Global Corporate Governance Standards: Pros and Cons

Global Corporate Governance Standards Pros and Cons1.0 Background and historyIncreasing be of usual companies and sh beholders base lead to sh atomic number 18holders of the companies not involved in management and control their own company. Thus, they employed superior managers to running their business as a result some of the managers atomic number 18 not working on the behalf of shareholders and caused companies collapsed through with(predicate) financial argument fraud and m singley laundering. The case Watergate s rousedal imputable to break-in to Watergate construct complex in the United States at 1970s had lead to arising of Corporate Governance. Besides, UK had experienced increasing numbers corruption by senior executives or director in late 1980s and early 1990 as nearly. Corporate such as Enron scandal in US caused by conflict in bear on of Arthur Andersen which was as an auditor and consultant at the same times lead the Enron Corporations and one of the five bigg est accounting system and audit firms in the world collapsed. Besides, Lehman Brothers and several UK and European Banking Groups were collapsed in recent year at folk 2008 due to poor collective organisation. Thus, Corporate Governance is the system by which companies is directed and controlled (Cadbury Committee, 1992) in parliamentary procedure to avoid fraud happened. It is the responsible of Board of Directors to arrangement their companies and work on the behalf on stakeholders in their companies. cod to control failure at several major corporations, USA and UK had introduced numbers of guidance reports and laws in separate state of matter in order to pack an effectiveness internal control, independent audit committees, and directors remuneration packages results in increase the reliability of financial dictations. For instance, there was Foreign and Corrupt Practices Act of 1977 and Tread counseling Report published in 1987 at US while there was Cadbury, Rutteman, Hampel and Turnbull reports available at UK since 19922.0 Advantages and disadvantages of world(prenominal) in mergedd organisation standardsSince we are moving toward internationalization of business and growth of global capital market, there are quite a numbers of advantages of utilise global corporate governance standards as a basis to replace interior(a) basis of corporate governance. Meanwhile, organizations all over the world are adopting same principles of corporate governance which it can reduce cost of organizations compare to national basic of corporate governance. It is expensive to cost organizations when they adopting additive banding of rules imposed by local government. Stanwick (2008) claimed that in direct response to the corporate scandals of Enron and WorldCom, the Unites States Congress passed the Sarbanes-Oxley Act (SOX) in 2002.When it passed in 2002, many corporations were vocally opposed to it and claimed that is was just an additional set of governme nt regulations that would cost additional time and money which they could not afford in an increasingly competitive global marketplace. Additionally, it can check out foreign investor no need to facing multi-codes when they are investing at overseas. For instance, Combined Code at UK based organizations and SOX at US based organizations would be removed. By the way, all organizations run throughed global corporate governance able to stimulate performance of die-level management. Since institutes clear accountability and effective link mingled with abide by and performance, top-level management will on the behalf of stakeholders and adherence to the standards.Moreover, investors investing their capitals in others countries would get better protected and would be more than golosh compares to all countries implementing different set of corporate governance standards. Roussey (1997, pg207) stated that once a business entity lists its shares outside of it national borders, it sho uld be subject to a set of global corporate governance rules. It can effectively decrease the chance of top level management using investors capital for self-seeking as well as it required companies to disclose all relevant information while implemented global corporate governance standards. Thus, high quality financial reporting and credible accounting provides the hydrofoil than enables investors to make informed evaluation of enthronisation opportunities (Sutton, 1997). Besides, it can attract more foreign investors to invest in the capital market since stake of investors invest in foreign country has reduced and capital markets has becomes more stability. Consequently, there is more and more investors invest in capital market results in organizations getting great funds to running their business as well as shareholders getting more dividends in return. Next, global in business move toward to use of global shares. As it enable investors to access home country capitals market and non home country capitals market by using same form of shares. In November 1999, for example, Daimler-Chrysler listed on the New York Stock exchange the same shares listed in its home market (Roussey, 2000). Despite of this, it is needed to implement global corporate governance standard to effectively protect shareholders capital. nurturemore, implemented global corporate governance standards can effectively counter financial statement fraud and money laundering by top management which led to corporate collapse. Otherwise it will back to the situation of severe misstatement of financial statement happened in 2002 such as Enron, Tyco, Global Crossing, and Worldcom. All of these are due to nation poor corporate governance exists at those companies and has introduced new corporate governance standards like Sarbanes-Oxley Act (SOX) in 2002 to replace forward standards. Under planetary Standard on Auditing (ISA), auditor has to communicate audit matters with those charged with gov ernance of an entity in all audit situations, and not just in audits of existencely traded entities (Roussey, 2000). It claimed that auditor must informed and discussed with the throng who accept the responsible for companies once they discovered organizations have poor corporate governance such as poor internal control system and misstatement of financial statement. Therefore, they can establish appropriate strategies to address those matters through the knowledge and experience of auditor. By the way, auditor and people who accept the governance responsibilities would be appointed by International Auditing Practices Committees to make sure they are independent enough. Thus, employees at top management level are work accordance with the standards of global corporate governance and move towards credibility of financial statement which brisk by them.Nevertheless, it is feasible for top management not to comply with the standards of global corporate governance aft(prenominal) lon g periods of implementation it. As it is developed from convergence of corporate best practice and global effectual system, top management likely to take legal loopholes once they familiar with the standards of corporate governance in order to satisfies their needs. Additionally, it just only and only one standard that all the organizations need to comply with. political will is absolutely crucial to the developing of means and methods to integrate domestic corporate practices with the best standards followed outside(a)ly. but then can integrity of a countrys economic system get reflected properly and foreign investment in domestic business increase (Bhasa, 2004). Implementation of global corporate governance standards is hard to satisfy the needs of shareholders and stakeholders from all over the world because e trulyone has different demand.However, diverse in cultural and organization organize lead to people accept the responsibilities of governance find it difficult to adap t since the organization members are in different value and belief results in they are using different kind of behavior to hand organization objectives. For example, the problems of corporate governance arise when the rights of the stakeholders are violated. However, what may be considered stakeholder rights violation in one country might not necessarily be considered so in some other country. This alteration may be particularly because of the different legal structures and cultural settings adopted by different nations (Bhasa, 2004). cross-cultural psychological, sociological, and anthropological research shows that many cultures do not shares the same assumptions underlying leader behavior and way of life (Den Hartog et al, 1999). Thus, global corporate governance standards must devise appropriately according to every countries culture dimension and condition. Otherwise it is so hard to monitor the provision of strategic direction performance by top-level of managers in differ ent country are align with companies objectives. Besides, globalization of business lead sociopolitical dynamic and the relation between business, stakeholders, and government will change. According to International Capital Markets Group studied international corporate governance in 1994-1995 (ICMG, 1995), it concluded that it was not appropriate, given the need to respect diverse cultures and legal structures, to prescribe an international standard for corporate governance (Roussey, 2000).3.0 How the situation might develop or be resolved with the neighboring year or soBased on the articles, there is a need to for global corporate governance standards for all corporations because it can add another extent of protect foreign as well as local shareholders and stakeholders. It encourage the internal securities commissions to consider development and implementation of a set of global corporate governance rules applicable, at a minimum, to business entities listing shares or obtaining financing in the public capital markets outside of their national borders (Roussey, 2000). Additionally, it can enhance the transparency relationship between shareholders and companies since the resources in every organization are use appropriately as well as top-level managers are not misdirect their responsibilities on their own interest. Other than that, global corporate governance provides everyone to rely on the organizations financial statement and take it as a reference when investing as well as reporting to shareholders during yearly general meeting.N-nitrosamines in Food effect and LegislationN-nitrosamines in Food Effects and LegislationEffects and responseThe safety of moving picture of humans to inorganic nitrite and nitrate received increased scrutiny in 1960s. Cases of infantile methemoglobinemia associated with high nitrate in inebriation water were documented. Besides, the formation of N-nitrosamines in certain foods, which had been shown to be carcinogenic, rais ed awareness regarding potential human health concern.A plausible biological mechanism which explains carcinogenicity of ingested nitrate and nitrite is endogenous N-nitrosation reactions (Bryan et al., 2012). Normal intakes are not proven to have carcinogenic do. On the other hand, it is the excessive nitrate or nitrite intake which can generate N-nitroso compounds which are carcinogenic and mutagenic by causation DNA alkylation.N-nitrosamines are also genotoxic, which interacts with DNA directly or indirectly, inducing permanent genetic changes in cadres, and causing cancer. For this group, as there is no dose which does not result in a possible effect of the genotoxic carcinogens, thus a no observable effect level (NOEL) cannot be estimated (Ravnum et al., 2014).In addition, photo to nitrosamine affects the immune response strongly. Nitrosamine-induced response towards the immune system is much stronger than nitrosamide-induced response, in a same exposure period. Nitrosamine induces a higher(prenominal) percentage of modulated genes, and involves more pathways. This immunosuppressive effect in turn influences the infixed immune response of cells. This plays an important role in the promotion phase of carcinogenic processes, indicating an additional way for nitrosamines to cancer risk (Hebels et al., 2011).Animal toxicology research serves as an important area for investigation which provides us with safety data. About 90% of the 300 nitrosamines tested showed carcinogenic effects in laboratory animal(prenominal)s and bioassays. Nevertheless, the usage of animal models requires understanding of the difference between human and animal systems. Rodents used for this purposes have fore- survives and Hardarian glands, which is not analogous as in humans (Bryan et al., 2012)..Acute toxic effects of nitrate intake had been encountered only at very high doses. On the other hand, nitrite causes acute toxicity in much smaller doses. In laboratory animals, the LD50 of inorganic nitrite is approximately 2.6 mmol/kg. Some early studies may have shown methaemoglobinaemia when exposed to lower doses of nitrate due to contamination with nitrite (Gilchrist, Shore and Benjamin, 2010).A follow-up study of the Swedish Mamography Cohort found that there is a two-fold elevated risk of stomach cancer with intake of dietary nitrosamines (Larsson, Bergkvist and Wolk, 2006). On the other hand, Loh et al. (2009) suggested that there is a positive association between N-nitrosamine intake and gastrointestinal cancer, especially rectal cancer (Loh et al. 2009).N-nitrosodiphenylamine has shown carcinogenic effects at levels of 1000 parts per million (ppm) to 4000 ppm in both sexes of rats, and there is induced transitional cell carcninoma of the urinary bladder of male and female mice.Dimethylamines and diethylamines are two of the most potent carcinogens among nitrosamines. 50 ppm of dimethylamines in the diet was found to produce malignant liver tumours in rats in 26 to 40 weeks. Meanwhile, higher doses were shown to cause kidney tumours. For diethylamines, a lag period between dosing and onset of tumours increases with dosage below 0.5 mg/kg, with the contribute tumour yield re master(prenominal)ing roughly the same. There is not yet a clear room access dose for carcinogenicity of nitrosamines in diet established (Shibamoto and Bjeldanes, 2009).According to the Netherlands Cohort study, nitrate and nitrite exposure based on food intake and drinkable water show no significant elevation in stomach cancer occurrences, and shows no apparent trend (Larsson, Bergkvist and Wolk, 2006). On the other hand, there is evidence that long-tern consumption of drinking water which contains more than 4 mg/L nitrosamine has been positively associated with risk of non-Hodgkins lymphoma.Although nitrates are take up quickly in mostly excreted within the next few hours, the internal dose or nitrosamine cannot be measured as a 24-hour urinary excret ion. A study done by Levallios et al., (2000) showed that there is a stronger correlation between urinary nitrate excretions with dietary nitrate as compared to urinary nitrate excretion with water nitrate intake. Nevertheless, there is no relation found between nitrosamine excretions with nitrate intake. This might be due to low nitrate concentrations in water, thus causing it to be harder to observe for immediate effects. Further studies are required to determine if the use of urinary nitrosamine excretion as a biomarker of exposure is effective (Levallois et al., 2000).Food laws (limits)EU legislation allows nitrite and nitrate addition of one hundred fifty mg/kg respectively for severally additive in meat products. On the other hand, Denmark only permits the use of 60 mg/kg of nitrites in meat preservation for Danish products (Herrmann, Duedahl-Olesen and Granby, 2015). Further studies are required to determine if the addition of 150 mg/kg or 60 mg/kg of nitrite added would c ause an increase in mean(a) nitrosamine levels. On the other hand, there are no utmost limits established by EU for nitrosamine electrical capacity in processed meat products. The United States had set a limit of 10 g/kg of total volatile N-nitrosamine content for cured meat products (Crews, 2010).The highest amount of a contaminant allowed in drinking water is known as maximum contaminant level (MCL). The US Environmental Protection authorization (EPA) has set a (MCL) for N-nitrosodiphenylamine of 7 g/L (micrograms/Liter) or 7 ppb (parts per billion) based on a lifetime cancer risk of 1 in 1 000 000 (ATSDR, 2010). The EPA established a cancer risk if 0.7ng/kg body weight of N-nitrosodimethylamine is consumed daily.In drinking water, the maximum allowed concentration of N-nitrosodimethylamine in Canada is 40 ng/L and 10 ng/L in Germany (Mestankova et al., 2014). Although the EPA has not established a limit for maximum contaminant level in water, the California Department of well ness Services has established 10 ng/L as notification level for action to be taken (Mestankova et al., 2014).The amounts of N-nitrosodiphenylamine in some commonly eaten foods are 0.023 g/100g in buns, muffins and bagels, 0.149g/100g in ham, and even 0.109g/100g in oysters (Stuff et al., 2009).Current issues (worldwide)Apples from the States have recently encountered some export issues to other countries due to its toxicity. In America, apples which are to be exported are treated with diphenylamine (DPA), which is a preservative added to prevent the apples from turning brown for as long as a few months. This is to prevent cold injury during cold storage, since apples are usually harvested once a year. By itself, DPA isnt harmful, but it breaks down into carcinogenic elements, namely nitrosamines.The European Union has banned the use of DPA in 2012. They set the maximum allowable limit of DPA on apples to 0.1 parts per million (ppm). Nonetheless, DPA residues with an average reading of 0.42 ppm have been found on over 80 apple samples imported from America, which is well over the maximum allowed limit. Thus, the EU is banning apples from America, until the readings are found to be in accordance with the regulation (Lunder, 2014).Although the US EPA and World Health Organisation (WHO) found that long-tern exposure to DPA is unlikely to cause a public health concern, the EU maintains that absence of evidence of harm is not a strong enough indicator. The EU claims that there is insufficient exam regarding DPA to prove that their products as well as chemicals formed are safe to be consumed when broken down. The main source of concern is the presence of nitrosamines.As DPA is the most common chemical used for apples preservation, the presence of cancer-causing nitrosamines should turn in a great concern.ReferencesAgency for Toxic Substances and Disease Registry (ATSDR). 2010. Addendum to theToxicological Profile for N-nitrosodiphenylamine. battle of Atlanta ATS DR- Division of Toxicology and Environmental MedicineLunder, S. 2014. Behind Europes Apple Chemical Ban.http//www.ewg.org/enviroblog/2014/04/apples. Retrieved 21 October 2014.Bryan, N.S., Alexander, D.D., Coughlin, J.R., Milkowski, A.L. and Boffeta, P. 2012. Ingested treat and Nitrite and Stomach Cancer Risk An Updated Review. Food and Chemical Toxicology 50 3646-3665Crews, C. 2010. The Determination of N-nitrosamines in Food. Quality effrontery and Safetyof Crops Foods 2(1) 2-12Gilchrist, M., Shore, A.C., and Benjamin, N. 2010. Inorganic Nitrate and Nitrite and Controlof Blood Pressure. Cardiovascular Research 1-7Hebels, D.G.A.J., Brauers, K.J.J., van Herwijnen, M.H.M., Georgiadis, P.A., Kyrtopoulos, S.A.,Kleinjans, J.C.S., and de Kok, T.M.C.M. 2011 Time-Series Analysis of agent Expression Profiles Induced by Nitrosamides and Nitrosamines Elucidates Modes of Action Underlying their Genotoxicity in Human Colon Cells. Toxicology Letters 207 232-241.Herrmann, S.S., Duedahl-Olesen, L. and Granby, K. 2015. happening of Volatile and Non-Volatile N-nitrosamines in process Meat Products and the Role of Heat Treatment. Food Control 48 163-169Larsson, S.C., Bergkvist, L., and Wolk, A. 2006. Processed Meat Consumption, DietaryNitrosamines and Stomach Cancer Risk in a Cohort of Swedish Women. International Journal of Cancer 119 915919.Levallois, P., Ayotte, P., Van Maanen, J.M.S., Desrosiers, T., Gingras, S., Dallinga, J.W.,Vermeer, I.T.M., Zee, J., and Poirier, G. 2000. Excretion of Volatile Nitrosamines in a Rural Population in Relation to Food and Drinking Water Consumption. Food and Chemical Toxicology 38 1013-1019.Loh, Y.H., Jakszyn, P., Luben, R.N., Mulligan, A.A., Mitrou, P.N. and Khaw, K.T. 2009. N-nitroso Compounds and Cancer Incidence The European Prospective Investigation into Cancer and Nitrition (EPIC) Norfolk Study. American Journal of Clinical Nutrition 93 1053-1061Mestankova, H., Schirmer, K., Canonica, S. and von Gunten, U. 2014. Development ofMuta genicity During abasement of N-nitrosamines by Advanced Oxidation Processes. Water Research 66 399-410.Ravnum, S., Runden-Pran, E., Fjellsbo, L.M., and Dusinska, M. 2014. Human Health Risk judicial decision of Nitrosamines and Nitramines for Potential Application in CO2 Capture. Regulatory Toxicology and Pharmacology 69 250 255.Shibamoto, T. and Bjeldanes, L. Introduction to Food Toxicology, sustain Edition. UKAcademic Press 267Stuff, J.E., Goh, E.T., Barrera, S.L., Bondy, M.L., and Forman, M.R. 2009. Construction of anN-nitroso database for assessing dietary intake. 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