Question 1

Corporate governance, sustainability, and risk management practices are crucial for
companies like JKL to ensure their long-term success and stability. In this report, I will
discuss three good corporate governance practices that I believe would be relevant to JKL
and how they could be beneficial for the company.

a) Board diversity & Independence

 Board diversity: A diverse board of directors with a mix of gender, race,

ethnicity, and skillset can bring in a range of perspectives and experiences that
can help the company make informed decisions and tackle challenges
effectively. A diverse board can also help JKL appeal to a wider customer
base and improve its reputation.

 Board independence: It is important to have an independent board of

directors to provide oversight and ensure the interests of all stakeholders are
being considered. For JKL, this could involve the appointment of independent
directors who have the skills and expertise to provide effective oversight and
regular evaluations of the board's performance. (Doesn’t have to be family
members?

b) Clear and transparent reporting: JKL should ensure that its reporting is clear,
transparent, and in compliance with relevant regulations. This can help build trust
with stakeholders, including investors, customers, and employees, and prevent any
potential legal or reputational risks. For JKL, this would mean regularly reporting on
its financial performance, operations, and strategic plans, and being transparent about
key business risks and mitigation strategies.

c) Effective risk management

JKL should have a robust risk management system in place to identify and mitigate
potential risks, such as market changes, economic downturns, or changes in
regulations. This can help protect the company’s financial stability and ensure its
long-term success.

 Risk identification: JKL should regularly identify and assess potential risks
that could impact its business operations, such as market changes, supply
 chain disruptions, or natural disasters. This can be achieved by implementing a
robust risk management framework and regularly reviewing and updating it.

 Risk mitigation: JKL should implement measures to mitigate risks that have
been identified, such as developing contingency plans, securing backup
systems, or diversifying its supply chain. This can help to reduce the impact of
risks and ensure business continuity.

 Risk monitoring: JKL should regularly monitor and review its risk
management practices to ensure that they remain effective and relevant. This
can be achieved through implementing regular audits and performance
assessments, as well as through engaging with stakeholders to understand their
perspectives on risk.

d) Stakeholder engagement: Good corporate governance also involves engaging with

stakeholders and considering their interests. For JKL, this would mean regularly
engaging with employees, customers, suppliers, and other stakeholders to understand
their concerns and perspectives, and taking their interests into account in decision-
making.

Benefits of having a sustainability strategy for JKL

A sustainability strategy provides a roadmap for a company's sustainability efforts and helps
to ensure that sustainability is integrated into the company's operations and decision-making
processes.

Here are some benefits of having a sustainability strategy for JKL:

a. Improved sustainability performance: A sustainability strategy provides a clear

framework for the company's sustainability efforts and helps to ensure that
sustainability is integrated into all aspects of the business. This can lead to improved
sustainability performance, as the company is better able to identify and address
sustainability challenges and opportunities.

b. Increased efficiency and cost savings: A sustainability strategy can help identify
opportunities for efficiency improvements and cost savings, such as reducing energy
and resource consumption, and minimizing waste. This can lead to cost savings, and
improve the company's competitiveness.
 c. Better risk management: A sustainability strategy can help improve risk
management by identifying and addressing material sustainability risks and issues,
and by demonstrating how these are being managed. This can help to mitigate risks
and ensure the long-term sustainability of the business.

d. Enhanced reputation and brand image: A sustainability strategy can help improve
a company's reputation and brand image by demonstrating its commitment to
sustainability, and by communicating its sustainability performance in a transparent
and credible manner.

e. Increased stakeholder trust: A sustainability strategy can increase stakeholder trust

by providing information on the company's sustainability practices and performance,
and by demonstrating its commitment to transparency and accountability.

f. Improved stakeholder engagement: A sustainability strategy can enhance

stakeholder engagement by providing a platform for stakeholders to share their views
and feedback on the company's sustainability performance and practices.

g. Increased competitiveness: A sustainability strategy can increase competitiveness by

demonstrating the company's commitment to sustainability, and by highlighting its
sustainability performance relative to its peers. This can be particularly valuable in
attracting investment and talent to the company.

Importance of risk management in the context of a company like JKL

Risk management is important for a company like JKL, as it helps the company to identify,
assess, and mitigate potential risks that could impact its operations and financial performance.
The benefits of effective risk management for JKL include:

1. Improved decision-making: By considering potential risks and their impact, JKL

can make informed decisions that better balance risk and reward.

2. Increased certainty and stability: Effective risk management can provide greater
certainty and stability for JKL, as the company is better prepared to respond to
potential risks and minimize their impact. These risks can have a significant impact on
the business, and it is important to identify and manage these risks effectively to
ensure the long-term sustainability of the business.
 3. Enhancing resilience: Risk management helps to enhance resilience by ensuring that
the company is prepared for unexpected events, such as natural disasters, market
changes, or regulatory changes. This helps to ensure that the business can continue to
operate and grow, even in challenging circumstances.
4. Protecting the business: Risk management helps to protect the business by
identifying and managing potential risks, and by putting in place measures to mitigate
or avoid these risks. This can help to ensure the stability and long-term viability of the
business.
5. Meeting stakeholder expectations: Risk management is important for meeting
stakeholder expectations, as stakeholders are increasingly concerned about the risks
associated with companies and the measures they are taking to manage these risks. By
demonstrating a commitment to risk management, JKL can enhance its reputation and
increase stakeholder trust.

6. Compliance with laws and regulations: Effective risk management can help JKL
comply with laws and regulations, such as those related to health and safety, data
privacy, and environmental protection.

In conclusion, the above-mentioned corporate governance practices can help JKL

regardless of whether the company transitions into an ASX-listed entity. Implementing
these practices can improve JKL’s reputation, attract investors, and ensure its long-term
stability.

N/B 1087 words

Question 2

Significance, benefits and challenges of producing a sustainability report for JKL

The significance of producing a sustainability report for JKL, a business within the
land/water remediation industry, is that it provides a comprehensive overview of the
company's environmental, social, and governance (ESG) performance, and demonstrates its
commitment to sustainability.
The benefits of producing a sustainability report include:

1. Improved reputation and brand image: A sustainability report can help improve a
company's reputation and brand image by demonstrating its commitment to
sustainability, and by communicating its sustainability performance in a transparent
and credible manner.

2. Better decision-making: A sustainability report can provide valuable information

and insights to help inform decision-making, by providing a clear understanding of
the company's sustainability performance and opportunities for improvement.

3. Increased efficiency and cost savings: A sustainability report can help identify
opportunities for efficiency improvements and cost savings, by providing information
on the company's energy and resource usage, and by highlighting areas where
sustainability improvements can lead to cost savings.

4. Improved risk management: A sustainability report can help improve risk

management by identifying and addressing material sustainability risks and issues,
and by demonstrating how these are being managed.

5. Enhanced stakeholder engagement: A sustainability report can enhance stakeholder

engagement by providing a platform for stakeholders to share their views and
feedback on the company's sustainability performance and practices.

6. Increased competitiveness: A sustainability report can increase competitiveness by

demonstrating the company's commitment to sustainability, and by highlighting its
sustainability performance relative to its peers.

The challenges of producing a sustainability report include:

1. Measuring and reporting on sustainability performance: It can be challenging to

accurately measure and report on sustainability performance, especially in industries
like land/water remediation that have complex and interrelated impacts.

2. Integration with business strategy: It can be challenging to integrate sustainability

into the company's overall business strategy, and to ensure that sustainability
considerations are integrated into decision-making processes.
 3. Balancing short-term and long-term considerations: A sustainability report must
balance short-term business objectives with long-term sustainability goals, and ensure
that sustainability is not compromised for the sake of short-term financial gain.

4. Addressing negative impacts: A sustainability report must be transparent about the

company's negative impacts and provide information on how these are being
addressed.

5. Keeping pace with changes: The sustainability landscape is constantly evolving, and
companies must keep pace with changes in sustainability practices, regulations, and
stakeholder expectations.

6. Ensuring data quality and reliability: It can be challenging to ensure the quality
and reliability of sustainability data, especially where data is collected from multiple
sources.

7. Managing stakeholder expectations: Stakeholder expectations of sustainability

performance can be challenging to manage, as different stakeholders may have
different priorities and expectations.

8. Communicating sustainability performance effectively: A sustainability report

must be written in a clear and concise manner, and must effectively communicate the
company's sustainability performance to a range of stakeholders, including investors,
customers, employees, and the wider community.

Key elements that should be included in a sustainability report for the land/water
remediation industry include:

1. Environmental performance: This should include information on the company's

environmental impact, such as greenhouse gas emissions, water usage, and waste
management practices.

2. Social performance: This should include information on the company's social

impact, such as employee engagement, community engagement, and human rights.

3. Governance performance: This should include information on the company's

governance practices, such as board independence, risk management, and stakeholder
engagement.
 4. Performance metrics and targets: The report should include performance metrics
and targets, and an explanation of how the company is tracking against these targets.

5. Biodiversity and conservation: This should include information on the company's

efforts to protect and conserve biodiversities, such as programs to protect threatened
species and habitats, and contributions to conservation initiatives.

6. Stakeholder engagement: This should include information on the company's efforts

to engage with stakeholders, such as customer feedback mechanisms, community
consultation processes, and stakeholder forums. N/B 649 words

Question 3

There are several key risks for a company like JKL including:

 Market risk: Market risk refers to the potential impact of changes in market
conditions on a company's sales and profitability. For example, if JKL operates in a
highly competitive market and its competitors introduce new products or lower prices,
JKL's sales and market share could be impacted. To mitigate this risk, JKL could
consider diversifying its product portfolio, researching new markets, or developing
new distribution channels.
 Operational risk: Operational risk refers to the potential impact of unforeseen events
on a company's operations. For example, a natural disaster such as a hurricane could
disrupt JKL's supply chain, or a key piece of equipment could fail, causing downtime.
To mitigate this risk, JKL should have contingency plans in place, such as backup
systems, backup suppliers, and emergency response plans.
 Financial risk: Financial risk refers to the potential impact of financial events on a
company's finances. For example, if JKL experiences cash flow problems, it may not
be able to pay its bills or make necessary investments.

Benefits of Minimizing Risks

 Increased stability: By reducing risk, a company can ensure that its operations and
finances are more stable, even in uncertain economic conditions.
 Improved profitability: By identifying and mitigating potential risks, a company can
ensure that its investments and operations are more efficient and effective.
  Enhanced reputation: Companies that effectively manage risk are viewed
favourably by investors, customers, and stakeholders, which can improve the
company's reputation.
 Increased competitiveness: Minimizing risk can also help a company increase its
competitiveness by improving its operations, financial performance, and reputation.
 Better decision-making: Effective risk management processes can provide a
company with a better understanding of its risks, allowing it to make better-informed
decisions and respond more quickly to potential risks.

Actions JKL should take to minimize risk:

 Implement effective risk management processes: Create a risk register, develop

risk mitigation plans, and regularly review and update the risk management process.
 Maintain strong financial controls: Regularly monitor financial performance and
cash flow, maintain strong financial controls, and seek advice from financial experts if
necessary.
 Diversify product and market portfolios: Spread risk across different products,
markets, and customer segments.
 Build a resilient supply chain: Have multiple suppliers, regularly monitor the supply
chain, and implement contingency plans in case of disruptions.
 Communicate risk management strategy: Clearly communicate the company's risk
management strategy to employees, stakeholders, and customers to ensure that
everyone is aware of the company's risk management process and objectives.
 Continuously monitor and review: Continuously monitor and review the company's
risk management process to ensure that it remains effective and relevant
(430 words)
Risk

1. "Enterprise Risk Management: From Incentives to Controls" by James Lam

2. "Risk Management and Financial Institutions" by John C. Hull

3. "The Handbook of Corporate Financial Risk Management" edited by Stavros A.

Zenios and Charalambos D. Alimisis

4. The Project Management Institute's "Guide to the Project Management Body of

Knowledge (PMBOK)"

5. The Institute of Risk Management's "Risk Management Standard"

Here are some references for corporate governance practices:

"Corporate Governance: Principles, Policies, and Practices" by Bob Tricker

"The Oxford Handbook of Corporate Governance" edited by Christopher Gaden and Jennifer
Hill

"Corporate Governance Matters: A Closer Look at Organizational Choices and Their

Consequences" by David Larcker and Brian Tayan

"The Corporate Governance Handbook: Strategies, Implementation and Performance" edited

by Rebecca Hansch and Knut Olsen

The Organisation for Economic Co-operation and Development (OECD) Principles of

Corporate Governance

Here are some references for sustainability reporting and the land/water remediation
industry:

"Sustainability Reporting: A Global Overview" edited by Richard Welford and Ksenia

Petelina

"The Sustainability Handbook: The Complete Management Guide to Achieving Social,

Economic, and Environmental Responsibility" by John Elkington

"The Global Reporting Initiative (GRI) Standards"

"The United Nations Global Compact: Corporate Sustainability Framework"

The Sustainability Accounting Standards Board's (SASB) sustainability reporting standards

for the land/water remediation industry.