Extract from the financial statements of Megablast Ltd regarding corporate governance: 'Mr Tidyman is the Chief Executive Officer and board chairman of Megablast. He appoints and maintains a board of six executive and two non-executive directors, one of whom is his father, the former Chairman of Megablast, Sir Roger Tidyman.
The board sets performance targets for the senior managers in the company but there are no formal targets for directors and the company does not have a remuneration committee. Mr Tidyman carries out a review of board policies annually in conjunction with the non-executive directors. Salaries for executive directors are set and paid by Mr Tidyman based on his assessment of all the board members, including himself. There is no formal measure of actual performance of individual directors. Internal controls in the company are monitored by the senior accountant, although detailed review is assumed to be carried out by the external auditors; Megablast does not have an internal audit department. Annual financial statements are produced, providing detailed information on past performance.'

Required:

Write a report for Mr Tidyman:

(a) Explain why Megablast does not meet international codes of corporate governance.

(b) Explain why not meeting the international codes may cause a problem for Megablast.

(c) Recommend any changes necessary to implement those codes in the company.