Corporate Governance and Management Controls Flashcards
Integrity
Straightforward, honest, fair and truthful
Objectivity
Not allow bias, conflict of interests or undue influence to override judgements
Professional competence and due care
Maintain knowledge and skill, only do jobs they are qualified for and able to do well
Confidentiality
Can breech where:
- it is in the public interest to disclose unethical behaviour
- It is the members interest to protect his reputation
- Required by law
- Money laundering is taking place
Professional behaviour
Laws and regulations must be complied with
Entrepreneurial Structure
Control is exercised by the leader, their expertise and they way they run and manage their staff
Functional structure
Control is exercised by functional responsibilities and functional experts. A budget is allocated to each cost centre and controlled using variance analysis
Divisional structure
Each division can be controlled using profit based targets for divisional managers, including profit centres and investment centres
Matrix sturcture
Reporting relationships are set up as a grid, or matrix, rather than in the traditional hierarchy where employees have dual reporting relationships. They are often used in projects
Network structure
More than one organization combine to produce a good or provide a service e.g. through outsourcing. This depends on the relationship with external organisations and control is exercised mostly by well drafted contracts with clear requirements.
Economy
The cost of resources used (are you spending more on resources than you should?)
Efficiency
Output vs input (is there more wastage than expected?)
Effectiveness
Achieving targets (are you being more economical and efficient in achieving your goals?)
