Acca aaa s21 Notes

Board Leadership and Company Purpose
๏
Every company should be headed by an effective board which is collectively responsible for the 
long-term
success of the company.
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All directors must act with integrity, lead by example and promote the desired culture.
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The board should: 
‣
establish the company’s purpose, values and strategy 
‣
ensure the company has the necessary resources to meet its objectives 
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establish effective controls to assess and manage risk
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ensure effective engagement with, and encourage participation from, stakeholders
‣
ensure that workforce policies and practices are consistent with the company’s values and 
support its long-term success. 
September 2021 to June 2022 exams
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Division of Responsibilities
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There should be a clear division… between the running of the board and the executive 
responsibility for the running of the company’s business. No one individual should dominate 
decision making. This means that the roles of CEO and chair should not be performed by one 
person as that concentrates too much power in that person.
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The chair is responsible for leadership of the board and should be 
independent
on 
appointment (e.g. not an employee within the last 5 years).
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At least 
half
the board should be non-executive directors (NEDs) who are considered 
independent (e.g. no close family ties with executive directors, no significant shareholdings, etc).
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NEDs should provide constructive challenge and strategic guidance and hold management to 
account.