Corporate Goverance Practices of Boeing, Honda and Daimler

5602 words 23 pages
Group Assignment:
Corporate Governance Practices of Boeing, Honda & Daimler

Melbourne, May 2014


Characterised by nation-specific features and different regulatory systems, the use of corporate governance mechanisms varies across different countries in the world. This paper will help investigate those differences by examining the current corporate governance practices of three different companies representing for three powerful countries namely Japan,
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The Co-Determination Act of 1976 stipulates that it is a requirement for the supervisory board of a company with more than 20,000 employees to have 20 seats. This law also requires that half of the Supervisory Board is elected by the shareholders at the Annual Meeting while the other half comprises members who are elected by the Company’s employees who work in German.
The board system: Boeing and Honda share the similarity of one-tier board system while Daimler follows two-tier model. In both Boeing and Honda, only one single board exists. The companies are governed by a unified board performing both management and supervisory functions. However, the BOD of Boeing seems more powerful than the Japanese one when they have rights to decide the dividend rate for shareholders as well as the Chairman and Chief Executive Officer of Boeing are just one person (Boeing 2013). While all board members are elected by the shareholders, Boeing’s shareholders have very little say beyond electing directors, but it is easier for Honda’s shareholders to directly nominate directors and elect them (Allen & Zhao 2007). Furthermore, while the Boeing’s BOD concerns mostly with the goal of ensuring to maximize the wealth of shareholders, the Honda’s directors focus on the broader group of stakeholders including employees, suppliers, customers and others as well as shareholders (Boeing & Honda 2013). Daimler shares the