Middle Earth Bank Case Study

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Reforms to be implemented on the Middle Earth Bank: A study of preventative measures for collapsing of banks Introduction A bank is financial institution approved by governments to make investments, give out loans, help to reduce imperfections in international markets as an intermediary in financial transaction and provide other financial services to its customers (Emily,Hill,Hussain,&Nixon, 2014). These financial institutions take various forms but these various forms broadly fall under or can be categorized into two being commercial banks: known to be banks within a country and International banks: known to be the World banks. World banks were developed to help other countries to borrow from this bank temporarily until they grow enough…show more content…
• Corporate governance: The board of the Middle Earth Bank was not governed properly, it is clear that some board members were not aware of the decision taken to appoint Bilbo more than two positions. Corporate governance being referred to a system by which a company is directed and controlled (Al-Tamimi, 2012). The objective of corporate governance in business is to ensure a company is able to make better decisions. Through better decision making it enables businesses to be successful, the key is to ensure there is flow of information i.e. making sure the right information gets to the right people at the right time. Corporate governance is subdivide into elements known to be (board of directors, disclosure and transparency, executive compensation, governance structure, compliance and polices, relationship with shareholders and stakeholders). Boards and executive officers are held accountable for the role in ensuring that business acts in a responsible and accountable…show more content…
Through proper corporate governance in an organization, business performance is evaluated in terms of triple bottom line which requires businesses to compel to acting responsibly towards the environment. Looking at one of the elements of corporate governance which is board of directors, we can summarize corporate governance by listing some of key responsibilities that would ascertain the success of a company. It is the role of the board of directors to ensure they report fully on corporate or business activities and more especially on the triple bottom line namely: the Profit bottom line, the social bottom line and the environmental bottom line. This ensures that shareholders and stakeholders are well informed of the business state on the stock exchange. The board of directors has to ensure that the organization acts with integrity and governs the ethical standards, ensuring that these standards are met and

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