BUSINESS WITH CONFIDENCE icaew.

com
Jo Iwasaki, Head of Corporate Governance, ICAEW
What are the overarching principles of
corporate governance?
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
We provide qualifications and career support to over 140,000
chartered accountants and 20,000 ACA students worldwide





Founded in 1880
World leader of the accountancy,
finance and business profession
Headquarters at Chartered
Accountants Hall, London
ICAEW
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
OFFICES
UK
Beijing
Brussels
Dubai
Hong Kong
Kuala Lumpur
Singapore
ACA TRAINING
UK
Bangladesh
China
Cyprus
Gibraltar
Greece
India
Kenya
Malaysia
Malta
Mauritius
Middle East
Pakistan
Romania
Russia
Singapore
Sri Lanka
A WORLD LEADER IN ACCOUNTANCY AND FINANCE
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
The ICAEW members in business

55%
of FTSE 100 companies have an ICAEW
Chartered Accountant as chairman, CEO
or CFO
80%
of FTSE 100 company boards include at
least one ICAEW member.
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
Public
interest
Member
interests
The ICAEW charter
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
Sustainable
Business
ICAEW thought leadership
re:Assurance
Dialogue in
Corporate
Governance
Financing
Change
Finance
Innovation
Lab
Inspiring
Confidence
in Financial
Services
Market
Foundations
Crisis
Without a
Legacy?
Information
for Better
Markets
Audit
Quality
Forum
Finance
Direction
Towards a
Better Tax
System
Making
Information
Systems
Work
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
Dialogue in corporate governance

Project process
ICAEW Corporate Governance Committee:
including board members, investors,
practitioners
Engaging wider stakeholders, such as
academics and regulators
Facilitating on-going debate with other interested
parties

BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
Dialogue in corporate governance

Five questions: New challenges

What should companies be responsible for?
What are the overarching principles of
corporate governance?
When is comply or explain the right approach?
How diverse should boards be?
Who should be covered by codes?
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
Dialogue in corporate governance

Five questions: New challenges
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
Background

Why are these questions important?

Recent events triggered by financial crisis

Changes in capital markets

Challenges to companies



BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
What should good corporate governance
achieve?
the boards must be free to drive their
companies forward, but exercise that
freedom within a framework of effective
accountability. This is the essence of any
system of good corporate governance.

(from Cadbury Report, 1992)
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
What are the overarching principles of corporate governance?



Four fundamental responsibilities
Achieving a business purpose
Behaving in a socially acceptable way
Meeting legal and regulatory requirements
Stating how responsibilities are met
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
What are the overarching principles of corporate governance?

How can these responsibilities help companies?
To be agile and adaptable to their environment
To identify new opportunities
To rebuild public trust
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
What are the overarching principles of corporate governance?

Examples
Executive remuneration
Bank bailouts
Short termism
Aggressive tax avoidance

BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
What are the overarching principles of corporate governance?

How should the board lead the company?
Satisfying a range of responsibilities
Decisions to facilitate long-term success
Developing a sustainable business model
Going beyond compliance
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
What are the overarching principles of corporate governance?

Overarching principles
Leadership
Capability
Accountability
Sustainability
Integrity


BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
Characteristics of overarching principles
Linked to business purpose
Related to outcomes
Focused on what is most important
Clear and concise
Durable
Widely accepted
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
What are the overarching principles of corporate governance?

Guiding companies in the time of crisis
Having guidelines for difficult governance issues
Open and dynamic board processes
Using judgement appropriately
Promote a robust corporate culture
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
Challenges to overarching principles
Following principles is not always easy
because:
Subjectivity in concepts
Need to use judgement
Explain why judgement is appropriate

Aspirational
Intended to continue improving governance

BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
Corporate Governance:
New Challenges
Go to: icaew.com/newchallenges
Thought Leadership Go to: icaew.com/thoughtleadership
For more information
ICAEW Go to: icaew.com
SEA Region Office
Go to:
icaew.com/en/about-icaew/where-we-are/south-east-asia
BUSINESS WITH CONFIDENCE icaew.com
ICAEW 2013
Questions?
A world leader
of the accountancy
and finance profession
BUSINESS WITH CONFIDENCE icaew.com