A Comprehensive Analysis of Tesco's Corporate Strategy and Governance

This report provides a comprehensive analysis of Tesco's corporate strategy and governance. It begins with an introduction to corporate governance and its significance, followed by a background study on Tesco. The report identifies problems faced by Tesco, such as issues related to accounting practices and employee concerns, and analyzes them using both primary and secondary data. A literature review supports the analysis, exploring various aspects of corporate strategy and governance. The report then critically reviews the research findings and offers recommendations and an action plan to address the identified issues. The aim is to improve Tesco's corporate culture and drive the company towards success by enhancing its corporate strategies and governance practices. The report also highlights the importance of ethical conduct, the role of the board of directors, and the significance of effective strategies in the face of globalization and competition. The project utilizes a Gantt chart to outline the activities and timescales involved in the research process.

CORPORATE STRATEGY

Table of Contents
INTRODUCTION...........................................................................................................................1
Background Study.......................................................................................................................1
Problem faced by Tesco..............................................................................................................3
Activities and timescales.............................................................................................................3
Literature Review.............................................................................................................................4
Discussion of the secondary and primary research undertaken.......................................................4
Primary Data...............................................................................................................................4
Secondary Data...........................................................................................................................9
Critical review of the results of the research.................................................................................10
Recommendation and Action Plan.................................................................................................13
Recommendation.......................................................................................................................13
Action Plan................................................................................................................................14
REFERENCES..............................................................................................................................16

INTRODUCTION
Corporate governance in strategic management refers to the set of internal rules and
policies that determine how a company is directed (Tricker and Tricker, 2015). In accordance
with this context, this project will cover the aspects of corporate strategies and governance of
Tesco. Tesco is Britain multinational grocery and general supermarket and merchandise retailer
with headquarters in Welwyn Garden City, Hertfordshire. With the help of literature review, the
project will critically analyse the aspects of corporate strategies and governance. Further, critical
review of primary and secondary data collected will be analysed in this research project.
Recommendations and suggestions will be provided to the management of Tesco, so that they
can improve their corporate strategies and governance.
Background Study
Corporate strategies encompasses a firm's corporate actions with the aim to achieve
company objectives and goals. The strategies are formulated by the top management of the
organisations for the growth and development of business operations. These strategies assist the
management of the organisations to tackle the future uncertainties and prevent risks (Mathur and
et.al., 2013). Further, these strategies are formulated with the aim to increase the market share
and growth. Corporate strategy and governance are the rules and regulations which are
formulated by the Board of Directors of companies. These policies, rules and code of conduct are
to followed by each and every person employed in the particular organisation. Corporate
governance is the system of rules, practices and processes by which a company is directed and
controlled.
Corporate governance essentially involves balancing the interests of a company's many
stakeholders, such as shareholders, management, customers, suppliers, financiers, government
and the community. Corporate governance and strategies are the framework on the basis of
which organisation conduct their business activities effectively and efficiently. Since corporate
governance also provides the framework for attaining a company's objectives, it encompasses
practically every sphere of management, from action plans and internal controls to performance
measurement and corporate disclosure (Filatotchev and Nakajima, 2014). In the era of
globalisation and competitions, organisations aim to sustain in the competitive world by
increasing their production capacities. Thus, corporates management needs to formulate effective
strategies and policies so that employees and employers work collectively in order to accomplish
1

desired goals and objectives of the organisation. Corporate governance has become a buzz word
in the business management field. Owners of businesses of all sizes are employing the concepts
of corporate governance to develop a strategic plan for operations.
This includes systems and procedures designed to structure authority, balance
responsibility and provide accountability to stakeholders at all levels. In essence, corporate
governance is about balancing profitability with sustainability. Tesco Corporation is an
international company with a strong reputation for providing quality products and services. The
code of conduct formulate in the organisation so that positive corporate culture can be made and
organisation can move on the path of success (Armstrong and et.al., 2015). Ethical conduct is
referred as the conduct which is morally correct and honourable. The aim of the organisation is
to increase their productivity and profitability by conducting their business activities ethically
and legally. Further, the board of directors of the organisation aim to create premises a better
place for both employees and employers. This will aid in eradication of conflicts and disputes
and organisation can move on the path of growth and development. The board of directors is the
primary direct stakeholder influencing corporate governance (Adamides, 2015).
Directors are elected by shareholders or appointed by other board members, and they
represent shareholders of the company. The board is tasked with making important decisions,
such as corporate officer appointments, executive compensation and dividend policy. In some
instances, board obligations stretch beyond financial optimization, when shareholder resolutions
call for certain social or environmental concerns to be prioritised (Honoré, Munari and de La
Potterie, 2015). Corporate strategies and corporate governance plays important role in the growth
and development of the organisation. In this aspect, it is the responsibility of the top management
and appropriate authority to formulate and implement effective and efficient strategies so that the
corporate culture of the organisation can be improved and company can drive on the path of
success.
Research Aim: To analyse the corporate strategy and governance of Tesco.
Objectives:
 To understand the significance of corporate strategy and governance for Tesco.
 To examine the code of conduct and code of ethics followed in Tesco.
 To investigate the problems and issues faced by the organisation in terms of corporate
strategy and governance.
2

 To recommend appropriate solutions to eliminate the problems.
Problem faced by Tesco
Tesco is one of the largest grocery and supermarket incorporating its business activities
across United Kingdom. The corporate governance and strategies of the organisation are
formulated by Board of Directors and chairperson of the company (ArAs, 2016). According to
the analysis of Financial Times Stock Exchange 100 index, Tesco held the last position in terms
of its corporate governance policies and strategies. The supermarket chain was brought down by
the lowest scores for accounting and audit practices that were largely a hangover from an
accounting scandal and a series of profit warnings in the past two years. Tesco present system of
corporate governance is not efficient and faced many criticisms in the market economy of United
Kingdom. The issues including misleading pricing tactics, not treating and considering
employees needs and concerns, not following the code of ethics and conducts, etc. Thus, it lead
to increase in conflicts and disputes in the organisation. Employees frequently got exasperated
and infuriated with the wrong treatment of their superiors and managers. This impacts on the
overall growth and development of the organisation. In this context, this report will analysed the
corporate governance and strategy of the organisation. The loopholes will be discovered by
analysing and interpreting the reviews of employees. Recommendations and suggestions will be
provided to the management of Tesco, so that the issues in corporate governance can be solved
and organisation can move the path of growth and development.
Activities and timescales
In the following project series of activities will be performed so that the goals and
objectives of the project can be accomplished. The series of activities can be explained with the
help of Gantt chart. The Gantt chart will help in describing the activities effectively and
efficiently and which is provided below:
Activity 1th
Week
2nd Week 3rd
We
ek
4th
Week
5th
Week
6th
Wee
k
8th
Wee
k
9th
Week
Research Aim
Reviewing
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Literarture
Finish Proposal
Design question
and pilot research
Carry out &
Record Research
Data Analysis and
Making Graphs
Literature Review
According to Lamberti and Noci (2012), Company needs to follow different types of
corporate strategies which helps to get higher performance and productivity in the world. To get
desired target in the world the must need to follow approaches of marketing. Corporate strategy
has vital role in the firm. It has positive and negative impact on the firm because sometimes it
gives advantages to an entity and sometimes that are not effective to get higher performance in a
world. Technologies are changing every day and the manger if the firm has a responsibility to
analysis the market condition and based on that they should take effective decisions. Corporate
strategy helps to give more profit to the company. Firm should use government policies which
helps to maintain employee relation and also helps to expand their business in the world. There
are different types of policies for the employee such as employment laws that helps to give
protection and security to an employee. Corporate strategy and governance helps to get higher
performance and productivity the world. Government policies are very helpful for an entity it
gives more profit to expand their business in a world.
However, in contrast to this, as per the views of Tricker and Tricker (2015) There are
different types of strategies to increase a firm performance and productivity in the world when
the company use the corporate approach the can face many problems in a firm such as related to
the employees, related to the policies. To solve the issues they need to follow appropriate plans
and stages. Management is responsible to follow appropriate and effective strategies and polices
that helps to give higher profit to a firm in the world. They also need to give effective
environment to the employees so that they can easily communicate with each other for the
4

problem. Corporate strategy gives more advantages to a company to get higher profit and desired
goal in the world. Sometimes conflicts can occur during the implementation of approach so the
manager needs to give effective policies and environment to an employee to work together.
Because this directly affect the firm performance in the world.
According to Mathur and et.al. (2013), Strategies of corporate must be understandable by
the employees then only they can innovate a product and get higher performance in the world.
Sometimes during the implementation of corporate strategy in the firm, employees and
management faces some barriers that directly affect the firm overall performance in the world.
By using the corporate strategy in an entity they can get desired target and objective of a
company in the world. There are different types of government policies that helps to give more
efficiency to a firm and also helps to expand their business in the world. Government policies
must be effective and efficiency for the employee than only they can get desired goal in a world.
Government also gives appropriate policies to the employee and the companies that helps to get
higher performance in an industry.
However, in contrast to this, as per the views of Kim (2015), Company manager ha s
responsibility give essential resources to the employee to produce innovative products. There are
different types of cooperate strategies that helps to get desire target and higher performance in
the world. By using advanced approaches of corporate firm can easily get higher productivity in
an industry. Manager needs to give appropriate, effective training and development to the
employee to use strategies for the change. Corporate strategies helps to expand their business in
the world and helps to get higher performance in a world. Manager needs to find out the
direction of a corporation in which different business operations work together to get specific
objective. According the target, manager needs to give training and development to the
employees. There are different types of government policies that helps to give protection and
also help to get higher performance in a world. By using the governance company can easily
maintain employee relation in an entity and it has positive impact on the firm overall
performance. Governance has positive impact on the firm because it provides the way to increase
their performance and they can easily expand their business in the world. By using corporate
approaches in an entity, it gives more advantages and enhancement to the firm. Company must
need to follow the government policies that gives the way to increase performance and they can
also expand their enterprise in the world. Corporate strategy and governance has vital roles in the
5

company and it gives more advantages to an entity to maintain the brand recognition and to get
higher performance.
According to Steyn (2012), code of conduct and code of ethics are most essential for the
company. Manger needs to follow this documents that gives higher efficiency to the firm. Code
of conduct is the document which is issued by the board of director. It includes essential norms,
rues, regulations and responsibilities. Every firm use the document to maintain employee relation
and also increase the efficiency of work. It also includes the different types of rules ns regulation
for the employees and they need to follow in a company. This document guides and instruct an
employee in the firm to work together. By working together an entity can easily get higher
performance and productivity in the world. Code of ethics is the document that is created by the
top level management which includes the set of principles and designed to instruct a member of
the company to find out business integrity. There are different types of policies that helps to take
appropriate decisions based on the current situation. Both factors are helps to take effective
decisions and also helps to maintain employee relation in the company. Those documents helps
to give a way to behavior and work in an entity. Code of ethics gives the way and guide to the
management to solve specific problem and take effective decision.
However, in contrast to this, as per the views of Pantano (2014), Code of conduct and
code of ethics must be effective and well managed because based on that only employees will
behave in the firm. There are different types of instructions and guidelines that helps to take
appropriate decisions based on the situations. Theses documents helps to get higher performance
in the world and also maintain relationship between the employees. Code of conduct contains
the rules and regulations that employee needs to follow in the company. This document is issued
by the board of director and it contains the norms and policies. Code of ethics has different types
of policies and instructions that helps to take effective decision for the specific situation.
Sometimes various conflicts can occur so that a manager can easily find out the solution to solve
them. Employees faces different types of problems that has negative impact on the company
performance. Top level management gives an appropriate information and policies which helps
to get desired target and higher performance in the world. In companies there are various set of
rules and regulations which helps to maintain employee relation and gives the way to work
together ion s firm. It helps to expand their business in the world. Management has a
responsibility to provide appropriate and effective polices to the employee so that the can easily
6

work together to get desired target. Some times in an entity they face different types of problems
in the market so they can easily take decision that gives more advantages to the company. Top
level management has a responsibility to create those policies, rules and regulations that must be
beneficial for them. By setting effective plans and policies for the employees they will give more
effort to get desire target of a firm in the world. Rules and regulations must be effective and
efficient so that it give more profit to maintain employee relation and also helps to get higher
performance in a world. From code of ethics company can easily get the way to solve any types
of problem that occur in an entity. It provides the way to increase overall firm performance and
productivity in the world. Code of ethics gives the way to solve the particular problem and also
help to take effective decision. It helps to get higher performance and productivity in the world.
According to Park (2014), sometimes companies face different types of issues related to
the corporate strategy and governance. Organizations follows various approaches that helps to
get higher performance and productivity in the world. Employees facing barriers during the
implementation of the strategy. Manager needs to give appropriate environment to the employee
so that the can easily innovate their products and also maintain employee relation in an entity.
There are different types of issues such as employee relation, lack of knowledge, employment
laws etc. These all are the barriers that employee can face during the implement the corporate
strategy. To manage the works and relation the manager needs to give appropriate and open
environment to the employee so that the can easily communicate with each other to get desired
target in an entity. One of the big problem is that the employees have lack of knowledge to
implement the strategy to increase overall performance in the world.
However, in contrast to this, as per the views of Adamides (2015), employees have the
issues during the implementation of the corporate strategy in the firm. Manager has a
responsibility to give appropriate and open environment to the employees so that they can easily
communicate with each other and also give ideas to get desire objective of an entity in the world.
Major issue is occurred in the firms the employee relation. To maintain employee relation in an
entity a manager needs to give appropriate environment so that they can easily give their own
ideas and suggestions for the specific problem. By involving an employee in the decision-making
procedure so that they feel motivated and then they will give more contribution to get desired
target in the world. To solve the conflict in an entity, firm need to follow appropriate process that
gives the way to solve them. There are different types of plans and policies that helps to maintain
7

relationship between the employees in the company. There are various government policies that
helps to solve the conflict and also helps to expand their business in the world. To solve an issue
related to the corporate strategy manger needs to take appropriate decision based on the current
situation. Companies follows different types of policies and plans which helps to get higher
performance and productivity in the world. To solve any conflict in the company the need to take
appropriate decision and stages of solutions. There are different types of problems that can be
easily solved by the company.
According to Filatotchev and Nakajima (2014), These all are the problems that can occur
in the company, it directly affects the firm performance and productivity in the world.
Government policy must be good and efficiency for the employee that helps to maintain
employee relation and give higher protection to the employee. Sometimes company are not
following those plans and policies which give more benefit to the employee so that it can create
conflict for an employee in the company. Employment laws gives more advantages to the
employee and it gives higher security sand protection to an employee.
However, in contrast to this, as per the views of Armstrong and et.al. (2015), There are
various approaches and strategies that helps to solve appropriate conflict in a firm. One of the
major conflict can occur when entity use the corporate strategy in the company is the employee
relation. To maintain employee relations in the company manager has a responsibility to provide
open environment and also give appropriate policies to them. It helps to get desired target and
also helps to get higher performance in the world. Company use those plans and policies for an
employee that are beneficial for them such as employment laws, policies etc. corporate strategy
helps to increase the firm performance and also helps to expand their business in the world.
Discussion of the secondary and primary research undertaken
Primary Data
The primary data of the research has been collected via questionnaire form. The questionnaire
has been provided to all the employees working in all the departments of Tesco out of which 30
responses has been taken as sample. The interpretation of primary data is in thematic form and is
provided below:
Theme 1: Corporate governance and corporate strategies are important for the organisation.
8

Is corporate governance and corporate strategies are important for the
organisation?
Frequency
Yes 21
No 3
Don't Know 6
Interpretation: In the questionnaire survey conducted in the premises of Tesco, the question has
been asked to all the employees regarding the importance of corporate governance and corporate
strategies to the organisation. In the sample of 30 employees, 21 agreed that corporate
governance and corporate strategies are important for the organisation. 3 employee did not
agreed with the statement and voted no whereas 6 employees doesn't know whether corporate
governance and corporate strategies are important for the organisation or not. This implies that
corporate governance and strategies are very important and essential for the organisations.
Theme 2: Management of Tesco does not follow the code of conduct in the premises.
Is Tesco management completely follows the code of conduct in the premises? Frequency
Yes 12
No 15
Don't Know 3
9
Yes No Don't Know
0
5
10
15
20
25 21
3
6

Interpretation: In the questionnaire survey conducted in the premises of Tesco, the question has
been asked to all the employees in order to acquire information about the following of code of
conducts and ethics in the premises. From the sample of 30 employees, 12 employees accepts
that code of conduct has been followed in the premises of Tesco. 15 employees did not agree
with the statement and their response was no. Further, 3 employees have no idea whether, code
of conduct has been following in the organisation or not. This implies that the code of conduct
and corporate governance has not been following in the organisation.
Theme 3: Issues faced with the company's policies and procedures in respect to
implementation of strategies.
Do you face issues with the company's policies and procedures in respect to
implementation of strategies?
Frequency
Yes 18
No 10
Don't Know 2
10
Yes No Don't Know
0
2
4
6
8
10
12
14
16 12
15
3

Interpretation: In the questionnaire survey conducted in the premises of Tesco, the question has
been asked to all the employees regarding the issues faced by the employees regarding the
policies and procedures to implementation of strategies. From the sample of 30 employees, 18
employees voted yes as they find one or more issues with the policies and procedures of the
organisation. 10 people voted no as they did not find any issues with policies and procedures in
respect to implementation of strategies. Further, 2 employees have no idea whether they face any
issues or not. This implies that majority of employees in the organisation faced one or more
issues regarding implementation of policies and procedures of corporate strategies.
Theme 4: The corporate strategy of the organisation is not effective.
Is the corporate strategy of the organisation is effective? Frequency
Yes 15
No 17
Don't Know 3
11
12
15
3
Yes
No
Don't Know

Interpretation: In the questionnaire survey conducted in the premises of Tesco, the question has
been asked to all the employees in order to gather the information about the effectiveness of
corporate strategy of Tesco. From the sample of collected, 15 employees agreed with the
statement and voted yes, as they find the corporate strategy of Tesco is effective enough in order
to sustain in the competitive environment. 17 employees response was opposite, as they don't
agree with the statement. They find that the corporate strategy of Tesco is not effective enough in
order to sustain in competitive environment. Further, 3 employees have no idea about the
effectiveness of corporate strategies of Tesco.
Theme 5: Corporate governance of Tesco have negative impact on coordination level that is
observed among employees at workplace.
Does corporate governance of Tesco have negative impact on coordination level
that is observed among employees at workplace?
Frequency
Yes 16
No 12
Don't Know 2
12
Yes No Don't Know
0
2
4
6
8
10
12
14
16
18 15
17
3

Interpretation: In the questionnaire survey conducted in the premises of Tesco, the question has
been asked to all the employees regarding the impact on coordination level that is observed
among employees at workplace. From the sample of reviews of 30 employees, 16 employees
voted yes, the corporate governance and policies of Tesco negatively impact on the coordination
level in the organisation. 12 employees responses was opposite as they did not agreed with the
statement. 2 employees were not sure about the negative impact on the coordination level that is
observed among employees at workplace. This implies that majority of employees have negative
impact on the coordination level due to ineffective corporate governance policies.
Theme 6: Management of Tesco needs to take strict action against the culprit.
How would you recommend the management of Tesco to improve their corporate
governance and strategies?
Frequency
Appointing competent chairperson 5
Build skill based board 8
Ensure the directors have information they need 3
Strict action against culprit 14
13
Yes
No
Don't Know
0 2 4 6 8 10 12 14 16
16
12
2

Interpretation: In the questionnaire survey conducted in the premises of Tesco, the question has
been asked to all the employees of Tesco about the recommendation they want to give to the
management in order to improve the effectiveness of corporate governance in the organisation.
From the sample of 30 employees, 14 employees agreed with punishing the victim or culprit who
breaks laws and policies of the organisation. 5 employees said that appointing competent
chairperson will helps in improving the effectiveness of corporate governance. 8 employees said
that building skill based board will help the management to improve the effectiveness of
corporate governance. 3 employees agreed with the statement that directors have adequate
information about the corporate governance.
Secondary Data
The secondary data has been collected from various sources like books, journals, internet
articles and magazines. From the analysis of secondary data, it was identified that the corporate
governance and corporate strategies of Tesco is not effective and reputation of the organisation is
degrading day by day. The articles on internet describes that Tesco corporate governance drags
the organisation in the lowest position on the FTSE 100 firms (Farrell, 2016). This implies that
management of the organisation needs to focus and rebuild their corporate strategies and
governance in order to sustain in the market position.
14
5
8
3
14
Appointing competent
chairperson
Build skill based board
Ensure the directors
have information they
need
Strict action against
culprit

Critical review of the results of the research
In this part of the research project, critical analysis will be made on the basis of data
collected from both primary and secondary sources. This will help the researcher to comprehend
and understand the survey questions and reviews of other authors and researchers. In the
questionnaire survey conducted in the premises of Tesco, the question has been asked to all the
employees regarding the importance of corporate governance and corporate strategies to the
organisation. After analysing the responses of employees it was identified that majority of
employees believe the corporate governance and corporate strategies are very important for the
organisation. Corporate governance is the framework which is composed of policies and
regulations which are mandatory for the employees and employers to follow. This will promote
equality, growth and justice in the organisation.
Employees feels that corporate governance and strategies are essential part of the
organisation. On the basis of corporate strategies, the management of Tesco aims to sustain in
the competitive environment of United Kingdom. Another question in the questionnaire was
about following code of conduct and code of ethics in the office premises. In this context,
majority of employees response was against the questions. According to their response, the
management and employers of Tesco, does not follow code of conducts and code of ethics in the
organisation. This leads to increases in frequent conflicts and clashes between the employees and
employers. Further, some of the policies of the organisation mislead the employees and exploits
their rights. Thus, it degrading the brand reputation of the organisation. It is very essential for the
company to follow code of conducts in their premises. This will increase the environment of trust
and harmony, further will aid in increasing the motivation and loyalty of the employees.
According to the analysis of primary data, it was identified that employees of Tesco,
faced various issues regarding the policies and procedure of implementing corporate strategies.
Corporate strategies are formulated, implemented and transformed time to time, so that
organisation can improve their productivity and profitability. It is the responsibility of the top
management of Tesco to articulate and communicate the information about the strategies and
transformations. This will aid in eliminating confusion and doubts regarding the work. The
response of employees indicates that the management of Tesco does not communicate effectively
with the employees. Employees remain unknown about the recent changes in corporate strategies
15

and thus, it leads to increase in confusion and chaos. Employees faced ample of issues which
leads to degradation of the productivity and profitability of the organisation.
It is very important and essential for an organisation to have effective and efficient
corporate strategy. After analysing the responses of employees working at Tesco, it was
identified that majority of employees found that the corporate strategy of the organisation is not
effective. The policies and procedures are misleading and inappropriate. This impacts on the
reputation and goodwill of the organisation. In order to sustain in competitive environment, the
management of Tesco, needs to formulate and implement precies strategies. This will aid the
management to improve their efficiency and leads the organisation towards growth and
development. Further, it will aid in promulgating the motivation and determination level of
employees. It is very important for the organisation to established appropriate corporate
strategies that will promote development and success of the organisation.
After analysing the questionnaire and responses of employees, it was identified that corporate
governance of Tesco have negative impact on coordination level that is observed among
employees at workplace. The policies and regulations formulated and stated in the code of
conduct of Tesco is not efficient enough. From the responses of employees, it can be contends
that employers does not follow the code of conduct or code of ethics in the organisation, which
impacts negatively on the psychology of employees and hence they were unable to collaborate or
coordinate with their superiors effectively and efficiently. Corporate governance in the
organisation is formulated so that management can conduct their business activities ethically and
legally. Corporate governance is the system of rules, practices and processes by which a
company is directed and controlled. Corporate governance essentially involves balancing the
interests of a company's many stakeholders, such as shareholders, management, customers,
suppliers, financiers, government and the community. Corporate governance and strategies are
the framework on the basis of which organisation conduct their business activities effectively
and efficiently.
Strive for continuous improvement instead of perfections. The quote stated that an
individual or organisation or any entity must focus on continuous improvements. In this context,
the question has been asked to the employees working at Tesco about their recommendations and
suggestions to improve the structure of corporate governance and strategies of the organisation.
Employees suggested that appointing skilled and competent chairperson will help the
16

organisation to improve their corporate strategies and governance. It will impact positively on
the organisation. Some employees recommended that building skill based board will assist the
organisation and the management to improve their corporate strategies and governance. Further,
some of the employees recommended that board of directors of sufficient information they
require. This will help them to make transformations accordingly. After analysing the whole
questionnaire, it was identified that majority of employees recommends the management to take
strict actions against the culprit or victim who breaks the rules and regulations of the
organisation. Thus, in order to improve the corporate strategies and corporate governance, the
management of Tesco needs to consider the recommendations provided by the employees. This
will not only aid in increasing the productivity and profitability of the organisation, but also
guarantees their future success.
From the analysis of the secondary data collected from sources like newspaper,
magazines, internet, Tesco website, books and journal articles, it was identified that the corporate
governance of Tesco code of conduct formulate in the organisation so that positive corporate
culture can be made and organisation can move on the path of success. From the analysis of
internet articles, it was identified that Tesco ranks the lowest in terms of their corporate
governance and ethical structure (Farrell, 2016). Tesco indulges in many activities which were
unethical and harms the image and goodwill of the company. This includes providing misleading
price information to customers, accounts and audit scandals, inappropriate treatment with
employees, not following laws and legislations, etc. Authors and researchers contends that the
internal environment of the organisation is not appropriate and there is no complain culture
follows in the organisation. Employees threatened to improve their performance and employers
misuse their powers. This implies that the corporate governance of the organisation is not
effective and efficient and impacts on the employee relations and market reputation of the
organisation. Thus, in order to improve the corporate governance of the organisation
management must focus on their past and present records and then make transformations
accordingly. This will impacts on the corporate culture of Tesco, and employees satisfaction and
motivation will automatically increase.
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Recommendation and Action Plan
Recommendation
The recommendations to address the issues and eliminate the problems faced by Tesco in regards
with corporate strategies and governance are listed below: Recognise that good governance is not just about compliance: Board of Tesco needs to
balance compliance with legislation, regulation and codes of practice with performance
of the organisation through corporate strategy formulation and policy making (Tricker
and Tricker, 2015). In this process, the management of Tesco needs to elaborate its
position and comprehending major functions it will perform. Clarify the board's role in strategy: It is generally accepted today that the board has a
significant role to play in the formulation and adoption of the organisation’s strategic
direction. Thus, in order to improve the corporate governance and strategy of the
organisation, the management must clarify the role that board will going to play in
formulation and implementation of strategies. Monitor organisational performance: Monitoring organisational performance is an
essential board function and ensuring legal compliance is a major aspect of the board’s
monitoring role (Mathur and et.al., 2013). By monitoring and supervising the overall
performance of the organisation, the board will able to improve the corporate governance
and corporate strategies of Tesco. Thus, it is recommended to the management of the
organisation to frequently monitor the performance of the organisation so that it will able
increase its reputation. Understand the employee behaviour: Employee behaviour plays essential and important
role in the organisational success. It is very important for the management and board to
increase the satisfaction of employees by transforming their policies by considering
employees needs and expectation. Further, involving employees while formulating
corporate strategies will also help the management of Tesco to move forward on the path
of growth and development. Thus, it is recommended to the management of the
organisation to understand the behaviour of employees.
 Providing information to the directors: Board of directors plays vital role in formulation
and implementation of corporates governance policies and strategies. Thus, they must
have full and detailed information about the organisation (Top Ten Steps to Improving
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Corporate Governance, 2017). Thus, it is recommended to the management of Tesco, to
provide full and recent information about the organisation culture and structure so that
they can transformed the code of conducts accordingly.
Action Plan
The seven step of action plan will assist the management of Tesco in order to work on the
issues and problems regarding corporate strategies and governance is provided below: Define the problem: The first step of action plan is defining the problem (Filatotchev and
Nakajima, 2014). In this step, the management of Tesco needs to identify the issues and
problems which concerns them. This will help them to generate and acquire effective
information. Collect and analyse the data: The second step of the action plan is to collect and analyse
the data and information. This will assist the management to comprehend the nature and
type of problem and they will able to work on the problem effectively and efficiently. Clarify and prioritise problem: The third step of action plan is clarifying and prioritising
the problem. In this process, management needs to identify the degree of issues and
prioritise them accordingly. This will aid the management of the organisation to work on
the problem effectively. Write a goal statement for each solution: The fourth step of action plan is to write a goal
statement for each solution discovered and formulated. On the basis of goal statement,
the management of Tesco will able to eliminate the issue and problem. Implementing solution: In the fifth step of the action plan, the management of Tesco
needs to implement the derived solution and observe its results. Implementing solutions
and gathering information about the solution will help the management of Tesco to
comprehend the solution. Monitor and evaluate: The sixth step of action plan is to monitor the solution through
observations and feedbacks (Armstrong and et.al., 2015). Evaluating the solution on the
basis of managers observations and feedbacks will help the management of Tesco to
eliminate the problem.
 Follow Up: The last and seventh step of action plan is to follow up the implemented
solution. The solution needs to be communicated with all the employees and line
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managers so that they can work collectively and collaboratively in order to eliminate the
problem effectively and efficiently.
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