Governance and Ethics KASNEB Notes

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CS PART 3 SECTION 5

COURSE OUTLINE

GENERAL OBJECTIVE

This paper is intended to equip the candidate with the knowledge, skills and attitudes that will enable him/her to practice good governance and comply with ethical principles.

LEARNING OUTCOMES

A candidate who passes this paper should be able to:

  • Apply leadership principles in the context of good governance and ethics
  • Explain the tenets and principles of good governance and ethics
  • Describe the role and functions of the board of directors
  • Demonstrate adherence to ethical principles in the organisation
  • Understand the best practices required to be adopted in good governance

CONTENT

Introduction

  • Definition of governance and ethics
  • Importance of governance and ethics
  • Principles of good governance
  • Types of governance
  • Evolution of corporate governance

Theories of governance and ethics

  • Agency theory
  • Stewardship theory
  • Stakeholder theory
  • Resource dependence theory
  • Legitimacy theory
  • Political theory
  • Transaction cost theory
  • Deontology theory (consequence based)
  • Utilitarianism theories (duty based)
  • Rights theory (contract based)
  • Virtues Theory (character based)

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Board governance models

Nonprofit governance models

  • Advisory board
  • Patron governance model
  • Cooperative model
  • Management team model
  • Policy board model
  • Fund raising board model

Corporate governance models

  • Traditional Model
  • Carver board model
  • Cortex board model
  • Consensus board model
  • Competency board model

Family owned businesses

Independent offices and constitutional commissions

The Board of Directors

  • Appointment, composition and size
  • Role and functions
  • The Role of the Chairperson
  • Executive, non-executive and independent directors
  • Committees of the Board
  • Board meetings
  • Board work plan
  • Board induction and continuous skills development
  • Board manual and charter
  • Board performance evaluation
  • Board remuneration
  • Term limits for non-executive Board members
  • Succession planning
  • Liability and insurance indemnity
  • Appointment of the Chief Executive Officer
  • Appointment of the Certified Secretary
  • Separation of roles
  • Role of the Board in performance management

Accountability, risk management and internal control

  • Financial reporting
  • Integrated reporting
  • Strategies and processes in enterprise risk management
  • Board’s role in enterprise risk management
  • Internal controls
  • Internal auditor
  • Audit Committee
  • External auditor
  • Internal audit charter and work plan
  • Procurement process

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Sustainability and social investment

  • Sustainability goals and strategy
  • Triple bottom line
  • Social responsibility investments
  • Corporate social responsibility
  • Environmental management
  • Ethical issues in CSR
  • Strategies and policies on CSR
  • Creating and registering foundations to manage CSR
  • The impact of CSR on shareholder value
  • Social audit
  • Corporate reputation and image

Ethics and corporate disclosure

  • Ethical norms, morality, values and ethical culture
  • Role of the board in promotion of ethical conduct
  • Professional judgement
  • Code of ethics
  • Standards of conduct and personal integrity
  • Ethical dilemmas
  • Ethics committee
  • Ethics training
  • Conflict of interest and related party transactions
  • Insider trading
  • Policy and guidelines on payments and gifts
  • Corporate disclosure policy and strategy
  • Benefits of disclosures and transparency
  • Disclosure barriers
  • Financial and non-financial disclosures
  • Whistle blowing

Stakeholders management

  • Stakeholder groups
  • Shareholders and stakeholder rights and interests
  • Shareholders and stakeholder obligations
  • Minority shareholders
  • Stakeholders engagement
  • Stakeholders dispute resolution
  • Shareholders association and education
  • The Role of institutional investors in corporate governance
  • Institutional investors’ relationship with investee companies

Compliance with laws and regulations

  • Overview of the legal and regulatory framework on governance and ethics in Kenya
  • Constitutional provisions on governance and ethics
  • Compliance strategy
  • Legal and compliance audit
  • Role of ICS in promotion of governance and ethics
  • Role of ICPAK in financial governance
  • Role of Ethics and Anti-Corruption Commission
  • Role of CMA, NSE and SCAC in promotion of governance and ethics

Contemporary issues in governance and ethics

  • Convergence of corporate governance
  • Role of ICT
  • Virtual organisations/cyber company model
  • Governance audit

Case studies in governance and ethics

    Emerging issues and trends

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