Research and evaluate the corporate governance arrangements for Essay

Research and evaluate the corporate governance arrangements for SAINSBURY (J) PLC. Present your findings in a business report fo - Essay Example Based on research, a recommendation for potential improvement is provided. 2. The governance structure at Sainsbury Sainsbury maintains a very well-developed, stakeholder-centric corporate governance model following transformational leadership design, one in which corporate social responsibility is reflected recurrently associated with satisfying positive models of human resource management. Fairholm (2009) describes the transformational leadership model as a holistic model in which managers and executives regularly impart corporate mission and vision, open positive lines of communications in a flattened, decentralised hierarchy, and where power distance between board members and mid-tier managers are largely finite. The Board is structured to include three executive-level directors and six non-executive directors, in which there are clear division of authority and responsibility between the Chairman of the Board and the Chief Executive Officer (Sainsbury 2012). Non-executive board m embers are independent, yet they have diverse and unique corporate experience and education to contribute expert analyses and opinion regarding the establishment of Sainsbury strategic and financial agenda (Sainsbury 2012). Outside of traditional corporate governance activity found in most industries in large organisations, which include finance, operational strategy, risk management and compliance controls, Sainsbury’s board is also structured with subcommittees (Steering Groups), responsible for a wide variety of assessments ranging from corporate social responsibility to stakeholder relationship management imperatives (Sainsbury 2012). The Sainsbury corporate governance model moves beyond traditionalism, following such models as Adam Smith’s Invisible Hand, and has transformed into a holistic system of governance that includes consistent and recurrent emphasis on establishing better stakeholder relationship management. Examples at Sainsbury of this transformational model include a branding steering group, climate change steering groups, community and internal human resources steering groups (Sainsbury 2012). These committees meet annually or bi-annually depending on business imperatives dealing with positive sustainable procurement modelling, improvement of customer service, and employee relationship development (Sainsbury 2012). This diversification in extended corporate governance activities did not, however, occur within a vacuum. Rather, the dynamic and diverse corporate governance activities are a product of business evolution at Sainsbury that has occurred through emergent, historical learning and business repositioning that has occurred over the last decade due to growth in competition and diminished market entry barriers that has changed competitive and investment dynamics. In the early 2000s, Sainsbury realised that the company was gaining more target market loyalty and respect for the Sainsbury brand by emphasising corporate social r esponsibility as a positive brand differentiation scheme. By 2004, Sainsbury had a well-respected reputation for corporate social responsibility, taking an intangible human capital asset and transforming it to a marketable brand personality and identity that gained a great deal of market interest and loyalty. This