Essays on Corporate Governance - Executive Remuneration Practice at Tesco Case Study

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The paper "Corporate Governance - Executive Remuneration Practice at Tesco" is a perfect example of a business case study. The concept of corporate governance has been receiving increased attention in the current times than in the past. The increased focus on corporate governance has been sparked by increased stakeholder awareness and demand from the executives (Bourne 2012, p. 16). Additionally, the increased attention on this area has also been triggered by the many cases of corporate scandals that rock businesses. Conflict of interest in particular is one of the major corporate governance issues that have become common in companies today.

According to Walton, (2005, p. 2) a conflict of interest results when the managers or executives of a company decide to pursue self interest for personal gains instead of the interest of the company and its stakeholders. Tesco is one of the companies that have been riddled with corporate governance issues particularly those related to executive remuneration practices that conflicted with those of the stakeholders of the company. This essay will begin by summarizing the article reporting the conflict of interest as regards the remuneration practices adopted by Tesco executives.

It will proceed to discuss the corporate governance issues raised and explain why the issue has been raised in the media. Finally the paper will conclude by providing a brief summary of the issues raised and recommend the measures that need to be taken going forward. Tesco: Company Background Tesco is a leading British food retailer founded in 1929 in London. Since then, the company has never looked back and has experienced a huge growth over the years to become the third largest food retailer in the world (Reuters 2015).

Although the UK is Tesco’ s main market, the company has expanded its market reach over the years by entering into different emerging markets in South East Asia, the U. S. and Eastern Europe. Despite the stiff competition that Tesco faces from other giant food retailers, the company has maintained good profits over the year. However, the company’ s profits have been dwindling in the last few years a trend that has been a course of concern to the management (Reuters 2015).

References

Bourne, L 2012, Stakeholder relationship management: A maturity model for organisational implementation. Gower Publishing, Ltd, London.

Claessens, S 2004, Corporate governance and enforcement. World Bank Publications, New York, NY.

Dash, A. K 2012, "Media impact on corporate governance in India: a research agenda", Corporate Governance. The international journal of business in society, Vol. 12 Iss: 1, pp.89 – 100.

Dyck, A., Zingales, L 2002, The corporate governance role of the media, viewed 8 March 2015 http://sticerd.lse.ac.uk/dps/extra/zingales.pdf

Freeman, R. E., Harrison, J. S., & Wicks, A. C 2007, Managing for stakeholders: Survival, reputation, and success. Yale University Press, New York.

Goodley, S 2011, Tesco soothes shareholders but angers pig farmers. The Guardian 14 Jan. 2015, viewed 8 March 2016 http://www.theguardian.com/business/2011/jul/01/tesco-annual-meeting-bonuses

Gunay, S. G 2008, Corporate governance theory: A comparative analysis of stockholder and stakeholder governance models. iUniverse. Cambridge, MA.

Moore, D. A., Cain, D. M., Loewenstein, G., & Bazerman, M. H 2005, Conflicts of interest: challenges and solutions in business, law, medicine, and public policy. Cambridge University Press, Cambridge, MA.

Peters, A., & Handschin, L 2012, Conflict of interest in global, public and corporate governance. Cambridge University Press, Cambridge, MA.

Reuters. (2015). Tesco PLC (TSCO.L). Retrieved from http://www.reuters.com/finance/stocks/companyProfile?symbol=TSCO.L

Walton, J 2005, How to identify & to manage conflicts of interest. AICD, London.

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