Research paper

Boards of directors are at the apex of organisations’ decision-making structures (Fama & Jensen, 1983), and are generally considered to be the most important internal governance mechanism. The board thus has a crucial role in both conformance and performance of companies. Section 3 of the 2018 UK code of corporate governance is on board composition, succession and evaluation, whilst Section 5 is on Remuneration. As a governance analyst you have been asked to undertake a report on specific aspects of compliance with Sections 3 and 5 of the 2018 UK Code of Corporate Governance with regard to your allocated companies. To investigate company compliance each student will be allocated 2 FTSE350 companies.

Your task is to review the theoretical literature on board composition, and CEO remuneration and to examine the extent to which your companies comply with the reporting requirements in Section 3 and 5 of the code. Your report should include the following:

a) An introduction to the domain of corporate governance and within it the role of boards.
b) A critical review of the different theoretical perspectives on board composition, and CEO remuneration.
c) A critical appraisal of the extent to which your companies comply with the reporting requirements of Sections 3 and 5 of the 2018 UK Code of Corporate Governance
d) A conclusion in which you include 2 or 3 recommendations to regulators on changes to future codes relating to Board Composition, Succession, Evalution, and CEO Compensation.

The two companies are Auto traders group plc and marks and spencer group plc