that is List of objectives and deliverables, the REA Group Ltd must
have 50% of independent board members. The composition of the board should be done
mainly based on the improvement in the decision making abilities that the company is mainly
willing to incorporate the improvement in the accounting process. Through the use of

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Corporate governance and ethics
advanced level of technologies, the REA Group Ltd Company is mainly looking to increase
the use of better level of technologies so that they can give tough fight to its competitors in
terms of increased level of production level and maintaining the ethics at the same time. The
board members should be highly capable of forecasting the level of future investments. On
the other hand, REA Group Ltd is mainly looking to be one of the best company in the
property related markets of Australia. It is important for the company to bring those people in
the board who is continuously willing to bring investments in order to bring changes within
the company in order to increase the overall effectiveness of company. Big decision makers
should be independent and while taking any decisions that will be beneficial for the company
should be unbiased in nature.
2.2 Reports from Chairperson and CEO
Reports from chairperson and CEO claims the fact that in order to increase the
efficiency of the auditors’ reports, the company has taken the help of independent and neutral
auditors. Through the incorporation of effective and unbiased auditor report will help REA
Group Ltd to identify the gaps that are being found in the investment and expenditure data.
The balance sheet of company is going to increase the areas of investment that the company
is going to undertake. Most of the chairperson and CEO is going to identify the resource that
are mainly going to bring high benefits for the company. The report from the CEO and
Chairman claims that all the data and information and data that has been provided by them is
genuine and authentic in nature.

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Corporate governance and ethics
2.3 Remuneration report
The remuneration report of the company is mainly showing the fact of how much the
shareholders are getting from their investments. The remuneration report also claims the fact
that most of the shareholders is also getting high level of revenues from the shareholders. It is
an important in the sense that the remuneration is mainly going to incorporate the level of
bonus, superannuation benefits that the company is mainly being paid to the shareholders.
The remuneration is mainly going to identify the cash flow statement and the gaps that are
being found in the balance and income sheet of REA Group Ltd.
Base pay and benefits
The basic pay of the company is highlighting the fact that in order to indulge the
improvement is going to increase the amount of the superannuation and other benefits that are
being given to the employees. It is important aspects in the sense that in order to increase the
overall production level the role that is played by the stakeholders are increasing and is
significant. It is important for the whole company to deal mainly with important policies that
will definitely going to incorporate the development of better production ability and the
company will be willing to bring best of all the employees. For this reason, the plan to give
high benefits will obviously highlight the incorporation of better employment that will
automatically increase the overall investment to the company human resource. Through the
report of the company that has been published in the form of annual report will definitely
bring better amount of resources so that economy will be mainly aiming to get hold of better
level of incorporation of policies. Through the implementation of basic pay the REA group
ltd. Will definitely look to play better.
Better and basic pay is helpful for the development of spread of information
technology that will automatically increase the development of resources. In order to increase

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Corporate governance and ethics
the development of resources activities, the company will be looking to indulge better amount
of production level.
3. Board orientation
REA Group of Company will be able to increase the strength and weakness of the
company to indulge the improvement of the better technologies. The board orientation is
important for the company in the sense that it is important to identify the development of
overall level of resources. It is an important aspects in the sense that through the development
of better level of decision the company will be incorporating better amount of problem
solving methods that will definitely include the overall efficiency of the human and capital
resources. The importance of the board orientation is mainly lying on the incorporation of
improving the level of communication among the employees and the stakeholders so that the
company can influence the level of trade and commerce. Through the Incorporation of
effective technologies will automatically increase the level of production. Better composition
of board members will automatically increase the level of effective communication and better
technological integration.
The Rea group of company is one of the important company in the property related
market and the company is making huge success in developing the property demand that has
increased by huge margin in the last few years. The company is having a market
capitalisation of AU$10b. The company is owning 19% of the market share in the property
market. Through the incorporation of better technology and the introduction of mobile
application is going to increase the demand of the consumers.

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Corporate governance and ethics
Figure 1: The revenue and earnings of the company
(Source: St, 2019)
Another benefit the company is having is that most of the members of the board are
insiders that are capable of giving leadership and the signalling of the product. It is an
important aspect in the sense that taking decisions is important in crucial time of crisis. The
decision making abilities of the managers will increase the development of both human and
capital resources that will definitely increase the long run production ability of the company.
The general public is having about 19% stake in REA. The government is also investing
within the company regarding the property related matters. It is important for the company to
bring in better amount of investment opportunity to improve the overall efficiency level of
the company.
The board orientation is important for the company in the sense that if the company is
going to have better and highly skilled board members to take any kind of decision then the
development of overall decisions and the effectiveness of the decision is going to increase.
The REA is going to increase innovation in the level of investment that is going to increase
the overall demand of the economy from the mobile based application. Since the company is
investing in the many Asian countries thus it is highly important for the company to increase
the level of the stakeholders. This is an important aspects in the sense that through the
implementation of better communication based on Legitimacy theory is going to bring the

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Corporate governance and ethics
overall resource team to perform well. On the other hand through the increased level of the
communication, both the internal and external stakeholders will be able to communicate
within them. They can minimise the communication gap and proper board orientation are
required to identify tools of auditing that will indulge the development of resources. On the
other hand through the incorporation of better level of investment opportunities the company
will find better ways to invest more.
The main responsibility of the board orientation is to indulge the development of
skills and potentiality of the employees. This is an important aspect in the sense that it will be
looking to increase the development of human and capital resources. On the other hand,
through the incorporation of better auditing tools and technologies will indulge the
development of accounting process will improve the gap minimisation from the employees
and accounts department. Improvement in the economic and financial activities will not only
include the resource channelization and resource distribution. Through the incorporation of
better accounting of better team formation. Through the incorporation of accounting principle
the REA group Ltd. Is going to indulge better improvement in the overall accounting.
On the other hand, using the better auditing tools will increase the overall
compensation and the shareholder interest is going to indulge the improvement in the level of
economic activities that will increase the operational activities will definitely increase.
Through the incorporation of modern tools and technology the company is mainly going to
increase the effectiveness of stakeholders’ matrix that will automatically increase the overall
resource capability but will also indulge the investors to invest in better amount of FDI.
4. Interpretation of company communications using Legitimacy Theory
Using the legitimacy theory the REA group ltd is going to increase the level of the
communication among the stakeholders and other aspects of development. Through the

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Corporate governance and ethics
incorporation of better business accommodation, it is important for the company to increase
the development of resources. It is important in the sense that through the incorporation of
better production ability the company is mainly going to incorporate better human behaviour.
Bringing better level of production is highly correlated with efficient level of communication
and it is important aspects in the sense that through the improvisation of resource and training
development the company will be mainly aiming to increase the resource quality that will
pretty increase the overall consumption level.
This is important strategy that has been taken by the REA group in order to increase
the overall development of communication. Through the increased level of communication
and implementing legitimacy theory, the company is mainly going to indulge the level of
economic activities that has taken the form of better productivity. On the other hand, using
better level of communication and the overall legitimacy theory the REA group is going to
incorporate the equity and through the communication, the study will be mainly willing to
indulge the improvement of the communication level with the stakeholders. This is important
for the REA Group Ltd. To improve the overall level of investment and the CEO believes
that the company is going to grow further through better level of communication is important.
In order to grow and improve the company needs to indulge in better level of production
ability and in order to increase the development of financial and accounting impact will
definitely help in making better performances. Through the implementation of better resource
development the company is mainly going to increase both inner and outer level of
communication.

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Conclusion
The whole study has come to the conclusion that in order to increase the overall
performances of the company, the company is mainly focussing on the development of
balance and income sheets that are being equipped with the best and authentic data. Through
the incorporation of authentic data and the level of independent auditing will increase the
overall production ability of REA Group Ltd. On the other hand, the company is mainly
going to indulge better technologies that will not only bring the overall effectiveness of the
company in building and maintaining ethics but will also increase rate of production level.
However, it has been seen that in order to increase the incorporation of legitimacy theory, the
communication within the staff and shareholder will increase by huge margin. It is an
important aspects in the sense that through the development of resource development and
improved level of communication will bring more advanced level of the investment.

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