1. Introduction According to Tricker (2014), all corporate entities including profit oriented companies and not- for -profit organizations have to be governed and they need a governing body. In case of a company, the governing body is its board of directors. He further states that corporate governance is about the way power is exercised over corporate entities and it covers the activities of the board and its relationships with the shareholders or members, the managers as well as with the external auditors, regulators and other legitimate stakeholders. The term corporate governance is quite popular in modern business world. Corporate failure of international companies has raised a need for good governance practice in a corporate entity. …show more content…
2. Metcash Limited Metcash limited is an Australian public listed company which wholesales and distributes groceries, liquor and hardware products. Metcash predominantly operates in Australia with a small presence in New Zealand. The group employs approximately 6,300 staff. Metcash is listed on the Australian Securities Exchange under the code MTS (IBIS World 2016). According to Metcash website, its customers are mainly independent grocery and liquor stores, but also include hardware and automotive part stores, which operate under its brand names. The Metcash Group has three business pillars (1) Metcash Food and Grocery (IGA) (2) Australian Liquor Marketers (ALM) (3) Hardware (Mitre 10) 3. ASX Corporate Governance Council (CGC) Principles and Recommendations (guidelines) The ASX guidelines were issued in March 2003 following a number of corporate failures in Australia and overseas; such as the failures of HIH in Australia and Enron in the U.S. (Lama 2012). The key objective of the guidelines was to address concern about unacceptable corporate governance behavior and restore investor confidence (Gold 2006, cited in Lama …show more content…
Company’s strategic and business plans and guiding policies are reviewed and approved by the board. The task of day-to-day management of company affairs and initiation of strategy and policies implementation has been delegated to the CEO of the company and senior executives who work in accordance with board approved policies. The Remuneration Committee of the board reviews the annual performance of the CEO against certain set criteria. On a monthly the target plans of the CEO and other senior executives are reviewed on the basis of the progress they make. For the CEO, target plans have been set and agreed by the board whereas for senior executives it is done by the CEO (Metcash Annual Report