limited companies’ compliance with codes of corporate governance

Assessment Brief

Module Name: Corporate Governance

Module Code	Level	Credit Value	Module Leader
ACC3017	6	20	Dr Stuart Farquhar

Assessment title:	ES1: Essay
Weighting:	50%
Submission dates:	Monday 18th January 2021
Feedback and Grades due:	Please see NILE under Assessment Information

Please read this assessment brief in its entirety before starting work on the Assessment Task.

The Assessment Task

The assessment focuses on limited companies’ compliance with codes of corporate governance.

As a risk and compliance analyst, you have been asked to complete a review of a company listed on the FTSE100 index as of September 2020 as it complies with the 2018 UK Code of Corporate Governance. Your company will be allocated to you in the first two weeks of the module and the list will be added to the NILE site. Each student will be allocated a different company. During the module you will be able to and expected to use your company in class activities both individually and in small groups with your peers to help you develop your understanding of the requirements of the assessment. To undertake the assessment, you will need to obtain/download a copy of your company’s most recent annual report (2019 or 2020) within which there will be a section on Governance. This is the pertinent section of the report with which you will need to become very familiar.

Using your company’s corporate governance report, critically review the compliance of your company based on the following criteria:

1. Discuss the firm’s relationships with its stakeholders: Assess the extent of the company communications with stakeholders in terms of culture, company’s purpose, values, and strategy. Justify if the compliance to code requirements is evidenced. In the implications section, drawing on academic theory and evidence, critically evaluate whether your company’s approach is effective. (Approximately 200 words)

The answers should be structured as follows:

Company purpose and communication with shareholders	Approach and Justification Did the company comply with the code? Explain and justify (using evidence from the company report and the code)	Implications Drawing on academic theory and empirical evidence, critically evaluate whether your company’s approach is effective.
Communication with stakeholders (Culture, purpose and strategy

2. A. Evaluate your company’s approach to ensuring effective leadership as suggested by the UK Code of Corporate Governance. Does the company have a separate CEO-Chair or CEO-Chair Duality? Using academic theory justify the approach of your company. In the implications section, drawing on academic theory and evidence critically evaluate whether the separation of CEO-chair is important to financial performance. (Approximately 200 words)

The answers should be structured as follows:

Board Characteristics	Approach and Justification Did the company comply with the code? Explain (using evidence from the company report and the code) and justify (using academic theory)	Implications Drawing on academic theory and evidence critically evaluate whether the separation of CEO-chair is important to firm performance.
Separated Roles of CEO/Chair Yes/No

2. B. Discuss the extent of your company’s compliance with the requirements for board independence? In the implications section, using academic theory and evidence critically appraise the importance of independence on board performance. (Approximately 200 words)

The answers should be structured as follows:

Board Characteristics	Approach and Justification Did the company comply with the code? Explain (using evidence from the company report and the code) and justify (using academic theory).	Implications Using academic theory and empirical evidence critically appraise the importance of board independence on board performance.
Independence Proportion of independent board members

3. Assess your company’s adherence to the composition, succession, and evaluation principles, by critically assessing the extent of your company’s compliance to board evaluation. In the implications section, drawing on empirical evidence in the academic literature appraise the importance of board evaluation on improving board effectiveness and company financial performance. Review your company’s case based on your analysis. (Approximately 300 words)

The answers should be structured as follows:

Accountability Components	Approach and Justification Did the company comply with the code? Explain and justify (using evidence from the company report and the code).	Implications Using empirical evidence in the academic literature appraise the importance of board evaluation on improving board effectiveness and company financial performance. Review your company’s case based on your analysis.
Board Evaluation How often does the board undertake an evaluation of the board? Is there an external evaluation? Yes/No

4. Investigate your company’s approach to audit, risk, and internal control by examining its compliance to external auditor rotations. In the implications section, using academic theory and empirical evidence critically discuss the importance of external auditor rotation/independence on company exposure to risk. Drawing on the findings from the academic literature, evaluate the case of your company. (Approximately 300 words)

The answers should be structured as follows:

Accountability Components	Approach and Justification Did the company comply with the code? Explain and justify (using evidence from the company report and the code).	Implications Using academic theory and empirical evidence critically discuss the importance of external auditor rotation/independence on company exposure to risk. Drawing on the findings from the academic literature, evaluate the case of your company.
External Auditors Who are the auditors of your company? How long have they been the auditors? How many years is their contract?

5. Detail the structure of remuneration for the CEO for the past two years (either 2020 and 2019 OR 2019 and 2018) in terms of the proportion of total remuneration/pay for each of the following elements: Fixed Pay (includes Salary, benefits & pension); Annual Bonus; Long-erm Incentive Plan (LTIP). Explain the approach to remuneration and using academic theory justify the approach taken by the company. In the implications section, compare and contrast the relationship between remuneration and firm performance with the empirical evidence in the academic literature. Which of the three theories (agency, managerial entrenchment/power, and institutional theory) best explains your company’s approach? (Approximately 400 words)

The answers should be structure as follows:

Remuneration Components	Approach and Justification Explain the approach to remuneration and using academic theory justify the approach taken by the company.	Implications Compare and contrast the relationship between remuneration and firm performance with the empirical evidence in the academic literature. Which of the three theories (agency, managerial entrenchment/power, and institutional theory) best explains your company’s approach?
Structure of Remuneration Most recent year (either 2020 or 2019) Total Pay – 100% Fixed Pay - % Annual Bonus - % LTIP - % Previous year (either 2019 or 2018) Total Pay – 100% Fixed Pay - % Annual Bonus - % LTIP - %

6. Conclusion – Write a conclusion that summarises the extent of your company’s compliance with all the requirements of the UKs Code of Corporate Governance. Drawing on the academic literature assess whether adherence to the code or not is important to the performance of the company. (Approximately 300 words)

Word limit

The maximum word limit for this assessment is 2000 words.

Where the submission exceeds the stipulated word limit by more than 10%, the submission will only be marked up to and including the additional 10%. Anything over this will not be included in the final grade for the assessment item. Abstracts, bibliographies, reference lists, appendices and footnotes are excluded from any word limit requirements

Learning Outcomes

On successful completion of this assessment, you will be able to:

· Level of understanding, analysis, and application to your company (30%)

· Level of justification, evaluation, and appraisal (30%)

· Quality of argument, synthesis, and conclusion (30%)

· Professional and academic quality of written work and accuracy of referencing (10%)

Your grade will depend on the extent to which you meet these learning outcomes in the way relevant for this assessment. Please see the grading rubric on NILE for further details of the criteria against which you will be assessed.

Assessment Criteria

· Level of understanding, analysis, and application to your company (30%)

· Level of justification, evaluation, and appraisal (30%)

· Quality of argument, synthesis, and conclusion (30%)

· Professional and academic quality of written work and accuracy of referencing (10%)

Assessment Support

Specific support sessions for this assessment will be provided by the module team and notified through NILE. You can also access individual support and guidance for your assessments from Library and Learning Services. Visit the Skills Hub to access this support and to discover the online support also available for assessments and academic skills.

Academic Integrity and Misconduct

Unless this is a group assessment, the work you produce must be your own, with work taken from any other source properly referenced and attributed. For the avoidance of doubt this means that it is an infringement of academic integrity and, therefore, academic misconduct to ask someone else to carry out all or some of the work for you, whether paid or unpaid, or to use the work of another student whether current or previously submitted.

For further guidance on what constitutes plagiarism, contract cheating or collusion, or any other infringement of academic integrity, please read the University’s Academic Integrity and Misconduct Policy. Also useful resources to help with understanding academic integrity are available from UNPAC .

N.B. The penalties for academic misconduct are severe and can include failing the assessment, failing the module and expulsion from the university.

Assessment Submission

To submit your work, please go to the ‘Submit your work’ area on the NILE site and use the relevant submission point to upload your report. The deadline for this is 11.59pm (UK local time) on the date of submission. Please note that essays and text-based reports should be submitted as word documents and not PDFs or Mac files.

Written work submitted to TURNITIN will be subject to anti-plagiarism detection software. Turnitin checks student work for possible textual matches against internet available resources and its own proprietary database. Work

When you upload your work correctly to TURNITIN you will receive a receipt which is your record and proof of submission. If your assessment is not submitted to TURNITIN, rather than a receipt, you will see a green banner at the top of the screen that denotes successful submission.

N.B Work emailed directly to your tutor will not be marked.

Late submission of work

For first sits, if an item of assessment is submitted late and an extension has not been granted, the following will apply:

· Within one week of the original deadline – work will be marked and returned with full feedback and awarded a maximum bare pass grade.

· More than one week from original deadline – grade achievable LG (L indicating late).

For resits there are no allowances for work submitted late and it will be treated as a non-submission.

Please see the Assessment and Feedback Policy for full information on the processes related to assessment, grading and feedback, including anonymous grading. You will also find the generic grading criteria for achievement at University Grading Criteria. Also explained there are the meanings of the various G grades at the bottom of the grading scale including LG mentioned above.

Extensions

The University of Northampton’s general policy with regard to extensions is to be supportive of students who have genuine difficulties, but not against pressures of work that could have reasonably been anticipated.

For full details please refer to the Extensions Policy. Extensions are only available for first sits – they are not available for resits.

Mitigating Circumstances

For guidance on Mitigating circumstances please go to Mitigating Circumstances where you will find detailed guidance on the policy as well as guidance and the form for making an application.

Please note, however, that an application to defer an assessment on the grounds of mitigating circumstances should normally be made in advance of the submission deadline or examination date.

Feedback and Grades

These can be accessed through clicking on the Feedback and Grades tab on NILE. Feedback will be provided by a rubric with summary comments.

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ES1- Marking Rubric

Levels of Achievement
Criteria	No Submission / no evidence	Fail	Pass	Commended	Merit	Distinction
Level of understanding, analysis, and application to your company (30%)	0 points Non-Submission	1 to 11 points Weak to poor understanding and analysis of the codes of corporate governance. Weak to poor understanding of theories of corporate governance. Weak to poor application to your company with regard to the company purpose and communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk, CEO remuneration, and your company’s compliance to the UKs Code of Corporate Governance.	12 to 14 points Satisfactory understanding and analysis of the codes of corporate governance. Satisfactory understanding of theories of corporate governance. Satisfactory application to your company with regard to the company purpose and communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk, CEO remuneration, and your company’s compliance to the UKs Code of Corporate Governance.	15 to 17 points Sound understanding and analysis of the codes of corporate governance. Sound understanding of theories of corporate governance. Sound application to your company with regard to the company purpose and communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk, CEO remuneration, and your company’s compliance to the UKs Code of Corporate Governance.	18 to 20 points High quality understanding and analysis of the codes of corporate governance. High quality understanding of theories of corporate governance. High quality application to your company with regard to the company purpose and communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk, CEO remuneration, and your company’s compliance to the UKs Code of Corporate Governance.	21 to 30 points Very high-quality understanding and analysis of the codes of corporate governance. Very high-quality understanding of theories of corporate governance. Very high-quality application to your company with regard to the company purpose and communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk, CEO remuneration, and your company’s compliance to the UKs Code of Corporate Governance.
Level of justification, evaluation, and/or appraisal (30%)	0 points Non-Submission	1 to 11 points Weak to poor level of justification, evaluation, and appraisal. Little to no attempt to justify your company’s approach to the purpose and communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk, CEO remuneration. Little or no evaluation and/or appraisal of the academic theory and evidence on listed companies’ approach to communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk. Little to no evaluation and/or appraisal of your company’s compliance with the UK Code of Corporate Governance	12 to 14 points Satisfactory level of justification, evaluation, and appraisal. Satisfactory justification of your company’s approach to the purpose and communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk, CEO remuneration. Satisfactory evaluation and/or appraisal of the academic theory and evidence on listed companies’ approach to communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk. Satisfactory evaluation and/or appraisal of your company’s compliance with the UK Code of Corporate Governance	15 to 17 points Sound level of justification, evaluation, and appraisal. Sound justification of your company’s approach to the purpose and communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk, CEO remuneration. Sound evaluation and/or appraisal of the academic theory and evidence on listed companies’ approach to communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk. Sound evaluation and/or appraisal of your company’s compliance with the UK Code of Corporate Governance	18 to 20 points High quality level of justification, evaluation, and appraisal. High quality justification of your company’s approach to the purpose and communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk, CEO remuneration. High quality evaluation and/or appraisal of the academic theory and evidence on listed companies’ approach to communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk. High quality evaluation and/or appraisal of your company’s compliance with the UK Code of Corporate Governance.	21 to 30 points Very high-quality level of justification, evaluation, and appraisal. Very high-quality justification of your company’s approach to the purpose and communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk, CEO remuneration. Very high-quality evaluation and/or appraisal of the academic theory and evidence on listed companies’ approach to communication with stakeholders, effective leadership, board independence, board evaluation, audit and risk. Very high-quality evaluation and/or appraisal of your company’s compliance with the UK Code of Corporate Governance
Quality of argument, synthesis, and conclusion (30%)	0 points Non-Submission	1 to 11 points Weak to poor level of argument with little to no support from academic theory and evidence. Weak to poor synthesis of the material. Weak to poor or no conclusion	12 to 14 points Satisfactory level of argument with some acceptable support from academic theory and evidence. Satisfactory synthesis of the material. Satisfactory conclusion	15 to 17 points Sound level of argument with commendable support from academic theory and evidence. Sound synthesis of the material. Sound conclusion	18 to 20 points High quality level of argument with very good support from academic theory and evidence. High quality synthesis of the material. High quality conclusion	21 to 30 points Very high-quality level of argument with excellent to outstanding to exceptional support from academic theory and evidence. Very high-quality synthesis of the material. Very high-quality conclusion
Professional and academic quality of written work and accuracy of referencing (10%)	0 points Non-Submission	1 to 3 points Poor quality of academic writing, with many spelling, grammar and other errors demonstrating a lack of professional attention to the work. Poor or no referencing. Fails to apply the Harvard system of referencing.	4 points Satisfactory quality of academic writing, with some spelling, grammar and other errors demonstrating a satisfactory professional attention to the work. Satisfactory referencing. A satisfactory application of the Harvard system of referencing.	5 points Sound quality of academic writing, with few spelling, grammar and other errors demonstrating a sound professional attention to the work. Sound referencing. A sound application of the Harvard system of referencing.	6 points High quality of academic writing, with minor spelling, grammar and other errors demonstrating a high-quality professional attention to the work. High quality referencing. A high-quality application of the Harvard system of referencing.	7 to 10 points Very high-quality of academic writing, with accurate spelling, grammar and few other errors demonstrating a very high-quality professional attention to the work. Very high-quality referencing. A very high-quality application of the Harvard system of referencing.