Analysing Corporate Governance

Introduction:

Corporate governance refers to business process assisting a company to comply with the organisational regulation and principles in term of controlling, regulating and operating the overall business in effective manner. Here the study is going to discuss the corporate governance of the UK based famous sportswear company Sports Direct, with determining as well as analysing the issues faced by this company in term of conducting the effective corporate governance process. The study will also determine the relation of these issues with maintaining proper corporate governance system in the selected company. Finally, this study depicts the improvement strategies that the selected company will develop to deal with the corporate governance problems.

Identifying issues of Sports Direct:

According to Yermack (2017), corporate governance is important process that any organisation needs to maintain in its workplace in terms of maintaining the sustainability and well-organised business framework. Sports Direct, in the UK based Sports retailer selling wide ranges of sports related products for the women, men and kids. This company recentlty faces certain issues in terms of maintaining corporate governance in its organisation framework, which are accountability issues, ethical issues, transparency issues, conflict of interest and oversight issues. These issues make it difficult for this company to implement organisation policies and regulation in its workplace to make transparent, fair and highly organised business framework. Therefore, in term of coping with these issues, the Spots Direct needs to take effective strategies that will be relevant with the overall condition of the business.

Relation of the issues with corporate governance of Sports Direct:

Sports Direct face some issues to conduct proper corporate governance in the workplace, will pose adverse impact on the overall brand reputation and the productivity of the organisation. Transparency issued faced by Sports Direct will pose adverse impact on accuracy in the work process. As mentioned by Yermack (2017), not only the transparency issues but also there is accountability issue that makes the unfair practices and unethical process in the workplace which develop constraints in term of complying with the with the regulation a principle of the organisation. Sports Direct face accountability issues which is related to maintaining proper corporate governance in the workplace as it poses adverse impact on the accountability of staffs to the responsibilities and organisational gaols. In this aspect Jacoby (2018) mentioned that, conflict of interest is the anther important issues that is related to the corporate governance of any organisation. Sports Direct has staffs from different culture, ethnicity and background which creates the opinion mismatches and conflict among them that restrict the company to maintain systematic arrangement as well as implementation of organisational regulation.

Improvement of corporate governance:

For developing strong corporate governance framework and cope with the above issues, the selected company uses the 4 pillars of the corporate governance which are as follows:

• Accountability
• Fairness
• Responsibility
• Transparency

Through maintaining this process, the company will maintain strong governance system that will assist the staffs to cope up with any issues.

Conclusion:

The study concludes, corporate governance is important for any business to maintain well-organised framework in the workplace. In addition to this, corporate governance assist business to have proper organisational framework that will assist the company to grab competitive advantage and sustainability in the international market. In addition to this, with maintaining strong corporate governance in the workplace, organisational can cope up with any issues related to the organisational framework and market decisions.

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Reference list:

Hussain, N., Rigoni, U. and Orij, R.P., 2018. Corporate governance and sustainability performance: Analysis of triple bottom line performance. Journal of Business Ethics, 149(2), pp.411-432. Jacoby, S.M., 2018. The embedded corporation: Corporate governance and employment relations in Japan and the United States. Princeton University Press. McCahery, J.A., Sautner, Z. and Starks, L.T., 2016. Behind the scenes: The corporate governance preferences of institutional investors. The Journal of Finance, 71(6), pp.2905-2932. Minhas, R., 2019. Corporate, corporate governance and Institutions: a bibliographical review and agenda in context of asian “family” firms. Our Heritage, 67(10), pp.1541-1549. Schmidt, C. and Fahlenbrach, R., 2017. Do exogenous changes in passive institutional ownership affect corporate governance and firm value?. Journal of Financial Economics, 124(2), pp.285-306. Yermack, D., 2017. Corporate governance and blockchains. Review of Finance, 21(1), pp.7-31.