Assessment brief number (and title where applicable):

Module lecturer: Prof. William Coffie

Academic Year: 2020/21 Semester One.

Assessment detail approved at validation (as amended by module modification)

Module code & title		MSAF627	Corporate Financial Management
	Module Learning outcomes:				Tick if tested here
LO	Demonstrate an appreciation of the core principles of corporate governance and agency theory.
Assessment types				Weightings (%)
Independent research-based group work				60

Important requirements

Mode of Working: Group (Minimum 5 and maximum 7 in a group)

Presentation Format: Report and Oral Presentation

Requirement to pass: C

Hand in/Presentation	Report to be submitted via Sakai by 5pm on 30th April 2021 Oral presentation on 1st April 2021
Re-sit/retrieval date	tba
Assessment limits	Report of 1,500 words 10 minutes power point presentation based on the report.

Always keep a copy of your work.

Always keep a file of working papers (containing for instance copied journal article and early drafts of your work, etc.) that show the development of your work and the sources you have used.

Avoid academic misconduct

Warning: Collusion, plagiarism and cheating are very serious offences that can result in a student being expelled from the University. The business school has a policy of actively identifying students who engage in academic misconduct of this nature and routinely applying detection techniques including the use of sophisticated software packages.

Avoid Collusion: The business school encourages group working, however to avoid collusion always work on your own in order to complete your individual assessments. Do not let fellow students have access to your work before it is submitted and do not be tempted to access the work of others. Refer to your module if you do not understand or you need further guidance.

Avoid Plagiarism: You must use available and relevant literature to demonstrate your knowledge of a subject, however to avoid plagiarism you must take great care to acknowledge it properly. You should therefore always use of the Harvard style referencing system in all cases. Plagiarism is the act of stealing someone else's work and passing it off as your own. This includes incorporating either unattributed direct quotation(s) or substantial paraphrasing from the work of another/others. For this reason it is important that you cite all the sources whose work you have drawn on and reference them fully in accordance with the Harvard referencing standard. (This includes citing any work that you may have submitted yourself previously). Extensive direct quotations in assessed work is ill advised because I t represents a poor writing style that is unlikely to meet the pass grade marking criteria, and it could lead to omission errors and a plagiarism offence could be committed accidentally.

Avoid the temptation to cheat: There are temptations on the internet for you to take short cuts. Do not be tempted to either commission work to be completed on your behalf or search for completed past academic work.

When you submit your work you will be required to sign an important declaration that: the submission is your own work, any material you have used has been acknowledged and referenced, you have not allowed another student to have access to your work, the work has not been submitted previously, etc.

Assessment Brief/ Task

The detailed requirements for this task are as follows:

Enron Corporation (former NYSE ticker symbol ENE) was an American energy, commodities, and services company based in Houston, Texas. Before its bankruptcy on December 2, 2001, Enron employed approximately 20,000 staff and was one of the world's major electricity, natural gas, communications, and pulp and paper companies, with claimed revenues of nearly $101 billion during 2000. Fortune named Enron "America's Most Innovative Company" for six consecutive years. At the end of 2001, it was revealed that its reported financial condition was sustained substantially by an institutionalized, systematic, and creatively planned accounting fraud, known since as the Enron scandal. Enron has since become a well-known example of willful corporate fraud and corruption. The scandal also brought into questions the accounting practices and activities of many corporations in the United States and was a factor in the creation of the SarbanesOxley Act of 2002. The scandal also affected the greater business world by causing the dissolution of the Arthur Andersen (AA) accounting company.

Enron filed for bankruptcy protection in the Southern District of New York during late 2001 and selected Weil, Gotshal & Manges as its bankruptcy counsel. It ended its bankruptcy during November 2004, pursuant to a court-approved plan of reorganization, after one of the most complex bankruptcy cases in U.S. history. A new board of directors changed the name of Enron to Enron Creditors Recovery Corp., and emphasized reorganizing and liquidating certain operations and assets of the pre-bankruptcy Enron. On September 7, 2006, Enron sold Prisma Energy International Inc., its last remaining business, to Ashmore Energy International Ltd. (now AEI).

Tasks:

1. Discuss the corporate governance failure leading to the collapse of Enron.
2. Discuss the role of audit firm AA and failure of the accounting profession leading to the collapse of Enron.
3. Discuss whether a coded law (i.e. an Act) can mitigate the problem of accounting and corporate scandals given the US example of SOX.
4. Compare and contrast voluntary based and coded-law approach to corporate governance.

Recommended Reading

This is an indicative list of journal articles on agency theory and corporate governance.

Adams, R.B., Hermalin, B.E. & Weisbach, M.S. (2010). The Role of Boards of Directors in Corporate Governance: A Conceptual Framework and Survey, Journal of Economic Literature, 48(1), 58-107,

Aguilera, R., & Cuervo-Cazurra, A. (2009) Codes of good governance, Corporate Governance: An International Review, 17(3), 376-387

Carver, J. (2010) The case for global governance theory: practioners avoid it, academics narrow it, the world needs it, Corporate Governance: An International Review, 18(2), 149-157

Daily, C.M., Dalton, D.R. and Cannella, Jr, A.A., (2003) Corporate governance: decades of dialogue and data, Academy of Management Review, 28 (3), 371-382

Dalton, D.R., Daily, C.M., Ellstrand, A.E., and Johnson, J.L. (1998) Meta-analytic review of board composition, leadership structure, and financial performance, Strategic Management Journal, 19, 269-280

Dalton, D.R., Daily, C.M., Certo, S.T., and Roengpitya, R., (2003) Meta-analyses of financial performance and equity: fusion or confusion? Academy of Management Journal, 46 (1), 13-26

Dalton, C.M. and Dalton, D.R., (2005) Boards of directors: utilizing empirical evidence in developing practical prescriptions, British Journal of Management, 16, S91-97

Durisin, B. & Puzone, F. (2009) Maturation of corporate governance research, 1993-2007: An assessment, Corporate Governance: An International Review, 17(3), 266-291

Garcia-Castro, R., Aguilera, R.V. & Arino, M.A. (2013) Bundles of corporate governance practices: A fuzzy set analysis, Corporate Governance: An International Review, 21(4), 390-407

Hermalin, B.E. and Weisbach, M.S. (2003) Boards of directors as an endogenously determined institution: a survey of the economic literature, Economic Policy Review, 9 (1), 7-26

Jensen, M.C., and Meckling, W.H., (1976) Theory of the Firm: Managerial behaviour, agency costs and ownership structure, Journal of Financial Economics, 3, 305-360

Yoshikawa, T. & Rasheed, A.A. (2009) Convergence of corporate governance: Critical review and future directions, Corporate Governance: An International Review, 17(3), 388-404

Zattoni, A., & Cuomo, F. (2008) Why adopt codes of good governance? A comparison of institutional and efficiency perspectives, 16(1), 1-15

Zattoni, A. & Van Ees, H. (2012) How to contribute to the development of a global understanding of corporate governance? Reflections from submitted and published articles in CGIR, Corporate Governance: An International Review, 20(1), 106-118

The Committee on the Financial Aspects of Corporate Governance, Chaired by Sir Andrian Cadbury (1992).

Directors Remuneration Report of study group chaired by Sir Richard Greenbury (1995).

The Combined Code Principles of Good Governance and Code of Best Practice Chaired by Sir Ronald Hampel (1998)

Checklist of issues to consider: