CCA is public company and is recently listed on a stock exchange with more

than 20 shareholders. They have been attempting to comply with corporate

governances codes but does not have boarder knowledge on it. You have been
provided following info by the company:
BOD of the CCA are too concern for the development and growth and they think
conducting AGM are just a time consumer and has not been conducting AGM rather
has been focusing on daily operating efficiency which they think will lead to business
growth.
BOD is comprised of Mr. Diwas Silwal (Finance Director of CCA), Mr. Manish Sharma
(Marketing Director), Mr. Govinda Raj Panta (Chief Executive Officer), Sharada
rajbhandari(ED), Pratik K.C. (ED) Mr. Sujan Aryal(NED) Mr. Sujit sharma( NED) and
Mr. Pramod Khadka (NED), which is leaded by Mr. Govinda Raj Panta. CCA thinks that
appointing their friends and relatives will help them to grow their business and most of
ED are either each other’s friends or relatives and are appointed by CEO.
CCA acknowledged the fact that audit committee requires one finance expertise and
composition is made up of Diwas silwal, Sujan Aryal and Sujit Sharma. Mr. Diwas Silwal
sets the remuneration package, wages payment, salary improvement of every staffs.
Mr. Govinda Raj Panta can appoint the auditor and even can revoke. Tenure of the
Director are not specified and they can work as much they like which will improve their
knowledge on company and contribute more on its growth.
a) Identify and explain the weakness in CCA regarding corporate Governance
Practice and recommend actions that should be taken to remedy the weakness.
( Identify as many as you can)
Note:
(This is just a simple illustration of Corporate Governance question in simple words
prepared by self to understand it independently. Use of any known names are usually
prohibited but they are used to attract the question. Please Don’t circulate this question
to unauthorized Third Party.)

Answer:
Weakness Recommendation