PES SCIENCE, ARTS & COMMERCE

COLLEGE MANDYA
Seminar Presentation
Subject : Corporate Governance.
Topic : Cadbury Committee

Presented to , Presented by ,
MOHAN KUMAR S M SIR. MEGHANA J
Assistance professor. 1st M.Com.
 INTRODUCTION.

The Cadbury report was once referred

to as the report of the committee on
the Financial aspects of Corporate
Governance.
 MEANING.
The Cadbury report titled financial
aspect of corporate governance is a
report issued by “the committee on the
financial aspect of corporate
governance” chaired by Adrian Cadbury
that sets out recommendations on the
arrangement of company board &
accounting system to mitigate
corporate governance risk and failures
 DEFINITION.

“The system by which companies

are directed and controlled by a
Cadbury Committee”.
 Cadbury committee Reports.
 The Cadbury committee was set up in
may 1991 by the financial reporting
council of the London Stock Exchange.
 The committee published its report in
December 1992.
 Adrian Cadbury the chairman of
Cadbury Committee.
 The Cadbury code of best practices
had 19 recommendations.
The code of best practices has been divided into
4sections. They are,

 Role of Non-Executive Director duties of board

and its compositions.
 Role of Non-Executive Directors.
 Role of Executive Directors.
 Relating to the Board of Directors.
 The Board should meet regularly,
retain full.
 Unfettered powers of decision making.
 Formal schedule of matters.
 Take Independent professional advice.
 Should have access to the advice and
services of the company secretary.
 Relating to the Non-Executive
Directors.
 Should bring an independent
judgment.
 The majority should be
independent of the management
 should be appointed for specified.
 Selected through a formal
process.
Relating to the Executive Directors.
o Should not exceed three year.
o should be full and clear disclosure
of their total Employments.
o Pay should be subject to the
recommendation.
 Reporting and Controls.
 Company’s position.
 Should ensure that an objective and
professional relationship.
 Should establish an audit committee of
at least three Non-Executives Director.
 Should explain their responsibility.
 Internal control.
 Report that the business is a going
concern with supporting assumptions.
 CONCLUSION.
The Cadbury Committee compliance with
the code of best practice was not
enforced and it was not mandatory. How
ever , many firms controlled because
they did not want to fall victim to the
destructive consequences resulting
through the disregard of corporate
governance