Risks of Noncomplinace in Corporate Governance

Running Head: Risks of Noncompliance in Corporate Governance

Risks of Noncompliance in Corporate Governance

Kicia Robinson

University of Phoenix

MMPBL 570/Corporate Governance

Introduction

Corporations such as Enron, WorldCom, and Tyco forced Congress to pass the Sarbanes-Oxley Act (SOX) because of mismanagement and fraud. This new law requires financial reporting and disclosure within corporate governance. McBride Financial Services, Inc. (MFSI) will need to meet the expectations of investors by developing sound corporate governance and find solutions that will address any issues of non-compliance in corporate governance.

Within this paper will be a compare and contrast of a variety of corporate governance compliance recommendations that can help MFSI remain successful. In this paper, Team B will also discuss how three companies use committees as part of corporate governance and how MFSI can use committees to mitigate the risks involved with non-compliance.

Compare and Contrast Compliance

Independent Board of Directors

In a time of chronic uncertainty, no one person or group, despite how versed will reasonably be able to predict or manage the full set of risks that can blanket an enterprise (McCarthy, Flynn, & Brownstein 2004); therefore, it is recommended that McBride Financial Services Inc. (MFSI) hire an independent board chair and Beltway Investments to mitigate risk of noncompliance. Hugh’s initial communications pertaining to sound corporate governance are questionable compared to Securities and Exchange Commission (SEC) requirements. It is imperative to remain compliant with the SEC regulations to alleviate fines, increased government oversight, shareholders distrust, and criminal charges.

The lofty goal of breaking even (University of Phoenix) set by Hugh will keep him occupied with day-to-day operations as Chief Executive officer (CEO). Therefore, a board of directors will be focused on overseeing sound corporate...