Role of Governance Flashcards
What are requirements in the composition of the board
Independent board members
The chair of the board must be independent
Need a diverse set of experiences, competencies, skills, and Judgement
Hold regular meetings without mgmt present
Need to get along
What are the responsibilities of the board?
Prevent and detect fraud Ensure integrity of the mgmt and CEO Identify Risks to the organization Strategic planning Succession planning
What are the duties of the audit committee?
Review annual and interim FS
select auditors
Ensure internal controls function as intended
Understand the mgmt use of estimates and judgment
Monitor compliance with regulatory requirements
understand the advice given by external advisors
Oversight to the internal audit function
What is CSR?
Means to integrate social, environmenta,l and economic concerns into their values, culture, and decision making.
It is beyond the law commitments and activities to promote governance, ethics, planet, people, HR
What is a Tripple bottom line
Focus on People, Profit and planet focus
People - business and labor practices
Planet - Sustainable environmental practices
Profit - Economic value created by the company
How can BOD prevent and detect fraud?
Ensure that mgmt are carrying out fraud prevention tasks
Understand the internal environment to see where mgmt can override the controls and provide additional oversight on these areas
What is sustainability reporting?
Reporting on a company’s CSR and value s and priorities in Econ, environ, governance and social
Why do you need sustainability reporting?
Stakeholders require it
Can help improve sustainability program
What is the impact of Social Media on the BOD
Increased timing and flow of info due to increased transparency
A significant source of reputational risk
Requires protocols for use and response
What is the impact of environmental and social issues on the BOD
Affects risk assessment process and risk oversight requirements to the BOD
Does the company make sufficient disclosures in relation to competitors related to voluntary disclosures
Ensure information given out is consistent with actual received
What is the Code of conduct
A conde that directs ethical and acceptable behaviors in an entity
Why is the Code of conduct important
Sets the tone at the top
Reduces the risk associated with fraud, conflict of interest and etc.
Helps introduce new employees to the organization
