Corporate Governance Harvard Case Solution & Analysis

CGI

Disclosure

The basic reason for drafting such policy is to make sure those executives of the GCI and other reporting insiders, who have the proper access to the all the undisclosed information regarding GCU must comply with the internal trading rules and regulations. As per the policy draft, people who have been allowed access to the CGI’s material information are only allowed to trade and deal with the CGI securities. The period that needs to follow for this is act starts from the third business day actually followed by the quarterly financial figures and by fiscal year results. The ending takes place on the fourteen calendar day at the end of fiscal quarter. The blackout tenures may also be suggested as per the requirements on time to time basis. These suggestions are given as a result of special circumstances related to organization, when insiders should be prevented from trading in the CGI’s securities. For example, the expiry date of the stock option occurs during the blackout periods or within the ten working business days so the actual date of expiry of the stock option will be the 10th day, which is followed by the extinction of the blackout period.

Board composition

The board of directors is appointed by shareholders. The board of directors has to perform various tasks for day to day management of the organization of the company in compliance with the Operations Management Frameworks of the company, which has been agreed by the board of directors. Sometimes the size and overall composition of standing committees and board of directors is dependent on the circumstances of the organization and it looks at the board of directors as an independent decision making and efficiently working body. There is a corporate governance committee, which works under the leadership and full support of the board of directors. This committee is responsible for handling the daily corporate governance matters and makes recommendations for the board of directors. This committee also conducts a well-organized self assessment procedure for the board of directors, the standing committees and for some individual directors.

The board of directors is appointed in every annual general meeting. Shareholders actually elect the members of the board. They give them the complete authority to manage and look after the company’s management and its affairs for the coming year. The board of directors possesses the vital and exclusive power as well as influence to award the PSUs underneath the PSU Plans and to understand the terms and conditions of the PSUs that have been actually awarded.

A 4,000 stock grant has been offered to the newly elected members of the board of directors, specifically to those who are appointed for the first time. These stocks are offered on the date of their appointments. Under the share option plan, members of the board receive a grant of 4,000 stocks annually. It is the core responsibility of the board of directors to report about each and everything to the shareholders at the annual general meeting. Mrs. Paule Doré holds the office of the lead director and Mr. Thomas P. d’Aquino holds the office of the chair of the committee. Both of these personalities are independent directors. During the fiscal year 2013, the committee met three times.
Shareholder relations

CGI has always been found interested in taking a very good care of their three stakeholder groups. For this purpose, CGI has implemented a SPMF that sounds different from companies’ ISO certification. In the common course of operations, there are certain corporate actions, which are material to CGI are kicked-off time to time by the company’s high level management and, at the suitable time, they are presented to CGI’s Board of Directors for thoughtfulness and approval. When suitable, such issues are also submitted for contemplation and approval by shareholders of CGI. It is the core responsibility of the board of director to report about each and everything to the share holders at the annual general meeting.

All major approvals are analyzed and approve in accordance with the agreement of the board of directors and their standing committees, applicable corporate and securities legislation and under the light of the CGI’s corporate governance practices.  Mrs. Serge Godin is the founder of the CGI and André Imbeau is working as the Executive Chairman of the Board.  The corporate secretaries and vice chairman were the members of the board of directors till Dec 13, 2013.

Committee effectiveness

There are different committees, who work under the supervision of the board of directors. This committee includes Standing Committee, audit and risk management committee, human resources committee and corporate governance committee. These committees conduct self-assessments test and analyze the business performance. They work as a right hand of the board of director board of directors and present them the valuable suggestions. There is a corporate governance committee, which works under .........................

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