Native Americans in California Missions Essay Example for Free

Native Americans in California Missions Essay Spanish wanted to colonize some of America, just like the Europeans. Building religious based Missions all throughout California was a way for them to maintain ultimate social, political, and economic control. Spanish explorers arrived on the border of California during the 16th century. The very first Franciscan mission was built in San Diego during 1769. By 1833, twenty two Spanish Missions existed from Southern California to Northern California. Native Americans made up about one-third of those who lived and worked at the Missions. There were an estimated 310,000 Indians living in California during the 16th century. The Spanish provided the Native Americans with the necessities such as food, clothing, and shelter. Although the California Missions had the right intentions of providing for the Native Americans, the Spanish acted in an inhumane and unfair way. Junipero Serra arrived in San Diego in 1768 and lead a group of Franciscans to find property and more importantly, workers. He welcomed the Native Americans with open arms and open doors. In a primary document written by Junipero Serra himself, he admitted that he used the Native Americans solely for work. However, he said that providing them with food and shelter compensates for their hard work. â€Å"So if families other than Indian come from there, it will serve the same purpose very well—that is, if we can provide for them†¦Ã¢â‚¬ (Serra). Serra’s defenders state that he respected the Natives’ culture. However, his criticizers argue that he used force to urge the Native Americans to live at the Missions against their will. Although the Natives did not agree with Serra’s beliefs and actions, they were very respectful for the most part. For those who did not respect Serra received physical punishment with â€Å"whips, chains, and stocks to enforce religious obedience† (Serra). Junipero Serra was a great leader who made sure the California Missions were in order. The California Mission had worthy intentions and plans for the Native Americans. The Spanish welcomed them into their ‘homes’ and provided them with the essentials such as food, clothing, and shelter. However, living at the Missions had its consequences. The Native Americans were forced to change their entire lifestyles – from their beliefs, their daily routines, to the way they dressed and what they ate. Although anthropologists conducted that some Native Americans enjoyed their new lives, more than eighty percent refused to convert their ways of life (Sandos, 13). For thousands of years, the Natives were accustomed with their own lifestyle and beliefs, and all of a sudden, everything was stripped away from them. Even their personal identity was taken away from them. The Franciscans provided each individual with Spanish names which were to be used instead of their native birth names. â€Å"The missions were not agents of intentional enslavement, but rather rapid and therefore violent social and cultural change† (Archibald, 24). The Native Americans ended up becoming tax pay citizens along with being under Spanish wing twenty-four hours a day, seven days a week. The Franciscans had very different beliefs and traditions from the Native Americans. The Native Americans were forced to convert their religion to Roman Catholics. The Native Americans were more of a â€Å"spiritual† group rather than a religious group. Instead of believing in personified figures, such as Jesus, they believed spirits lie within their nature. Native Americans feed their energy off of nature. They believed that they are protected by the Mother Nature that surrounded them. The Spanish used religion to explain their actions, which made it ‘okay’ for them to convert the Native American’s beliefs because they were backed up by their god (California). Every person living and working at the Mission had to be officially baptized as a rite of passage. On Sundays and holidays everyone was obligated to go to church and worship. The Natives were forced to memorize Catholic rituals, songs, and scriptures. Prayer lasted four hours on Sundays and feast days. On a regular basis on typical days, prayer lasted two hours. Catholicism was a huge part of living at the Missions. The Missions were surrounded by Spanish soldiers so everyone was watched very closely. Once the Native Americans accepted the Spanish lifestyle, it was nearly impossible to escape. It was as if they were held against their own will. A few sources compare the treatment of Native Americans to slavery (Archibald, 48). Slavery is defined as an economic exploitation that benefits only the slave-owner. In the California Missions, the Native Americans worked solely to provide and maintain a certain lifestyle for the Spanish. Besides minimal food and shelter, the Native America’s natural human rights were stripped from them. Native America women made clothing, prepared meals, cleaned the rooms, and whatever domestic chores needed to be done at the Mission. Native American mothers even had to care for Spanish children instead of focusing on their own (Mission). The Native American men had to hunt for food and build new Missions. In addition, they learned carpentry, leatherworkers, smiths, and farm work. The Franciscans controlled their days into a rigorous schedule announced by church bells (Archibald, 104). If the workers were not done with their tasks by the chimes of the church bells, they would suffer major consequences. The Franciscans did not view their actions as imprisonment because they believed that the providence of food and shelter compensates for Natives’ hard work. In reality, the Missions were not a place to live a life of ease nor was it a place to acquire personal fortune and prosperity. The Native Americans were not worked to death like the slaves in southern United States at this time. However, the strict regulation, cruel and unusual punishments and forced new traditions are extremely inhumane acts. According to Julio Cesar, â€Å"When I was a boy the treatment given to the Indians at the Mission was not good at all. We were at the mercy of the administrator, who ordered us to be flogged whenever and however he took notion† (Mission). Every Mission had two priests. One priest’s duties were to preach and teach about religion. The other priest’s duties were strictly on the work field. He instructed and gave the Native Americans and other workers their duties. The lifestyle in the California Missions was set in a very rigorous schedule so it was nearly impossible for the Native Americans to take a break or escape the hardship. The Natives resisted colonization after just a short time living and working at the Missions. There were a few deadly rebellions conducted by the Native Americans. They destroyed Mission property and even threatened to kill priests. The most infamous attack occurred in San Diego. On November 4, 1775, hundreds of men completely destroyed the Cuiamac Rancheria Mission of San Diego. The men also killed three Hispanics, including the Father, Padre Jaime (Sandos, 92). In addition, in 1824, another great Indian rebellion in California occurred at the Missions of Barbara. A large part of the Mission building was wrecked by a large fire. On the same day, hundreds of Native Americans attacked the Spanish defenders and soldiers. Leaders of the rebellion were severely punished. Seven were executed and the others were imprisoned or required to do even crueler labor. The Natives revolted because of their poor treatment and forced labor enforced by the soldiers and Fathers (Sandos, 73). These rebellions were among the many others throughout the 16th century in the California missions. This proves that the Native Americans were furious about getting different beliefs and work forced onto them. The Spanish settlers caused a lot of health problems to flourish all throughout California. Soon after the arrival of Spanish colonists, diseases spread from Southern California to Northern California so Native American fatalities heightened. Highly infectious diseases such as smallpox, measles, and syphilis killed thousands of Native Americans, especially children, so the Indian population dropped drastically (Sandos, 64). About sixty percent of the Mission Native Americans’ death was due to introduced diseases. In just a few decades, the Native American population in California decreased from 310,000 to about 100,000. Since the California Missions held many residences, people lived in such confined spaces which caused contagious diseases to spread rapidly. In order to keep the population at a steady rate for enough workers, Mission leaders separated Native American children from their parents to maintain the children’s health to save them to work at the Missions as they got older (California). The Natives were furious that their families were being separate. Mothers were not there to care for their children, so the Native children were on their own. There was a lack of physicians to care for the ill so not everyone could be helped. Diseases were not the only reason why the Native population dropped drastically. They went through rigorous changes in diet so their bodies were not used to the food they were eating. In addition, malnutrition caused toxins in their bodies. In addition, the intense demanding manual labor is a factor that contributed to their inability to overcome the sickness. Death rates were higher than birth rates so the Mission had to keep recruiting different tribes all throughout California (Mission). By 1834, there were only about 15,000 Native American residents in the twenty two Missions. The Spanish were only in contact with the Native Americans for personal gain. The Franciscans maintained total economic, social, and political control all throughout California. Very few Native Americans chose to stay at the Missions voluntarily. During their time at the Missions, they had to conduct harsh labor and all of their rights were taken away from them. Although they provided the Native Americans with food, shelter, and clothing, the Franciscans treated them like slaves. The Spanish’s involvement backfired since a majority of Native Americans died due to illness, making them nearly extinct. The physical and metal demands required were a major strain on the Native Americans.

Effects of Corporate Scandal on Governance in the UK

Effects of Corporate Scandal on Governance in the UK 1.1 Introduction The aim of this thesis is to examine the evolution of Corporate Governance in the United Kingdom and the affects which corporate scandals had on it. This aim is achieved through the following objectives: The development of Corporate Governance in the United Kingdom. The affect of corporate scandals on stakeholders. Corporate scandals and Corporate Governance. Corporate Governance has been a source of discussion among investors and entrepreneur and it has gone through many changes in recent years. It is defined as the structures and processes for the direction and control of companies (World Bank, 2005). The importance of Corporate Governance came into enlightenment after the collapse of high profile organisation such as Robert Maxwell (Parkinson Kelly, 1999). These corporate failings lead to UK Corporate governance being improved (Iskander Chamlou, 2000). The Dramatise change in Corporate Governance affected many big organisations with a number of challenges. But the key aspect of Corporate Governance is Risk-taking is fundamental to business activity (Spira Page, 2003), which means risk taken by the organisation must be controlled properly and from here Risk Management comes in. To select Corporate Governance as a dissertation topic large amount of research activities with many sources of literature is being used. One of the major problem realised with this topic was, there was ample amount of literature available and that to is very difficult to select the most appropriate one. But problem was solved by concentrating on academic literature, which is mentioned in brief in this dissertation. The structure of this dissertation is as follows, chapter one will focus on literature review, which will provide some basis knowledge for this dissertation. The main aim of the literature review is to highlight the various factors associated with the evolution of Corporate Governance. This section will also include Corporate Governance in the USA which will only give some idea how the legislation is different in two countries. Secondly we will discuss some scandals (Arthur Andersen and Robert Maxwell). The purpose of choosing these two case is to show by which Corporate Governance reached the stage of maturity. Robert Maxwell scandal which occurred in the UK and Arthur Andersen scandal occurred in the United States, which will be the second chapter of this dissertation which actually gave the birth to Corporate Governance. And the last part of the dissertation which is third and final chapter will describe some limitation and conclusion. Chapter 1 Literature Review The aim of this section is to provide an overview in order to analyse different aspect of Corporate Governance and scandals which are linked with the aim and objective of this dissertation. This part of the dissertation will describe about, what Corporate Governance actually is, discussing definitions. Further it will present back ground, development of Corporate Governance in UK, need for Corporate Governance and Corporate Scandals. What is Corporate Governance? Corporate governance is a field in economics that investigates how to secure/motivate efficient management of corporations by the use of incentive mechanisms, such as contracts, organizational designs and legislation. This is often limited to the question of improving financial performance, for example, how the corporate owners can secure/motivate that the corporate managers will deliver a competitive rate of return, www.encycogov.com, Mathiesen [2002]. Corporate governance deals with the ways in which suppliers of finance to corporations assure themselves of getting a return on their investment, The Journal of Finance, Shleifer and Vishny [1997, page 737]. Some commentators take too narrow a view, and say it (corporate governance) is the fancy term for the way in which directors and auditors handle their responsibilities towards shareholders. Others use the expression as if it were synonymous with shareholder democracy. Corporate governance is a topic recently conceived, as yet ill-defined, and consequently blurred at the edge. Corporate governance as a subject, as an objective, or as a regime to be followed for the good of shareholders, employees, customers, bankers and indeed for the reputation and standing of our nation and its economy Maw et al. [1994, page 1]. Corporate Governance is the structures and the process for the direction and control of companies (World Bank, 2005). This definition only explain the involvement of Corporate Governance, however it fails to explain in depth about Corporate Governance. The other definition says the system by which companies are directed and controlled (Cadbury, 1992, Coyle, p4). The Organisation for Economic Co-operation and Development (OECD, 1998) explain Corporate Governance in more details it says A set of relationships between a companys board, its shareholders and other stakeholders. It also provides the structure through which the objectives of the company are set, and the means of attaining those objectives and monitoring performance are determined (United Nations, 2003, p1). If we look at the definition provided by the OECD (1998) we can say Corporate Governance involve number of parties such as stake holder, share holder and board, and the goal of an organisation can be achieved by using Corporate Governance. And lastly we can say Corporate Governance measures the performance of the company. Background Many large organisations in UK suffered because of the Corporate Governance and this was the main reason for the number of changes in it throughout the years. One of the secondary reasons for this change was the economy and society as well. In this section we will focus on this area, the change occurred in this area and the impact of these changes on corporate world. Dubbed the Enron of England, the South Sea Bubble was one of historys worst financial bubbles (Stock Market Crash! 2006). This was started in 1711, when a war felt Britain in arrears by 10 million pounds. And this debt was financed by the South Sea Company at 6% interest. A part from the interest, Britain also gave the right to trade exclusively in the South Seas. The failure of the South Sea bubble was the expectation of the directors lying about the profits, as the South Sea Company issued stock to finance its operation. Interested Investors quickly realised that company is having monopoly in the market, so the share price increased drastically from the scratch. Speculation became rampant as the share price kept skyrocketing (Stock Market Crash! 2006). And after certain period the management realized that the company share was overvalued. Well we can say that this point in time this happened because there was none of the guidance documents which are available today. Cadbury Committee told this initiative and they produce the first guidance document in the UK, which was chaired by Adrian Cadbury (Cadbury, Report, 1992). The Cadbury Committee Report included a number of financial aspects of corporate governance i.e. the role of the board, auditing and reporting of financial information to shareholders (Cadbury Report, 1992). Cadbury Committee Report was structured in such a manner that the organisations can easily follow it. Here are some outlines of Cadbury Committee Report, Section 4 deals with the structure of board, and there should be executive directors and independent non-executive directors. Section 4.11 explains the purpose of having non-executive directors. The responsibilities of directors which are mentioned in section 4.28. Internal control is discussed in section 4.31 of the Cadbury Report (1992) which provided guidance on keeping records of accounts and reducing the chance of fraud (Cadbury, 1992). Section 4.33 which explain about Audit committee and there relationship with the board members and the appointment of external auditors. However Cadbury Committee report fails to unveil directors remuneration, which leads to the introduction of the Greenbury Report. The chartered Institute of Management Accountants (1999) explains the purposes of having Greenbury Report, to encourage more transparency with the organisation. It provides guidance on directors salaries, bonuses, and also accountability (Chambers 2002). Section A of the Greenbury Report discusses about the directors remuneration and directors remuneration should be decided by a remuneration committee. This committee should include non-executive directors who will decide upon the remuneration of the directors (Greenbury, 1995, section A1). The remuneration committee should provide report to shareholders which are discuss in Section B of the Greenbury Report disclosure and approval provisions (Greenbury, 1995, section B). Section C of the Greenbury Report discuss the performance of the company with there directors. The performance- related component of remuneration should be plan to align the interest of Directors and shareholders and to give directors enthusiastic incentives to execute at the highest levels (Greenbury, 1995, section C). Section D of the Greenbury Report discusses service contracts and compensation (Greenbury Report, 1995, Section D). This part focus on, how much compensation a director is entitled in the event of lea ving the company before his/ her contract expires. This means that shareholders know accurately how much it would cost them if they are firing any one of there director or directors. Hampel and the Broadening of Control Hampels Committee on Corporate Governance (1998) resulted in both a step fore and a step back from the earlier Cadbury report. Hampel elaborated the concept of internal control business risk assessment and response, financial management, compliance with laws and regulations and the safeguarding of assets, including the minimising of fraud (Hampel, 1998, pp. 53-54). The authors clearly stated that They are not concerned only with the financial aspects of governance (Hampel, 1998, p.53). Hampel took a broad view of internal control, stating that it is the responsibility of directors to establish a robust system of risk management, to recognize and appraise potential risks in every aspect of the business operation. The control concept of Hampels was welcome by many organisations, which also include the Association of British Insurers (ABI) which recognise it a realistic approach that motivated companies to deal with their compliance with the new corporate governance requirements (Fagan, 1999). Neil Cowan, Vice President of the European Confederation of Institutes of Internal Auditing, say that Hampels view of risk management represented a welcome restatement of that part of a Boards prime responsibility for devising a strategy that will ensure the companys continued existence (Cowan, 1997). The Turnbull Report A committee chaired by Nigel Turnbull produce a new report titled, Internal Control: Guidelines for Directors on the Combined Code, under the support of Institute of Chartered Accountants in England and Wales (ICAEW, 1999), it was published less than two years after the Hampel Committee on Corporate Governance was published. The document issued by Turnbull committee filled may gaps left by Cadbury and Hampel. The report was drafting by the recommendations of the Combined Code and the underlying Hampel recommendations that directors review all controls. The main aim of the report as agreed by large organisation including ICAEW and the London Stock Exchange was to provide guidance to the listed companies and to implement the requirements in the Code relating to internal control. But the main purpose of the report was giving the relaxation to companies to explain their governance policies, the guidance obliged the board to report on the effectiveness of the companys system of internal c ontrol. This centre on internal control is attached to the idea of a dynamic company, which requires non-stop monitoring and auditing. The Report states that: A companys objectives, its internal organisation and the environment in which it operates are frequently developing and, consequence, the risks it faces are frequently altering. So there should a sound internal control system which depends on a regular assessment of the nature and extent of the risks to which the company is exposed. As profits are, in part, the prizes for successful risk-taking in business. Internal Control purpose is to help manager and control risk appropriately rather than to eliminate it. (ICAEW, 1999, p.5, para.13). Turnbull Committee involve two steps to interpret, firstly to identify the risk and how the risk is managed and evaluated. Secondly, assess the effectiveness of the internal control system, it procedure and effectiveness. Some other report which focuses on Corporate Governance in UK are Rutteman Report 1994 on Internal Control and Financial Reporting, Myners Report 2001 on Relationship between institutional investors and companies, Tyson Report 2003 on Recruitment and development of non executive directors (Chartered Institute of accountants for England and Wales, 2006). Why use Corporate Governance? The argument that the company should be subject to legal regulation at least some of their actions tends to be couched in term of Market failure. Companies are recognized to have characteristics, particularly the scale and scope of their operations, which make the market governance of their actions imperfect. The purpose of the regulation is to iron out those imperfections and to restore market governance. Now in some cases this may mean very extensive legal regulation indeed, and in exceptional cases, particularly in respect of the so-called natural monopolies, an acceptance that market governance must be abandoned in favour of economy governance. This is a topic, which is growing in importance following a number of high profile failures. In UK stock market as per Financial Aspects of Corporate Governance,1992 all listed companies need to publicly state whether or not they comply with Corporate Governance. If the Investors they are not fulfilling this requirement, they may full loss as this is an incentive for the listed companies to use Corporate Governance otherwise investors may choose to invest elsewhere. According to James Madison (Bavly, 1999) No man is allowed to be judge in his own case, because his interest would certainly bias his judgement and, not improbably corrupt his integrity described by James Madison (Bavly, 1999). Because of the Corporate Governance, companies are run in a fair and efficient manner to maximise the wealth of the organisation rather than maximise the profit and that no one person should have too much control. The Institute of Chartered Accounts for England and Wales (ICAEW, 2002) discuss the importance of Corporate Governance in more details, ICAEW (2002) explain that because of the corporate scandals, Corporate Governance came into motion or it can also be said corporate scandals is the main driver for Corporate Governance as it highlights what can actually happen and also the devastating affects. The ICAEW (2002) also indicated that because of the awareness and the increased knowledge of shareholders have lead to companies to improve there presentation in the market and also to improve the way in which they operate in order to attract investment. Shareholder influence affect the structure of an organisation (Investments) so they having a positive impact on Corporate Governance as it is a key driver for the implementation of Corporate Governance to many companies. Iskander and Chamlou (2000) explain that, to increase the market value and the market share good corporate Governance is essential. This is a key subject to consider because if the management is not performing efficiently and effectively, then money is going to be spent on agency problems, which arise. However with good Corporate Governance the board is working more consistently. Coyle (2003/2004) explains that there is also a difference of interest between directors of a company and its shareholders. The directors need to earn more benefits and high remuneration whereas the shareholders want the company to be earn more profit or to maximise the profit of an organisation so that they can cover there cost of capital. Corporate Governance allows shareholders and Directors to set criteria to come to an friendly agreement. This allows to set out exact guidelines to each other thus reducing conflict. (PriceWaterHouseCooper, 2004) The above figure is taken from a survey conducted by PriceWaterHouseCooper in year 2004, undertaking 134 executives. The executive were ask, what was the main reason for the failure of Corporate Governance. 37% of the executives replied because of the compliance failures and 26% replied because of the poor management and also because of the poor leadership. The conduct of senior executives was also a major risk according to 15% of directors. The figure clearly shows that Corporate Governance strongly focuses on activities such as leadership of executives. Corporate Governance in the USA Corporate Governance in the United States of America (USA) is different in some way from United Kingdom, however there are some similarities. In America the first Corporate Governance documents, was Treadway Report (Chartered Institute of Management Accountants, CIMA, 1999). It emphasis on auditing, which it stressed must be separate from directors (CIMA, 1999). There are many forces that have led to the development of corporate governance in the U.S. as it appears now. The problem of the corporate governance in U.S is that there is not a set of laws or regulation to decide how organization matters are to be addressed. There are two side-by-side laws first is Federal law and Second is state laws, and traditionally corporate governance is a matter of state, so it is determine by the sate laws. This recommendation of corporate governance was aimed at reviewing the performance and profitability of companies through an independent organization in order for shareholders to have a true pic ture of how the company is performing. The Committee of Sponsoring Organisations of the Treadway Commission (COSO) then produced a further document on Corporate Governance which was based on Internal Control (CIMA, 1999). This was designed to discuss how a company should be run and appropriate controls, which would ensure this. After the corporate scandal of Enron, the Sarbanes-Oxley statute is really a federalization of corporate law. Sovereign of written statutes and regulations, the U.S. is a common law system so a great deal of the law on corporate governance comes through judicial decisions. The United States of America introduced corporate governance legislation in 2002, the Sarbanes Oxley Act (SOX). High profile corporate collapses due to a number of circumstances including financial reporting irregularities leading to a lack of investor confidence and public trust. The Financial Services Authority (FSA) which is the regulating body of the Financial Services sector in the UK did a number of things in reaction to the Enron scandal (Rouston, 2003). Rouston explains that the FSA conducted a review of listing rules and looking further into the matter of accountancy and auditing (Rouston, K, 2003). However in the USA the response to the growing number of Corporate Scandals and most recently the Enron scandal the USA was different than the UK. The Sarbanes-Oxley Act was introduced in 2001 as a direct response to a number of corporate failures (Matyjewicz and Blackburn, 2003). The Sarbanes-Oxley Act (2002) was useful as it meant that Corporate Governance would have to be taken seriously and that there would be company on the stock exchange who did not comply with SOX (2002). Although the UK does not have legislation many companies do use corporate governance, the Combined Code, in order to attract investors (Financial Aspects of Corporate Governance, 1992). The three reasons for the development of Corporate Governance in USA:- (The Continuing Evolution of Corporate Governance in the United States- Thomas A. COLE Chairman, Executive Committee, Sidley Austin Brown Wood LLP) Capitalistic view has clearly prevailed with specific regulations imposed relating to the treatment of employees and such. The second factor in the development of U.S. corporate governance is that there are very widely held corporations. Another factor that has shaped corporate governance is the rise of the institutional investor. Paying for Good Governance One of the survey done by Mckinsey Company in 2000 all the investors are willing to pay more for a company with good board governance. Nearly 83% in latin America, 81% in US and 89% in Asia they consider that there should be proper control upon the working of the organisation. Source: Mckinsey company, Investor opinion (2000) Corporate Governance: A Mandate for Risk Management? Risk Management is described as identifying and managing a firms exposure to financial risk. Corporate Governance as describe above is a set of rules, procedure and structures by which investors, who invest in an organisation assure themselves that they are getting pre-determined return and they also ensure themselves that there investment is used and invested in efficient portfolio and the managers are not misusing there investment. It is at the top of the international development agenda as emphasised by James Wolfensohn, President of the World Bank: The governance of companies is more important for world economic growth than the government of countries. This section will focus the connection between risk management and Corporate Governance. Corporate Governance and Risk Management are strongly linked and the two are used in conjunction with one another to help companies in the running of a smooth and well-organized business. One of the main reasons for the implementation of Corporate Governance is to stop Corporate Failings and Turnbull highlights that that drive the business forward, some risks should be taken (Chartered Institute Internal Auditors for UK and Ireland). And is said to calculate risks the use of risk management is essential because even the smallest risk can create big problem for companies. CIMA (1999) explain number of factors which link Corporate Governance with Risk Management, good corporate Governance reduces risks. The purpose of the risk management is to eliminate risk. Risk Management as described by Coyle (2003/04) identifying, assessing and controlling the risks facing a business, and with incorporating risk issues into decision making processes (Coyle, B, P2). And if we compare the definition provided by the (Cadbury, 1992, Coyle, p4) The system by which companies are directed and controlled both the definitions aim to protect the organisation and their investor (equity or debt) and also ensure the smooth running if the organisation. There have been many changes in issues Corporate Governance and Risk Management from the Cadbury Report of the early 1990s to the more recent Turnbull Report of 1999. Well it is now clear to all the boards of directors there responsibility to ensure that all possible threats to an organisation have been systematically identified, carefully evaluated and effectively controlled. Corporate Scandals The Corporate Scandals were occurring on a frequent basis in the 1980s 1990s (The international Corporate Governance Review 2003). This was considered as a worrying condition for investors and companies. Short et al (1998) suggested that corporate scandals can occur for a number of reasons one of the reason given by them was creative accounting, which can explain as not doing the accounts properly and hiding the problems or risk through which the company is exposed. And the investors believe that company is performing and working in a good condition and there investment is safe. They also explained that dishonest of directors also played a vital part in corporate scandals, this can be in many ways such as hiding the fact and telling shareholder that the company is doing well. Nathanson (2002) explain corporate scandals often have elements of political blame. Nathanson explain this by taking the example of Heaths Government in 1972 as they made a drive for growth. Which mean high share prices which affected the economy which was growing at round 5%. And some companies such as Slater Walker went bankrupt (Nathanson 2002). One of the interesting question to analyse is How do (the suppliers of finance) make sure that managers do not steal the capital they supply or invest it in bad projects (Licht, 2003). To protect Investors is the overall main purpose of Corporate Governance and this statement shows the overall purpose for the Corporate Governance. The scandals not only affected the shareholders of the organisation but it also harm the staff, usually financially. So the whole organisation was effected by the Corporate Scandals. One of the article printed in Financial Times in year 2002, which explain the former employees pension which was previously worth $450, 000 is now worth $12,000, this is because of the collapse of the company, and financial time total blame corporate governance (Financial Times, 2002). This shows how the collapse of a massive company such as Enron can have on one individual employee. However we should also understand that shareholder are not only one who are affected by this disaster but it also affected such as the financial services market, a decline in confidence in the market, and the government as it is poor publicity. (Market and opinion research International, 2003) The figure 3.2 highlights that confidence in UK organizations is in-fact fairly high when comparing the above data it is clear that in-fact confidence is rather high with 47% disagreeing that an Enron could occur and 35% strongly disagreeing. But the fact is that only 4% of the directors who were interviewed believe that it was likely or highly likely. To conclude this, now the directors are confident after the effective corporate governance that there wont be another Enron Scandal occurs in the UK. Maier (2005) suggested of the failure of the corporate governance is corporate scandal. And because of these corporate scandals investor loose there confidence over the market (Maier 2005). Because of these corporate scandal government introduce the Cadbury Report (1992) to increase the confidence of the investor (Cadbury Report 1992). The USA also acted in a similar way to the Enron scandal by introducing the Sarbanes-Oxley Act (2002). It appears that corporate scandals have many bad affects but they are a key driver for Corporate Governance. Can directors be trusted to tell the truth? Agree: 17% Disagree: 65% Are directors paid too much? Agree: 75% Disagree: 11% Can firms pension promises be trusted? Agree: 34% Disagree: 43% Can accountants be trusted to check results? Agree: 37% Disagree: 39% (BBC Business, 2002) The above figure was taken from BBC business survey which was conducted in 2002 by surveying 2000 members of the UK public. The survey was conducted soon after the corporate scandals which were because of the failure of the Corporate Governance. When analysing the figure the general public of UK totally lost confidence from the companies and only 17% of the citizen respondents that they trust Directors. So we can conclude by saying that corporate governance is a prime factor or this also be explain as a key element which not only enhance investors confidence but it also promote competitiveness and ultimately the whole economy benefits. The governance of companies is more important for world economic growth than the government of countries (James Wolfensohn, President of the World Bank). Cultural, political and economic norms affect the way in which a society approaches corporate governance and its affects on board leadership, management mistake and accountability. The challenge in front of the policy maker is to reach a balance of legislative and regulatory reform, taking into consideration the best practice to promote enterprise, enhance competitiveness and stimulate investment. Conclusion There are clearly many factors which act to provide incentive for institutions not to involve themselves in Corporate Governance issues. Whilst the level of monitoring by institutions is greater than that commenly supposed, such monitoring tends to be carried out in private, and, as Black and Coffee (1994) note, for most British institutions, activism is crisis driven. Furthermore, it is unlikely that behind the scenes monitoring is satisfactory, particularly from the point of view of the public, as it enhances the belief that institutions and company management are all simply part of the same old boy network, a belief illustrated by the debate concerning the high level of directors remuneration. The increase in number of informations and guidance has increased the knowledge of the companies and has also made the corporate practices more sophisticated. If we go through Cadbury committee report there was lack of internal control however Turnbull report lifted the veil and this report emphasized on internal control as part from other controls. Other countries such as the USA are different from Great Britain, the USA introduce Corporate Governance Legislation called the Sarbanes-Oxley Act. Although the United Kingdom do not have Corporate Governance legislation as such companies feel obliged to follow guidance if wish to attract investment (ICAEW, 2005). Corporate Governance is very much important for these days for the companies who work either in public sector or private sector as it has been highlighted in previous high profile corporate scandals, such as Enron, that lacking of Corporate Governance companies are exposed to being involved in a Corporate Scandal (ICAEW, 2005). Corporate Governance is now becoming a culture of companies in Britain and it is more often used than ever before. Large corporate scandals in the USA, such as Enron, have an affected other countries which also include the UK. Corporate Governance is closely linked to Risk Management; so it is essential to go through the key component in the risk management regime. Chapter 2 Case Studies In order to see the poor performance of Corporate Governance and lack of Corporate Governance legislation it is useful to use the case study approach. It was very important for the dissertation as it highlights the real life example of the poor performance of Corporate Governance. A case study can be defined as a research study which focuses on understanding the dynamics present within a single setting (Eisenhardt 1989, p65). This technique (Case Study) was introduced in 1934 as per the Oxford English Dictionary (2006). According to Stake (1993) the purpose of using two case studies was to see how the failure of corporate governance and there affect on the companies in different ways. One of the key objectives of including these cases is to see the affect of corporate scandals and how they can happen and this aim can be assisted by the case study technique. There are a many limitations however; the company scandals are in different sectors of the economy. The approach of case study is having number of advantage and number of disadvantages as well. By using case studies, comparisons can be drawn, comparing one corporate scandal with the other company scandal (Jankowicz, 2005). It must be noted that when comparing the different corporate scandal they are often very different but the

Great Chicago Fire Essay -- American History

Great Chicago Fire I have no passion or desire to write about a thunderous destruction of a city or the death of hundreds of people. Yes, I have no connection to this topic, besides my home being 30 minutes from downtown Chicago, but that does not mean that this fire does not pertain to me or anyone who lives in a completely different state for that matter. So, just because I have never experienced a disaster of this magnitude does not mean that my lips should stay shut regarding the topic of the Great Chicago Fire. What must be done is to look at events and, for that matter, life in a certain perspective that is not always one-sided. This one-sidedness can come from focusing on a particular outcome without realizing what else can come from that desired outcome. The Great Chicago Fire occurred during October 8th and 9th of 1871. The weeks leading up to this disaster were spent with an extremely watchful eye on the city due to the lack of rain. So, one spark or one small fire could start an extremely large fire because of how much wood had been used to build the city. There were even warnings given in form of a building inspection department idea that would inform the city that the buildings were â€Å"shoddily constructed firetraps†, according to the Tribune at the time. However, the city did nothing about the proposed problem of a dangerous fire breakout and paid the price. It came to the evening of October 8th, 1871 and the table had been set. It is still unclear how the fire had started because one newspaper claimed that a cow kicked over a lantern to start a barn on fire. However, that newspaper retracted their claims when charges of slander surfaced. The fact of the matter is, it started on t... ...ou are not heading down the life path that you had wanted since you were young. You would have a chance to go ahead and change your life and your happiness simply because you got canned. Obviously, if you did not get fired you would not have had that chance to sit back and realize your life is sliding away in the wrong direction. Indeed, that is a very extreme example of how this question would apply to everyday life, but it works with those events of the simplest nature too. If one looks at disasters in this way, it is much easy for it to be rationalized. How do people who do not believe in a God and its plan for everyone deal with the fact that so many people perished from one act. There is no good reason for mass amounts of people to die, but if something greater comes from it regarding the well-being of many more people it makes it more bearable.

Trade Show Intelligence Essay -- Marketing, Competitive Intelligence

Trade show intelligence Introduction Many organizations that offer products and services in their individual markets are involved in the practice of gathering data and information about their rivals or competitors. This practice is common in trade shows and other similar exhibition events. Trade shows offer a rich source of actionable information and most organizations know this and thus; their participation therein is crucial in order to adapt to their environment and keep up with their market (Calof, 2004). The aim of this paper is to discuss trade shows by focusing on how the most actionable information can be gathered from trade shows to enable better decision making and adaptation to changing environments. Firstly, a brief description of trade shows and trade show intelligence is provided, followed by the benefits and problems of trade and lastly; recommendations on forming an appropriate information collection and analysis team are provided. What is meant by trade show intelligence? Bonoma describes trade shows as a marketing tool whereby organizations and vendors are invited to participate to showcase their products and services in an exhibition setting (Bonoma, 1983). They are events organized solely for the purpose of marketing and information sharing, where competitors and partners are in direct contact with each other. As mentioned in the last paragraph, organizations are actively collecting information on each other’s strategies and operations. This allows them to identify trends and predict changes in their environments in order to become flexible and remain in operation (Calof, 2004; Cherry & Gardner, 2002). Trade shows are important for this reason, they provide organizations with â€Å"†¦the best opportunity for coll... ...ormation from trade shows (Calof, 2004). Once the trade show is over and information has been collected, it will be time to return to the office and analyze the results. A follow up can be made on formed relationships; agents can use these relationships to collect more data in the future. Since these agents will actively be involved in CI even after the trade show; these formed relationships can be of advantage to them. Conclusion To conclude, trade show intelligence is a sub-concept of competitive intelligence that allows organizations to use actionable information to change their position in the market, maintain it or make strategic decisions. A dedicated CI team made up of CI agents that understand the full context of the information needs derived from Key intelligence topics is required to collect the data and bring it back to the organization for analysis.

Developing And Conducting A Successful Capital Campaign Essay -- Fund-

Developing And Conducting A Successful Capital Campaign A capital campaign is an effort to raise funds for the capital needs of an organization or institution. This includes acquisition of property or equipment, construction, renovation, endowments, special projects and programs. Capital campaigns are an occasional necessity, from time to time, in the life of an institution especially when it is part of an institution’s master or long-range plan. The efforts of a capital campaign are of major proportions usually taking place over several years. The reason I have undertaken the research of developing and conducting a successful capital campaign is because I have been in environments where capital campaigns were being conducted. As an undergraduate at Cal State Dominguez Hills, I recall the ground breaking of the Loker Student Union, which was in the last phase of its campaign. I also remember when the campus took on the task to raise fund for the Challenger Center; it was considered in the pre-public phase of the campaign. As a professional, I have been fortunate to be part of two capital campaigns, UCLA’s and the Greater Los Angeles Zoo Association’s. In 1993 at UCLA, I was an assistant to the Director of Development of the Neurosciences in the School of Medicine. Along with the other campus schools, I was involved in the planning and preparation that occurred before the capital campaign called the pre-public phase. It was a very educational experience that I enjoyed. In 1997/98, as a Manager of the Capital Ca mpaign at the Greater Los Angeles Zoo Association, I was involved in efforts during the capital campaign called the public phase. While my experience at the Zoo was also education, I realized that components of the ca... ...le to exceed its goal. BIBLIOGRAPHY Capital Ideas, by M. Jane Williams, Fund-Raising Institute, 2nd Edition, San Francisco, 1979 Conducting a Successful Capital Campaign, by Kent E. Dow, Jersey Bass Publisher, San Francisco, 1991 Capital Giving: Transition from 80’s to 90’s, by J.P. Butler III, CASE, Bethesda, MD, 1986 Prerequisites for Probable Campaign Success, by John Grezenbach, "Corporate Report," Chicago, IL, 1986 Key Elements to a Successful Capital Campaign, by Anita Morin, Capital District Business Review, 1996 Capital Quest, Inc., Traditional Phases of Capital Campaign Michael Marek, Organizing a Capital Campaign Rocky Mountain Institute Newsletter Georgia Tech Capital Campaign Update University of Miami School of Medicine Capital Campaign Update University of Findlay Capital Campaign Office Group 121 Consulting Firm

Integrated design: Electric lawn mower Essay

INTRODUCTION Quality must be part of the design of a product not something that has to be based from an inspection done after the design. Quality means satisfying the requirements and needs of the customer. The focus of quality is to identify the customer requirements and to translate this into design constraints. QFD also takes into account what are the limits of hardware design based on existing or available resource or technology. All these requirements must be satisfied in order to produce a quality design. STATEMENT OF THE PROBLEM The purpose of this document is to apply the Quality Function Deployment (QFD) into the planning stage of a lawn mower design. This document seeks to answer the extension lead requirements of a lawn mower. The end result is the design concept of how to implement the lawn mower extension lead based on customer requirements and hardware constraints. DESIGN Identification of Requirements Using the data provided, the following customer and hardware requirements are generated. The design will then focus on satisfying these requirements. The customer requirements are the following: †¢ Electric Lawn Mower – Powered electrical energy instead of combustible fuel such as gasoline. †¢ Variable Length Flexible Lead – Since the size of the household that will use the electric lawn mower is variable, there is no definite fixed length of the flexible lead. The hardware constraints: †¢ The use of extension lead would render the to overcome the lack of length fixed mower lead the suppressor and earth breaker will not work efficiently, causing the disruption of power to the mower. Design Analysis The initial main requirement of the design is to make an electric lawn mower. One of the main obstacles of the design is the variable length flexible lead. The hardware requirement of inefficiency in the suppressor and earth breaker when using extension lead makes the extension lead not an option anymore. This leads into two possible solutions. 1. Use of the longest possible customer length requirement, to satisfy all needs. 2. Use of re-chargeable battery to remove the constraints of the need for variable length flexible lead to power the electric lawn mower. The length can be fixed just enough for charging the batteries. Analyzing the first requirement, to satisfy all the length requirements of flexible lead using the longest possible lead requirement seems to be the most cost effective solution. The problem is, this would also mean that the lawn mower will have to carry the weight added by the lengthy flexible lead. And to satisfy all requirements, this means that the flexible lead had to be considerable long. Considering the current requirements of a lawn mower, the flexible lead had to be relatively larger than average home extension wires. Just imagine how much weight this would produce. Therefore as a designer, this is not a good option. Analyzing the second requirement, which is now the remaining solution, we should be able to contrast the negative effects with the negative effects of the first solution. This therefore boils down to the weight issue. The lawn mower requires a considerable amount of power to run, therefore the battery has to be able to sustain sufficient operating time. The most viable battery would still be the lead-acid, otherwise it would be very effective, one standard automotive battery would surely not be enough. Looking at the power requirements, this should be calculated in detail based on the power requirements of the lawn mower. Since the power requirement of the lawn mower is not yet available at this level of conceptual design, we can make some estimate. Assuming the lawn mower consumes 3000 Watts of power, more than double for the average vacuum cleaner. Two hours of lawn mower operation is probably sufficient for as long as it can be recharge. At 12 V Lead-Acid battery, and 2 two-hours of operation would required the following ampere-hour requirements. Japanese standard car batteries could deliver up to 150*Ah, thus we can calculate the number of batteries So we need roughly four batteries. The weight of four batteries is still acceptable therefore this is a better solution compared to having the longest possible flexible lead. CONCLUSION The final solution presented based on QFD analysis of customer requirements yielded with a battery packed electric lawn mower. The battery is able to solve the flex lead requirement by just fixing the length to a relatively short distance enough for re-charging.

The Nature and Forms of Commercial Organization

CHAPTER 5 The Nature and forms of Commercial Organizations Commercial organizations may be classified into three (3) general classifications: 1. Private individual ownership 2. Public or government ownership 3. Mixed or both government and private ownership 1. Private Individuals Ownership Any form of business ownership may be organized and would have certain advantages and disadvantages which the business organizer must have to evaluate. According to Martinez, Abasolo, and Carlos, the following are the questions to be considered in deciding the form of business: 1.Is it simple or difficult to form? 2. Is capital easy to rise? 3. What are the risks and the liabilities of the owners? 4. Who holds the authority and responsibility for the management and administration of the business? 5. What stability does the form offer? 6. Is it flexible? 7. What the legal status of this form is as applied to the particular business in mind? 8. What is the extent of government control? 9. What is the tax advantage of this form of organization? 10. Is the business environment favorable?Private commercial organizations or business enterprises may take the following forms of ownership: * Individual or Sole Proprietorship It is a business owned by one person. This form of ownership is small, requires but little amount of capital, and is readily established under the control of one person. It refers to an individual who owns, manages, assumes all the risks, and derives all the products or profits from a business. Advantages of Sole Proprietorship * Easiest to establish. * Easiest to terminate. * Small amount of capital is required in starting a business. Presence of personal element in managing the business. * Freedom and immediate action and control in operating the business. * Ownership of all profits. * Tax savings. * Minimum legal requirements. * High credit standing. * Business secrecy. Disadvantages of Sole Proprietorship * Limited amount of capital. * Lack of continuity. * Li mited judgment and wisdom. * Unlimited liability. * Difficulty of management. * Limitation in business size. * Limited opportunities of employees for promotion. * Difficulties in managing the day-to-day business operations. Creating a Sole ProprietorshipNo special legal procedures, permits, or licenses are required. A sole proprietorship is not limited in size by either the amount of inputs which can be used or the amount of products produced. The business can be any number of employees, additional management may be hired, and property may even be co-owned with others. Income Taxes The owner of this business pays income taxes on any business profit at the tax rates in effect for individual or joint returns. Business profits and capital gains are added to other taxable income earned to determine the individual total taxable income. Partnership A partnership is a form of business in which two or more people operate for the common goal of making profit. Each partner has total and unlim ited person liability of the debts incurred by the partnership. It is a voluntary association of two (2) or more persons to carry on, as co-owners of a business for profit. Basic Characteristics of Partnership 1. Profit and Loss: The sharing of the business profit and loss. 2. Property y or Assets: Shared control of property. 3. Management: Shared management of the business. General legal agreement of partners: 1.Each person involved participates in management decisions. 2. Assets are owned jointly. 3. Sharing of profits and loss. 4. The parties (business) operate under one name. 5. The parties have joint bank account for doing business transactions. 6. The parties keep a single set of business records. Types of Partnership 1. Ordinary or General Partnership 2. Limited Partnership Creating a Partnership Partnership can be created oral or written agreement. Oral agreement tends to have more problems than written partnership agreements. The written agreement should cover at least the following points: . Management. Who is responsible for which management decisions and how will they be made? 2. Property ownership and Contribution. It is the list the property each partner will contribute to the partnership and describe how it will be owned. Property may be owned by a partnership, or the partners may retain ownership of their individual property and rent it to the partnership. When the partnership itself owns property, any partner may sell or dispose of any asset without the consent and permission of the other partners. 3. Share of Profits and Losses.The method for calculating profits and losses and the share going to each partner should be carefully describe, particularly if there is an unequal division. Profits are generally divided in proportion to the value of the assets, labor and management contributed to the business. 4. Records. Records are important for the division of profits and for maintaining an inventory of assets and their ownership. 5. Taxation. The agreement should contain a detailed account of the tax basis of property owned and controlled by the partnership and copies of the partnership information tax returns. 6. Termination.The agreement should contain the date the partnership will be terminated if one is known or can determined. A partnership can be terminated in a number of ways: * It may specify a termination date * If no duration is fixed by the agreement any partner may terminate the partnership at will. * If not, a partnership will terminate upon the incapacitation or death of a partner, bankruptcy, or by mutual agreement between the partners. * Termination upon the death of a partner can be prevented by placing provisions in the written agreement that allow the deceased partner’s share to pass to the estate and hence to the legal heirs. . Dissolution. The termination of the partnership on either a voluntary or involuntary basis requires a division of partnership assets. The method for making this division sh ould be described to prevent disagreements and unfair division. Terminating a Partnership 1. Agreement. Between the partners or by operation of law. Usually termination under agreement comes to an end when the duration term or business is finished. 2. At Will. If no duration is fixe by the agreement, any partner may terminate the partnership at will. 3. Operation of Law.Dissolution by operation of law occurs in the event of death, bankruptcy, or incapacity of any partner. Advantages of Partnership * It could be as easily established as the sole proprietorship. * It has definite legal status. * There are more persons to manage the business and to solve its problems. * There is larger amount of capital. * Retention of valuable employees is ensured. * The combine abilities, skills, and resources of partners are great source of strength. Disadvantages of Partnership * Unlimited liability of the partners; * Managerial difficulties; Inevitable disagreement among partners may endanger the business firm; * Limitation in size; * Frozen investment; * Lack of continuity; and, * Easy dissolution. Advantages of Limited Partnership * There is a single direction of management; hence there is unity and immediate action taken upon. * The limited liability of limited partners, shall serve as good enticement of inventors resulting in larger amount of capital to expand business operations. Disadvantages of Limited Partnership * The unlimited powers entrusted to general partners maybe abused.The limited partners cannot interfere in the administration of the business firm even if there is mismanagement. Only when fraud exists or when there are clear violations of the firm agreement, can the limited partners seek for remedial or legal action. * There is a great possibility of connivance among the general partners to commit fraud against the creditors and the limited partners. * Corporations A corporation is an artificial being created by operation of law, having the rights of succes sion and the powers, attributes, and properties expressly, authorized by law or incident to its existence.Different Classification of Corporations 1. Public or Private * Public Corporations are those formed or organized for the government of a portion of the state. The objective of a public corporation is the general good or welfare. * Private Corporations are those formed for some private purpose, benefit, aim or objective, or profit. 2. Division of Private Corporations: * Stock Corporations are those who capital stocks are divided into shares and a shareholder is issued a certificate of stock which would entitle him to certain portion of the projects or dividends. Non-stock Corporations are those that do not issue shares of stock to members such as religious, civil, or charitable organizations. Other kinds of corporations may be grouped into: 1. Quasi Corporations. There are business firm that are not absolutely corporations but are considered as if they are corporations. Public b oards created by laws may fall under this classification. 2. Quasi-public Corporations. This one is engaged in rendering basic services of such public importance as to entitle it to certain privilege like eminent domain or use of public property. 3.Government-owned or controlled Corporations. Are those established by government or corporations of whom the government is the majority stockholder. 4. Dejure and de facto Corporations. * De facto corporation is used to designate associations exercising corporate powers under color of a more or less legal organization. * Dejure Corporation is one created in strict or substantial conformity with the statutory requirements for incorporation; and whose right to exist as a corporation cannot be successfully attack even in a direct proceeding for that purpose by state. . Domestic and Foreign Corporations. * Domestic Corporation is one incorporated under Philippine laws. * Foreign Corporation is one established, organized, or existing under any laws other than those in the Philippine territory. 6. Corporation aggregate and corporation sole. * Corporation aggregate is one composed of more than one member or corporator. * Corporation sole consists of one member or corporator and his successors. 7. Eleemosynary and civil corporations. * Eleemosynary Corporation is one established for charitable purposes. Civil Corporation is a corporation that is not ecclesiastical and eleemosynary whether public or private. 8. Ecclesiastical and lay corporations * Ecclesiastical Corporation is a religious organization. * Lay Corporation is established for a purpose other than religion. Compositions of a Corporation 1. Corporators. These are the stockholders or members and/or both, of the corporation. 2. Incorporators. These are the stockholders or members, and/or both, stated in the articles of incorporation as found in members of the corporation. . Members. These are the corporators of a corporation which has no capital stock. 4. Stockhold ers or Shareholders. These are the owners of shares of a corporation which have a capital stock and whose names appear in the books of corporation as the holders of a share or shares of stock of the corporation. Classes of Capital Stock 1. The Common Stock. According to Philippine laws governing the establishment of the corporation, the right of ownership and active control and participation is vested in the owners of the common stock.The common stock carries with it the power and right of voting, through which the holders have great residual ownership or power over the corporation. Common stock is the ordinary stocks representing the basic ownership. The ownership interest is divided into shares which may or may not have a par value. The par value is the amount printed on the stock certificate. 2. The Preffered Stock. The owners of preferred stock are granted special protection or advantages over the common stockholders. It carries preference as to priority in the granting of divid ends over the common stock or as to capital in case of dissolution.Upon dissolution of the corporation, for instance, the preferred stock has priority in the distribution of the assets. There are several classifications of preferred stock: * Preffered as to dividends. * Preffered as to assets. * Preffered as to both dividends and assets. * Cumulative preffered. * Callable. * Convertible. Advantages of Corporation * Limited liability of stockholders. * Large amount of capital. * Flexible ownership. * Length of life. * Efficiency of management. * Ease of expansion. * Legal entity. Disadvantages of Corporation * Taxation. Organizational expense. * Government restrictions and reports. * Lack of personal interest. * Lack of secrecy. * Charter restrictions. The Corporate Combination and Merger The Merger. Merger means the union affected by the absorbing of one or more existing corporations by another which survives and continues the combine firm. In other words, merger takes place when th e control of several corporations is vested in a single corporation, in which case stocks of the controlling corporation may be issued in place of the stocks of the other corporations.There is no new business firm. The absorbing corporation remains the same single although larger corporation. In consolidation, the consolidating corporations are dissolved, their properties and businesses transferred to a single company. Merger and consolidations may be adopted as a strategy by several companies in a given industries when they strongly agree that it is more economical and working together rather than competing with one another. * Cooperatives The word cooperative is derived from the French word â€Å"cooperari†. The word â€Å"co† means â€Å"with†.Combined with â€Å"operari† (to work, from oppose, operas, work ), it delineates the concept of â€Å"working together†. The social concept shows a process of working together and thinking together to ach ieve and enjoy the best of life. Cooperative is the dynamic form of business enterprise that embodies the philosophy of corporation. It signifies the voluntary assent of people to form themselves into a group for the promotion of their common needs by mutual action, democratic control and sharing of economic benefits of the basic of patronage by members.Republic Act No. 6938, An Act to Ordain A Cooperative Code of the Philippines, defines cooperatives as â€Å"a duly registered association of persons, with a common bond of interest, who have voluntarily joined together to achieve a lawful common social or economical end, making equitable contributions to the capital required and accepting a fair share of the risks and benefits of the undertaking in accordance with universally accepted cooperative principles. † Principles of Cooperatives 1. Open and Voluntary Membership.Membership in a cooperative shall be voluntary and available to all individuals regardless of their social, political, racial, or religious background or beliefs. 2. Democratic Control. Cooperatives are democratic organizations. Their affairs shall be administered by the persons elected or appointed in a manner agreed upon by the members. Members of primary cooperatives shall have equal voting rights on a one-member-one-vote principle: Provided however, that in the case of secondary and tertiary cooperatives, the provisions of Article 37 shall apply (Voting System): * Each member of a primary cooperative shall have only one vote.A secondary or tertiary cooperative shall have voting rights as delegate of members-cooperatives, but such cooperatives shall have only five votes. The votes cast by the delegates shall deem as votes cast by the members thereof. * No voting agreement or other device to evade the one-member-one-vote provisions, except as provided under subsection hereof, shall be valid. * No member of a primary cooperative shall be permitted to vote by proxy unless provided for spe cifically in the by-laws of the cooperative. However, the by-laws of a cooperative other than a primary may provide for voting by proxy.Voting by proxy means allowing a delegate of a cooperative to represent or vote in behalf of another delegate of the same cooperative. 3. Limited Interest on Capital. Share capital shall receive a strictly limited rate of interest. 4. Division of Net Surplus. Net surplus arising out of the operations of a cooperative belongs to its members and shall be equitably distributed for cooperative development, common services, indivisible reserve fund, and for limited interest on capital and/or patronage refund in the manner provided in this Code and in the articles of cooperation and by-laws. . Cooperative Education. All cooperatives shall make provision for the education of their members, officers, and employees and of the general public based on the principles of cooperation. 6. Cooperation among Cooperatives. All cooperatives, in order to best serve the interest of their members and communities, shall actively cooperate with other cooperatives at the local, national and international levels. Types and Categories of Cooperatives (R. A. No. 6938) 1. Types of Cooperatives. Cooperatives may fall under any of the following types: . Credit Cooperative – is one which promotes thrift among its members and create funds in order to grant loans for productive and provident purposes. b. Consumers Cooperative – is one whose primary purposes are to procure and distribute commodities on members and non-members. c. Producers Cooperative – is one that undertakes joint production whether agricultural, or industrial. d. Marketing Cooperative – is one which engages in the supply of the production inputs to members and markets their products. e.Service Cooperative – is one which engages in medical and dental care, hospitalization, transportation, insurance, housing, labor, electric light and power, communication, and other services. f. Multi-Purpose Cooperative – is one which combines two or more of the business activities of these different types of cooperatives. 2. Categories of Cooperatives. Cooperatives shall be categorized according to membership and territorial consideration as follows: 1) In terms of membership, cooperative shall be categorized into: a.Primary: The members of which are natural persons. b. Secondary: The members of which are primary. c. Tertiary: The members of which are secondaries upward to one or more apex organizations. Those cooperatives, the members of which are cooperatives shall be known as federations or unions as the case may be. 2) In terms of territory, cooperatives shall be categorized according to areas of operations which may or may not coincident with the political subdivisions of the country.