Tutorial 13 Q 1

CORPORATE SOCIAL RESPONSIBILITY.

State example of activities that have been carried out

by various companies in performing their Corporate
Social Responsibility.

Cadbury Report 1992 recommended that the boards of public cos should be required
to comply with a code of best practice which is voluntary& would required the cos to
explain in their annual reports &accounts the extent to which they had complied with
the code & the reasons for any non-compliance. It suggests that an audit committee of
a majority of non ex ds be set up to oversee the cos finance. Also the CEO &
chairman should be different persons.

Greenbury Report- ds remuneration should not be excessive.

Corporate Social Responsibility.

Hampel Reort 1998 was to review & enhance the recommendations of the
Cadbury & Greenbury Committees- chairman & CEO are kept separate; a
balance between ex & non ex ds; no ds should be in deciding his own
remuneration.

The Combined Code- the accepted principles & best practices of Cadbury,
Greebury & Hampel were put together into a single code called the
Combined Code & is adopted by the London SE & included into the UK
Listing Rules.

Corporate Social Responsibility.

Turnbull Report 1999 was produced by the Institute of Chartered Accountants in

England & Wales with the purpose to give guidance to listed companies on how to
implement the Combined Code- keeping good internal control in the companies &
having good audit& check & ensure quality of good finance reporting.

In western Europe, Germany developed its own code of best practice the Cromme
Code.

Corporate Social Responsibility.

The Sarbanes-Oxley Act 2002(SOX)- after the collapse of Enron, Worldcom etc the
US enacted the SOX design to improve the quality of transparency of financial
reporting, independent audits & accounting services. SOX key points include audit
committee, auditor independence, internal control report & increased finance
disclosure.

The Malaysian Code on CG was launched by SC in 2000. The principles of the

MCCG are incorporated in the BMLR. Para 15.26 of the BMLR requires plc to
disclose in their annual report how they have applied the MCCG. 2 or 1/3
of BOD are independent directors, directors must attend mandatory
training by BM& Audit Committee to be formed.