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Setting the benchmark in corporate integrity

Corporate Social Responsibility

CBN governor Lamido Sanusi ousted by president

The governor of the Central Bank of Nigeria (CBN), Lamido Sanusi, has had his tenure cut short by Nigerian President Goodluck Jonathan in what many believe to be a politically motivated attack. Sanusi has been a vocal critic of the Nigerian government’s failure to uphold best corporate governance practice, and his removal here coincides with his presenting evidence to parliament concerning Nigeria National Petroleum Corporation’s (NNPC) failure to pay $20bn in oil revenues.

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Arthur Lang: How corporate governance has affected Asia’s real estate market | CapitaLand | Video

Corporate governance is a major issue when it comes to Asia’s real estate industry. It has become increasingly important for companies operating within the sector to monitor and refine their processes, to reduce the chances of corruption and fraud, and maintain the trust of stakeholders. Corporate Governance Report spoke to Arthur Lang, CFO of CapitaLand – one of Asia’s largest real estate companies – to find out about their culture of compliance, and the challenges they face expanding their services in developing countries.

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Eurosif report calls for better ESG engagement

A new report has called for greater engagement between companies and their shareholders, insisting that better dialogue will lead to increased profits, reduced risk and improved reputations.

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A self-governing model

Sime Darby is a diversified Malaysian multinational involved in key growth sectors such as plantations, property, motors, industrial equipment, and energy and utilities. It operates in over 20 countries, employing more than 110,000 people, and has a large, diverse shareholder base.

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CapitaLand’s corporate courage

CapitaLand Limited, one of Asia’s largest real estate companies, is committed to building a sustainable future for its stakeholders and for generations to come. Headquartered and listed in Singapore, the company’s businesses in real estate and real estate fund management are focused on its core markets of Singapore and China.

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Poor governance: a tax on Russia’s innovative companies

A recent report undertaken by Sberbank Investment Research claims poor corporate governance amongst state-owned Russian enterprises is detrimental for private companies – likening the implicated costs of non-compliance to a tax on Russia’s NGOs. The impromptu report claims that non-compliance remains a principal concern for those investing in Russian equities, and must be rectified if Russia is to attract further investment.

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UAE discusses role of CSR in sustainable development

The UAE has hosted a forum that discussed the importance of philanthropy and responsible social contribution in creating a sustainable society within the region. Organised by the University Leadership Council of the UAE at Dubai’s Grand Millennium Hotel, the event saw leading businessmen and politicians discuss how the region could better enhance its CSR practices.

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FBI in criminal probe of “biased” tax agency

The announcement has come after weeks of allegations that the IRS may have unduly targeted conservative political groups for extra tax scrutiny. Attorney General Eric Holder gave the order for a criminal investigation to be launched by the FBI a mere four hours before an inspector general’s report over the IRS’ activity suggested the tax agency lacked oversight as it struggled to review hundreds of cases of advocacy groups claiming to be tax exempt. Most of the allegations date back to before the 2012 elections.

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First IATI annual report published

To outline the International Aid Transparency Initiative’s marked progress throughout the past year, the voluntary, multi-stakeholder initiative has, in April of this year, released its first annual report. The organisation, whose goal it is to improve governmental transparency in the spending of aid, details in the report for 130 organisations to be publishing data on the IATI open platform.

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EU’s proposed CSR rules split industry and NGOs

Disagreements between business groups and NGOs have caused another setback for the European Union’s ongoing attempts to make large corporations to strengthen their Corporate Social Responsibility (CSR) reporting.

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The many faces of auditing

Both mandatory and discretionary, auditing comes in many guises

1 Integrated

A necessary undertaking for public companies, an integrated audit entails the auditing of both financial statements and internal control over financial reporting. Necessarily conducted by an external auditor, integrated audits are advantageous in that they encourage a holistic approach to the internal auditing process.

2 Performance

Conducted by either an asset manager or an outside firm, a performance audit verifies performance figures with those demonstrated to the public. Beneficial in that a performance audit allows an accurate insight into a firm’s returns.

3 Quality

Quality audits entail the systematic examination of a quality system, undertaken by either an internal or external quality auditor. Quality audits are integral in determining compliance with a defined quality system process and are a necessary requirement in maintaining the ISO quality system standard.

4 Regular health checks

Regular health check audits are carried out for purposes in understanding the present state of a specific project. Primarily conducted by an independent party, regular health checks are intended to further increase productivity or otherwise effectiveness.

5 Energy

Energy audits consist of an inspection, survey and analysis of energy consumption. Largely intended for the bettering of energy conservation, input is often sought to be reduced though without the hindering of subsequent output. Energy audits are largely meant for reducing overheads.

6 Regulatory

Otherwise termed financial, regulatory audits are intended for assessing the legality of processes pertaining to financial operations. Encompassing management, collections and expenditure, regulatory audits seek to determine a true and fair representation of policy and financial management.

Community spirit

Research has shown that companies giving back to the communities in which they work tend to enjoy better long-term results

1 IBM

An organisation famed for valuing innovation and entrepreneurship, IBM helps its employees to give back to the community in the way they best see fit. IBM distributes Activity Kits, each one designed around different volunteering opportunities. For those who want to use their expertise to help educate others, there are kits advising on how to conduct workshops for adults who want to get into the industries IBM operates in. Employees wanting to inspire future generation can use kits to engage children in workshops that see students make anything from paper dog houses to solar-powered model cars. Or those who prefer a more hands-on approach they can volunteer to help in disaster zones.

2 Ford

According to Henry Ford, “A business that makes nothing but money is a poor business”. This inspired Ford’s Accelerated Action Day in 2012, which saw more than 600 employees in American branches step away from their desks to work in local community projects, supported by various charities. Volunteers were dispatched to shelters, schools and family centres, helping to clean, paint and build in their on-going renovation missions. Projects included renovating shelter rooms for the Salvation Army’s centre in Detroit, building houses with Habitat for Humanity and creating therapy rooms for children with the First Step Domestic Violence Program.

3 JP Morgan

JP Morgan engages in many community projects globally, but recent years have seen emphasise focused on improving education on both sides of the Atlantic. Last year they helped to fund Achieve Together, a drive to recruit and inspire good teachers in disadvantaged areas of the UK. The first phase of the programme will roll out later this year, estimating to help 8,000 pupils. 2010 saw the firm launch a $325m initiative to support publically-funded schools in the US. The company granted $50m to community-development financial institutions to support new schools, as well as helping to tackle the financial problems of schools that already have a strong academic track record to keep them afloat.

4 Coca-Cola

5by20 is Coca-Cola’s initiative to empower five million female entrepreneurs worldwide by 2020. The multinational aims to focus its efforts on the small businesses across the world, currently focusing on Brazil, South Africa, the Philippines and India, by providing training with financial resources and mentors to women looking to get ahead in business. Since launching the program in 2010, Coca-Cola claim to have economically enabled more than 131,000 women. As part of the program, a new initiative in Kenya has helped female farmers grow mangoes for locally sold fruit juices, which has in turn helped create sustainable livelihoods around the farms.

5 Johnson and Johnson

As part of Johnson and Johnson’s No More Tears brand’s 50th anniversary, its Clean Water Initiative was launched as a combined effort with non-profit charity Water for People. Operating under the slogan “Because every baby deserves clean water”, the program has aided small, rural communities in ten of world’s poorest countries, including Malawi and West Bengal to tackle water contamination. The charity not only educates communities but also installs sanitation facilities in schools to provide clean water to hundreds of thousands of children.

Corporate Governance Report interviews international migration expert Sophie Barrett-Brown on the value of immigrants to UK corporations

Keeping up with UK immigration rules | Sophie Barrett-Brown| Video

Corporate Governance Report interviews international migration expert Sophie Barrett-Brown on the value of immigrants to UK corporations

Corporate Governance Report interviews international migration expert Sophie Barrett-Brown on the value of immigrants to UK corporations

The value of immigrants to the UK economy | Video

Corporate Governance Report interviews international migration expert Sophie Barrett-Brown on the value of immigrants to UK corporations

Corporate Governance Report interviews CapitaLand CFO Arthur Lang on the impact of corporate governance on Asia's real estate industry and investment

Arthur Lang: How corporate governance has affected Asia’s real estate market | CapitaLand | Video

Corporate Governance Report interviews CapitaLand CFO Arthur Lang on the impact of corporate governance on Asia’s real estate industry and investment

News

Investors want sustainable reports to be more transparent

Survey finds that a vast majority of investors in Europe find sustainable reporting essential to their investment decisions

NSE establishes Corporate Governance Index

The NSE has partnered with the CBi in an attempt to offset perceptions of Nigerian capital markets being riddled with corruption

Should defined contributions be re-distributed?

Both the OECD and the House of Lords have criticised the now widely-used defined contributions plan for not accommodating adequate savings unless employees are high earners

Fed Res enhances internal auditing standards

The US Federal Reserve is strongly encouraging banks to consider their internal auditing strategies to avoid regulatory intervention

New corporate governance guidance published

The QCA has published a new guidance code for SMEs, focusing primarily on delivering long-term shareholder value

Mandatory auditor rotation unnecessary, says Canadian business institute

Calls to make rotation of auditing firm’s compulsory are rejected by Canada’s Institute of Corporate Directors

Notable reports

Some of the leading reportage in corporate governance

Churchill Mining grants 5.4 million share options

Following what many have perceived to be detrimental legal altercations through the past year, the London-listed mining company has since granted new share options to many of its employees

ASIC pushes ahead with annual report reforms

Australian regulator demands more information on strategy from public companies in their annual financial statements

The many faces of auditing

Both mandatory and discretionary, auditing comes in many guises

Community spirit

Research has shown that companies giving back to the communities in which they work tend to enjoy better long-term results

Reducing annual report clutter

The presence of clutter in an annual report actively detracts from its usefulness to both shareholder and investor alike

Wal-Mart review compliance amidst bribery allegations in Mexico

Following bribery allegations that cost the company over $157m, retail giant reviews compliance operations