Zambia plc is a medium sized public company specialising in the manufacture of motor vehicles equipment. The board of directors consists of Patson Harris who is the chairman, CEO Margaret Burns, Finance director Peter Perry, all of whom are siblings, and five other unrelated executive directors. All directors receive bonuses based on sales.

The company's sales are made by individual salesmen and women, each of whom have authority to bind the company into contracts of unlimited value without the need to refer to a superior or consult with other departments. It is this flexibility that has enabled the company to be profitable in the past years.

However, a number of bad contracts in the current year have meant that the Finance Director has re-classed them as 'costs' to maintain healthy sales and to protect the directors' bonuses.

Discuss the corporate governance issues at this company.