...Stakeholders and Shareholders but the Fact is local and big businesses are focusing more on the consumer, ‘shareholder’ rather than the Stakeholder. The wants and needs of the Shareholder come first. Companies are more focused on customer satisfaction but there is some that put their staff before customers such as ‘John Lewis’. ‘Short term pursuit of gain is rarely likely to benefit a business in the long run anyway’. The point being made is companies want to maximise the values of their Shareholders but don’t want to put Stakeholders at risk as they wish to make the business a lasting one and the employees are important to max a long-term shareholder as quoted ‘If retaining talented staff is a managers’ hardest task, Devotion to employees may be the best way to maximise long-term shareholder value. I agree with the statement on the maximisation of the shareholders but I also think it is important to split it equally between the stakeholders and shareholders. They both play a vital part internally and externally. But with Stakeholders Plans and adjustments must be made for a business to adjust and thrive so maybe it is best to put the stakeholders before the shareholder. It has to be balance as the Stakeholders wish to keep in the shareholders happy as they are the Managers, Owners, Employees and Customers who will keep the company rolling forward. I think without the shareholders the stakeholders are nothing because if the businesses plan isn’t going accordingly the business will be...
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...Industrias La Vega, organized the first family council meeting in the owning family’s history to address problems he was having with his youngest sister, Mari, a shareholder in the company. He felt that the problems were not of his making and were interfering with his management of the company. Francisco, 45, had worked closely with his father, Francisco Sr., since 1986 and had become president of the company in March 2004, when his 72-year-old father was killed in an automobile accident. Industrias La Vega was a Spanish meat-processing business that produced hams, sausages, and other delicacies for domestic and export markets. The $104.8-million-a-year business was demanding, of course, but Francisco Jr. felt most challenged by the family conflicts that often overwhelmed him. The ownership structure of Industrias La Vega had been updated just months before the tragic accident involving Francisco Sr. At the request of Francisco Jr., who was concerned about the possible loss of control of the enterprise he had co-managed with his father for years, Francisco Sr. and his attorneys had created two classes of stock. The voting A shares did not pay dividends. The nonvoting but dividend-bearing B shares had a par value 10 times higher than that of the A shares. Except for brief stints, none of the Valle daughters had worked in the business prior to their father’s death. Ana, the second eldest daughter, was an artist, and she had been instrumental in designing the image and logo of a new premium...
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...Therefore, a large company like LG Electronics can have a great impact on the society and has many stakeholders. The internal ones include directors/managers, employees and shareholders. Suppliers, customers, NGO/ International organizations, community and local government are external stakeholders. Directors/managers Directors and managers are the ones that run the business. They aim to maximize their own benefits, such as higher salary and annual bonus. Thus, they try their best to improve the corporate values. Shareholders By the end of 2012, the number of shareholders of LG Electronics was 201,161. Shareholders are powerful stakeholders because they invest their money into the business. As the owners of the business, they aim to maximize the profit. They are hoping for a disclosure of transparent management information as well as more dividends. It is stated in the mission statement that the company wants to deliver innovative products. Without re-investing profit into the business, new products may not be invented. However, shareholders tend to share the profit immediately, which conflicts with the mission statement. LG Electronics communicate with the shareholders through different ways, including holding a general shareholders’ meeting, having a performance presentation and publishing a business report. Employees Another important internal stakeholder group is employees. As of December 31, 2012, LG Electronics has 86,697 employees in total, with 36,378 local employees...
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...essential goal of your business, while subsidizing your business. To assistance you in deciding there are numerous resources and there are countless aspects to be deliberated in the development of the business. When attempting to start a business the smallest amount of my difficulties are going to be a low net worth and the limited management experience. When you are developing your business you need to keep in consideration the risk factors in opening a business at all times. Funding a Business Venture For my specific condition, I have made the decision, that the finest legal type of business as an originator would be a corporation. I must now make the decision as to what method would be the best for financing of my business. Borrowing money from the bank, selling the supply, or licensing my product; are all selection I that are essential to be taken into to deliberate and examine prior to reaching the finalized conclusion. For the subsidy of my business, the best legal form of business I have decided upon, marketing stocks would be the finest for the corporation. In corporation stock is a minor portion of proprietorship. The proprietorship is divided into small portions are identified as shares. To establish how much of the business each individually shareholder maintains, shares are purchased and retailed to any person that wants it. If a company is doing well with the stock market, the cost of the share would be raised. If the business was not doing well,...
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...Business Society and Ethics 2/4/15 Based on the analysis required for this assignment, we are told to assume that Jack Ma has acquired the West Texas Fertilizer plant. From prior knowledge, I know that Jack Ma is a staunch “advocate for corporate social responsibility” and is a major advocate for improving the “environment”. I have also learned that Jack Ma is an individual who pays attention to social issues and works to ensure that some sort of change is brought forth to improve these issues. Based on the background information given about Jack Ma, I can assume that if Ma acquired the West Texas Fertilizer plant he would conclude that the fire in which took the lives of 35 innocent individuals is due to the irresponsible actions of the company owner. He would conclude that many alternate steps could have been taken to ensure that the fire would not occur. Ma would not only take steps to improve the infrastructure of the West Texas Fertilizer plant but would also improve the social structure of the plant because he is not concerned about maximizing profit for the benefit of the corporation but he is more concerned with making “healthy money, enabling people to enjoy their lives”. The first step that Ma would take is to “reboot and revisit the initial dream the company had while questioning what is the sole purpose of building the business”. He would then try to better educate individuals on issues relating to the plant. These educational forums may include...
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...THE COMPANIES ACT, 2063 (2006) Date of Authentication: 2063.7.17.6 7 kartik 2063 ( 3 November 2006) 1. The Act Amending Some Nepal Acts, 2064 2064.5.9 (26 August 2007) ACT NO. 18 OF THE YEAR 2063 (2006) An Act made to amend and consolidate the law relating to companies Preamble: Whereas, it is expedient to amend and consolidate the law relating to companies in order to bring about dynamism in the economic development of the country by promoting investment in the industry, trade and business sectors through economic liberalization and make the incorporation, operation and administration of companies much easier, simpler and more transparent; Now, therefore, be it enacted by the House of Representatives in the First Year of the issuance of the Proclamation of the House of Representatives, 2063 (2006). Chapter 1 PRELIMINARY 1. Short title and commencement: (1) This act may be called as the “Companies Act, 2063(2006)”. (2) This Act shall be deemed to have come into force on 20 Ashwin 2063 (6 October 2006). 2. Definitions: In this Act, unless the subject or the context otherwise requires, (a) “Company” means a company incorporated under this Act. 1 (b) “Private company” means a private company incorporated under this Act. (c) “Public company” means a company other than a private company. (d) “Holding company” means a company-having control over a subsidiary company. (e) “Subsidiary company” means a company...
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...gradually grown in the stock markets of developing countries as a result of financial globalization. This trend has led to an increasing concern as to whether these investors can influence the management decisions of the local firms in developing countries. This paper empirically investigates the impact of foreign institutional investors on corporate dividend policy in the Indian stock market. Using sample firms whose ownership by foreign investors was 5% or higher through the fiscal period from 2007 to 2011, we examine whether foreign institutional investors with more than 5% of a company's shares can exert a significant impact on dividends. In addition, we investigate if more shares that foreign institutional investors have over major shareholders and the more shares that foreign institutional investors have over the previous year, the stronger the impact of foreign institutional investors have on corporate dividend policy. This study empirically shows the impact of foreign institutional investors from the viewpoint of corporate governance in India, where local institutional investors play inadequate roles as Stakeholders. FII STRONGHOLD A look at the BSE-500 ownership pattern suggests that FIIs held as much as 15 per cent of the full-market capitalisation of the BSE-500 and a whopping 35 per cent of the freefloat market cap as of March 2011, thus providing them considerable influence over stock markets. Domestic institutions (mutual funds and insurance companies), on the other...
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...Shareholders A shareholder is a stakeholder in a company because they own shares in the company. Another reason that a shareholder is a stakeholder is because they provide funding for Monarch. On 15 November 2011 the shareholders provided £77 million of funding. Shareholders A shareholder is a stakeholder in a company because they own shares in the company. Another reason that a shareholder is a stakeholder is because they provide funding for Monarch. On 15 November 2011 the shareholders provided £77 million of funding. Monarch Stakeholders Introduction Monarch Airlines operates a fleet of 32 aircraft on scheduled and charter flights from a number of UK airports, including Birmingham, East Midlands, Leeds Bradford, London Gatwick, London Luton and Manchester. Flying to more than 50 destinations worldwide, it carries in excess of 6.5 million passengers every year. Competitors British Airways is a stakeholder in Monarch because they are competitors and they want their sales to increase. British Airways is a stakeholder because they are competing with Monarch to try and sell as many flights as possible. British Airways is a stakeholder in Monarch because they are affected by the decisions Monarch make. Employee An employee is a stakeholder because they work at Monarch. They are interested in the success of the company because they do not want Monarch to go out of business. This would make the employees at Monarch lose their jobs. Employees...
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...Financial Management refers to a rulebook which a business must follow to be accountable to their shareholders, stakeholders and the general public. See financial management is the essential because a big amount people can be affected by the unethical behaviors and the actions on a business. The employees deserves to know what’s going on in the upper management and with the company as a whole just in case in advance of potential but yet serious problems. The shareholders and the general public have to know to because the shareholders got to know what are going on with company and what they’re investing. Their money depends on its financial strength of the company. The general public has to know for the fact of the transactions of a public traded company, just in case if there is catastrophe, which they could be responsible for it bailing out of the company including with the taxpayers money. Economic status in company’s market place could include price earning ratios, the earnings per share, the price and cash ratios, book value per share, dividends yielding, market value per share and the marker and book ratios. The market value gives the management an ideal of what the company or firm investors thinks of their performance and future prospects. If a company’s ratios are good then the market value ratios can or should reflect on that and stock prices may go high. The increasing of a company’s stock prices depends on the business managers trying to maximize the wealth. When stock...
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...Social responsibility is often viewed as an inconvenience that cuts into shareholder profits. An organization that with this outlook on social responsibility is missing a significant opportunity to improve public perception and drive profits. This is clearly the view of company Q. When twice presented with the opportunity to create both social and monetary capital, they failed miserably. This likely contributed to the closure of 2 stores due to low performance. Not only are they harming their stakeholders (the communities in which they operate) but, they are also harming their shareholders by not capitalizing on revenue opportunities. There are three clear answers to their deficiencies. The first and most obvious is to begin donating the items that are expired to the local food bank as requested. The second is to implement a code of ethics in the corporate guidelines. Lastly, they should be expanding the current selections of healthy and organic foods. If these steps are followed, can the Company Q dig itself out of the loss column and see some profits? The answer is yes. Company Q was recently approached by the local food bank, and asked to donate the day old foods that Company Q had been throwing away. Management declined, opting instead to to continue to write the food off as a loss and throw it into the trash. The reason that was cited was concern for fraud and employee theft. This is an example of the company taking the short term bottom line approach. They...
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...Creating Financial Acumen 1. Companies are in business because they want to achieve profits. In this regard, it is necessary that there is a solid financial acumen no matter what business the company is engage in. Being a paralegal, for instance, means that I work for a law firm. The firm should be aware of its finances in order to retain the best lawyers, paralegals, and other staff. If the firm does not have financial acumen, its workers are likely to ignore the importance of billing and the number of hours logged for every case. This is how law firms make money. Thus, it is important that everybody knows how to help the company make money. Companies that do not teach their employees the importance of finances will find themselves with people who do not appreciate the importance of cost-cutting measures and how their productivity could help the companies’ profitability and long-term success. 2. There are many factors to consider when understanding shareholder value and if a company has maximized it. One of these factors is that of how the shares are being used to improve dividends. In the case of Microsoft, the company has stopped stock options for executives since 2003 (Moyer, McGuigan & Kretlow, 2009). In its stead, the company uses the restricted stock, which ensures that an executive has to stay for a number of years before he or she can vest the stock. This protects shareholders value because the executives are not likely to do anything that would jeopardize their...
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...2010: Dividend per share = 20p, Dividend yield = 13.3%, Current ratio = 1.6:1 2011: Dividend per share = 40p, Dividend yield = 20%, Current ratio = 2.1:1 The shareholders of Scott Electronics might be pleased because the dividend per share has improved by 20p from 2010 and dividend yield also improved by 7% in a years time. This makes owning the shares more attractive and also it is likely to encourage the existing shareholders to retain their shares. Also, another reason could be the fact that the share price increased by 50p, form 1.50 to 2.00, this would also please shareholders because they can make profit from their shares and it can also attract new investors. Increase in operating profit and reserves will also please the shareholders, the operating profit increased by 2 million and reserves increased by a million. These facts indicate that business is doing well and has improved its performance over the year and also that it has saved money, which can be invested later on, in the long term. However, there might be possible reasons, which could explain why shareholders would not be pleased. One of the reasons is that the dividend yield is still below the industry average dividend yield, which is 25%. Shareholders might not like the fact that Scott Electronics dividend yield is lover than industry average and might sell their shares. Another reason might be the fact that Scott Electronics sold their head office for 2 million, so their fixed costs are likely to increase...
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...benefit of the company in exchange for remuneration. The employee is going to be already being rewarded for his work and claiming ownership of the information would otherwise thus be a breach of a contract. Thus, let us take the position that price sensitive information is created by and belongs to the company. The company has the right to do what it wills wants with the information. So it is firm and not the employees who are the holders of this information. Let us apply our ethical tools to see if this law passes the ethical tests. Categorical imperative Maxim: Information that is deemed to be price sensitive should belong to the creator company and no one else. Principle of Universality: Information is property that can belong to a business. Property rights should be respected....
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...1. Identify the main stakeholder groups in your company. What claims do they place on the company? How is the company trying to satisfy chose claims? Dell has internal stakeholders’ are: employees, and customers. Dell external stakeholders’ are: suppliers, shareholders, government organizations and non-governmental organizations. Dell helps its employees by sponsoring women rights, gay and lesbian rights, and employees with disabilities. Customers needs are met by customizing products just for them. Suppliers get the best possible deals with Dell. Shareholders get profits. Government and non-government get the best prices for their computers. 2. Evaluate the performance of the CEO of your company from the perspective of (a) stockholders, (b) employees, (c) customers, and (d) suppliers. What does this evaluation tell you about the ability of the CEO and the priorities that he or she is committed to? The CEO, Michael Dell, is always trying to make things better for everyone. He tries to offer everyone the best possible solution. Of course not everyone can be satisfied at the same time. Employees, suppliers, and shareholders speak highly of him and the way he is running the business. If he did not, then employees would be suing him for one thing or another. Suppliers would cut him off, it would be news everywhere. The stakeholders would cash out. 3. Try to establish whether the governance mechanisms that operate in your company do a good job of aligning...
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...nishithdesai.com M&A Lab Takeover Code Dissected About NDA Nishith Desai Associates (NDA) is a research based international law firm with offices in Mumbai, Silicon Valley, Bangalore, Singapore, New Delhi and Munich. We specialize in strategic legal, regulatory and tax advice coupled with industry expertise in an integrated manner. We focus on niche areas in which we provide significant value and are invariably involved in select highly complex, innovative transactions. Our key clients include marquee repeat Fortune 500 clientele. Our experience with legal, regulatory and tax advice coupled with industry expertise in an integrated manner allows us to provide the complete strategy from the onset through to the full set up of the business and until the exits. We focus on niche areas in which we provide significant value add and are involved in select highly complex, innovative transactions. Core practice areas include Mergers & Acquisitions, International Tax, International Tax Litigation, Fund Formation, Fund Investments, Litigation & Dispute Resolution, Capital Markets, Employment and HR, Intellectual Property, Corporate & Securities Law, Competition Law, JVs & Restructuring, General Commercial Law and Succession and Estate Planning. Our specialized industry niches include financial services, IT and telecom, education, pharma and life sciences, media and entertainment, real estate and infrastructure. Nishith Desai Associates has been awarded the “Best Law Firm...
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