Corporate Governance Project Abstract
Corporate Governance Project Abstract
Corporate Governance Project Abstract
FOR
Corporate Governance
Under the Supervision of: Dr. Sujata Bali
500022480
ROLL NO:
R760212065
ABSTRACT
Corporate governance broadly refers to the mechanisms, processes and relations by which
corporations are controlled and directed. Governance structures and principles identify the
distribution of rights and responsibilities among different participants in the corporation (such as
the board of directors, managers, shareholders, creditors, auditors, regulators, and
other stakeholders) and includes the rules and procedures for making decisions in corporate
affairs. Corporate governance includes the processes through which corporations' objectives are
set and pursued in the context of the social, regulatory and market environment. Governance
mechanisms include monitoring the actions, policies, practices, and decisions of corporations,
their agents, and affected stakeholders. Corporate governance practices are affected by attempts
to align the interests of stakeholders.
The Smith Report was a report on corporate governance submitted to the UK government in
2003. It was concerned with the independence of auditors in the wake of the collapse of Arthur
Andersen and the Enron scandal in the US in 2002. Its recommendations now form part of
the Combined Code on corporate governance, applicable through the Listing Rules for
the London Stock Exchange. It was substantially influenced by the views taken by the EU
Commission. One important point was that an auditor himself should look at whether a
company's corporate governance structure provides safeguards to preserve his own
independence. It proposed changes to provisions in the then Combined Code dealing with the
composition and role of the audit committee and its reporting to shareholders. The Smith report
included specimen terms of reference for an audit committee and an outline of the section to be
included in a companys annual report on the activities of the audit committee.
The project would adopt a historical approach by analyzing the circumstances and the need of
the requirement of Smith Report on Corporate Governance. Simultaneously, an analytical
approach would be adopted to thoroughly elucidate on the recommendations of this report and its
impact on UKs stand on Corporate Governance.
Key Words Smiths Report, Corporate Governance, United Kingdom
SYNOPSIS
STATEMENT OF PROBLEM The project deals with two main issues. The first is to analyze
the growth and development of the phenomenon of the Corporate Governance in the United
Kingdom. The second is to analyze the interpretation of the report by Smith on Corporate
Governance and trace its implementation in the UK Corporate system.
OBJECTIVE OF THE RESEARCH The main objective behind the research is to deduce the
need, emergence, interpretation and the impact of the Smith Committee Report o Corporate
Governance and whether it has succeeded to bring about a reform in the United Kingdom
Corporate system.
IDENTIFICATION OF ISSUES
system.
Qualitative Analysis It aims to analyze the basic concept of Corporate Governance in
https://www.frc.org.uk/Our-Work/Publications/Corporate-Governance/Guidance-onAudit-Committees-September-2012.aspx
http://www.accountingweb.co.uk/topic/financial-reporting/smith-report-auditcommittees-summary
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?
uri=OJ:L:2002:191:0022:0057:EN:PDF
http://www.ecgi.org/codes/documents/combined_code_final.pdf
https://frc.org.uk/FRC-Documents/FRC/Consultation-on-proposed-changes-to-Guidanceon-Au.aspx
https://frc.org.uk/corp_gov_pub_smith_report_2003.pdf
CHAPTERIZATION
Introduction
Growth and Development of Corporate Governance in the United Kingdom
The Smith Committee Report
Impact of the Report
Implementation of the Report
Current scenario in the United Kingdom
Critical Analysis
Conclusion
Bibliography