Ignition Company Analysis
Ignition is a former family company that now has become a multinational industry. The corporate governance structure of Ignition has a one-tier board structure and the board consists of twelve members, which divided to four executive members and eight independent non-executive members. Two out of four executive members are also the part of the family company founder, both hold a significant roles which are the CEO and CFO of Ignition’s parent company. The shares of the company, can be assumed divided into two main part. First, the majority shares are hold by the family member of Ignition’s founders, and this shares are followed by special voting rights. Second, the minority shares disperses into a large number of shareholders. In the one-tier board, moreover in for public listed company, the existence of board committees are required , this is a common action for unitary board since the subcommittee will enable the independent non-executive directors to oversights roles in the board and
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Some of the risks could occur from the company’s organization activities and/or from within the enterprise (like fire, accident, etc.). Other potential risk that mostly could cause bigger effect such like in Enron or Parmalat is related to a failed strategic planning. The common risk that arise from a family company is that the board decision will most likely dominated by family member, management cannot do much to really exercise its duty to manage the company. Moreover, if the management board is in imbalance position, where there are less independent directors inside the board (this happen in Parmalat company structure). Ignition parent company, even if the board consists of twelve members and eight out of it are independent non-executive directors, the CEO and CFO position are occupied by family member and they dominated the
Some of the risks could occur from the company’s organization activities and/or from within the enterprise (like fire, accident, etc.). Other potential risk that mostly could cause bigger effect such like in Enron or Parmalat is related to a failed strategic planning. The common risk that arise from a family company is that the board decision will most likely dominated by family member, management cannot do much to really exercise its duty to manage the company. Moreover, if the management board is in imbalance position, where there are less independent directors inside the board (this happen in Parmalat company structure). Ignition parent company, even if the board consists of twelve members and eight out of it are independent non-executive directors, the CEO and CFO position are occupied by family member and they dominated the