Report On Barclays PLC

CG complaints in Barclays PLC
REPORT ON BARCLAYS PLC'S 2018 UK CODE OF

CORPORATE GOVERNANCE COMPLAINTS
Student Name: Ruth Maneesha Evanjalin Gomis

Student ID: 4659
Date: 15th March 2023

Module: Corporate Governance
Lecture Name: Mr. Dimuthu Heenpella
Code: ACC3017
Word Count: 3121
pg. 1
Acknowledgement
In order to complete this job, I must appreciate and extend my sincere gratitude to my lecturer,
Mr. Heenpella. I was able to complete all of the writing phases for my report because to his
direction and suggestions. Additionally, I want to express my gratitude to my classmates for
making my defense a fun experience and for their insightful comments and ideas.
Additionally, I want to express my gratitude to my husband and my entire family for their
unwavering support and patience as I conducted my research and wrote my report. Your
supplication for me has kept me going so far.
Finally, I want to express my gratitude to God for guiding me through all of the challenges.
Every day, I have felt your guiding. For my future, I'll continue to put my trust in you.
pg. 2
Content
Acknowledgement.......................................................................................................................2
Content.........................................................................................................................................3
Abstract........................................................................................................................................4
1.0 Introduction............................................................................................................................5
1.1 Overview of Company.................................................................................................................5
2.0 Barclays relationships with its stakeholder’s (673)...........................................................6
3.0 Barclays (PLC) approach to ensuring effective leadership (451).....................................9
4.0 Barclays (PLC) compliance with the requirements for board independence (392)......12
5.0 Barclays (PLC) adherence to the composition, succession, and evaluation principles
(709)............................................................................................................................................14
6.0 Barclays (PLC) approach to audit, risk, and internal control by examining its
compliance to external auditor rotations. (414)......................................................................17
7.0 The structure of remuneration for the CEO for the past two years (743).......................19
8.0 Conclusion (532)..................................................................................................................22
9.0 References...........................................................................................................................23
pg. 3
Abstract
Nowadays, corporate governance sits at a nuanced nexus of the law, morality, and economic
effectiveness. Every time a corporate entity has a life of its own and the ownership of the
business is split from the management, a governance issue occurs. Corporate governance is
required to develop an open, transparent, and mindful business culture. It enables a business to
optimize its long-term value, which is evident in the way the business performs.
An effort is made to research various corporate governance approaches used by Barclays PLC
in this aspect. This will cover factors including the board's constitution, structure, several
committees, independent directors' functions, conflicts of interest, and information disclosure.
The goal is to ascertain whether corporate governance and firm performance are related. The
study will examine whether having higher and better corporate governance scores results in the
companies doing better. According to the study, corporate governance procedures have little
bearing on firms' stock prices or their financial performance.
pg. 4
1.0 Introduction
1.1 Overview of Company
Personal banking, corporate banking, wealth management, and investment management are
the four main divisions of Barclays Public Limited Company (PLC), a global investment bank
and provider of financial services. Barclays UK and Barclays International are the two divisions
that make up Barclays. The UK retail banking operations, UK consumer credit card business,
UK wealth management business, and corporate banking for smaller enterprises are all part of
the Barclays UK division. The corporate banking business, the investment bank, the U.S. and
worldwide card business, and global wealth management are all part of the Barclays
International division.
London, United Kingdom, is where the headquarters are. John Freame and Thomas Gould, who
conducted business in Lombard Street as a goldsmith banking firm, created Barclays PLC on
November 17, 1690. Barclays (PLC) is the fifth-largest bank in Europe by total assets, employs
more than 80,000 people, and conducts business in over 40 countries (Slater, 2008). There are
more than 4750 branches overall. Of the total number of branches, 1600 are located in the
United Kingdom (Slater, 2008).
James Barclay, John's son-in-law, joined the company in 1736, giving it its current name. Since
then, Barclays has been a pioneer in innovation, supporting the first industrial steam railway in
the world, appointing the first female branch manager in the UK, and providing the first ATM.
Barclays also installed the first cash dispenser in history. Numerous businesses have been
acquired by Barclays, including the Woolwich in 2000, the London, Provincial and South
Western Bank in 1918, the British Linen Bank in 1919, the Mercantile Credit in 1975, and the
North American operations of Lehman Brothers in 2008.
Barclays PLC's board of directors uses a two-tier board structure, with an executive board and a
separate supervisory board made up entirely of outside non-executive directors and executive
directors, respectively (Tricker, 2015). The Barclays PLC is also utilizing the dual board model,
where one member will serve in various committees in a variety of capacities. Due to its status
as a publicly traded corporation on the London Stock Exchange and its application of the
complete requirements of the 2018 UK Corporate Governance Code, Barclays PLC complies
with the UK Corporate Governance Code.
pg. 5
2.0 Barclays relationships with its stakeholder’s (673)

Company purpose Approach and Justification Implications
and Did the company comply with the Drawing on academic theory
communication code? Explain and justify (using and empirical evidence,
with shareholders evidence from the company report critically evaluate whether your
and the code) company’s approach is
effective.
Communication Yes, Barclays PLC comply with the Stakeholder theory understand
with stakeholders code. stakeholder’s communication.
(Culture, purpose
and strategy Barclays has demonstrated through
below statistics that it upholds its (Morsing & Schultz, 2006)
obligations to shareholders and states how stakeholders be
stakeholders by ensuring efficient involved in frequent, systematic
engagement with and encouraging and pro-active dialogue can
participation. help to build mutually beneficial
relationships. Equally (Krasny &
• The Barclays board ensures Tidball, 2010) believe that
effective engagement, encourages consistent communication with
participation with, stakeholders, diverse stakeholder groups can
shareholders with combination of also reveal unknown
leader-led engagement, digital, print environmental trends and
communication, blogs, Visual logs, innovative approaches.
podcasts to keep everyone informed Dialogue with stakeholders is
strategy, performance, and progress. preferred and it is also a key
word that occurs frequently in
• Barclays makes sure (ESG) corporate rhetoric on CSR
Environment Social Governance (Ihlen, et al., 2011).
report communicates with
stakeholders sincerely and  In order to archive this
accurately. effective dialogue Barclays
engage with stakeholders
•, purpose-driven culture established through running regular
by company's vision, mission, and surveys, analysing
customer complaints, and
goals
drawing on data from
millions of individual
•Its working to improve culture, transactions and personal
providing training on risk customer interactions.
assessments, creating work This is more effective
environment, employees feel free to since this allows Barclays
voice concerns. to understand
stakeholder’s viewpoints
The Board completely endorses against different
Barclays Way, company's purpose, perspectives. Through this
Barclays makes easier to
values, culture, mind-set promote
manage communications
stakeholder engagement. with each stakeholder and
company can monitor
It is evident that Barclays PLC engagement with
communicate above mention stakeholders.
endorses through a normative
pg. 6
approach of stakeholder theory in the The effects of transparency

2021 annual report. have multiple dimensions
ranging from market efficiency
to corporate governance
(Nelson, 2001) and the lack of
transparency appears as an
agency cost and as a risk
premium resulting in a lower
valuation of the company
(Oxelheim, 2008).
 As a result Barclays
believe that it is important
to be transparent in the
disclosure of tax affairs
both to tax authorities and
stakeholders more broadly
through emails. Further
Barclays engage with
stakeholders, including
ratings agencies, investors
and expert bodies, to
improve transparency and
enhance understanding of
different assessment
frameworks and ESG
scoring models used by
the various agencies. By
doing so other
stakeholders will be
encourage to
communicate more
openly. Email is one of the
most popular tools to use
for stakeholder
communication.
It has benefits such as immediate

delivery of information, proof of
sending, it makes it easier to
manage communications with
each stakeholder and you can also
monitor engagement and open
rates.
Communication Yes Company comply with codes Shareholders hire managers as

with representatives to company for
shareholders- Barclays generate value to advantage of principals,
generate value, Shareholders by according to the shareholder
contribute to wider theory, hence the main goal of
society.  Delivering a management is maximize
PBT of £8.4bn shareholders' value (Vargas-
ROTE of 13.4% Hernandez and Gonzalez,
2018; Murphy and Smolarski,
pg. 7
EPS of 37.5p 2020).

resulting in meaningful increase,
capital distributions to shareholders Barclays maintain an effective
communication with
Barclays Committee met 11 times stakeholders by commencing
every year May 11th Barclays conduct Annual general meeting. As a
Annual General Meeting. result bring transparency
between the shareholders and
The board monitor activates of the directors, as well as an ability to
company by reviewing multiple hold managers accountable for
workforce mechanisms, listening to their actions.
colleagues, monitor culture and
taking colleague feedback when Share view, Barclays online
making key decisions. shareholder platform help
shareholders to manage their
Barclays Capture opportunities as shareholding receive the latest
transition to a low-carbon economy updates additionally can vote in
by using our financial and capital advance of general meetings.
markets expertise to support the This will increase accuracy and
scale-up of low-carbon technologies, efficiency of the company.
infrastructure and capacity.
Sustainable business is one
. that is economically viable,
socially responsible, and
environmentally friendly (Beal
et al., 2017) (Daood &
Menghwar, 2017) (Bocken et
al., 2014). Barclays is working
to achieve net zero operations
and supply chain emissions in
order to achieve sustainability.
pg. 8
3.0 Barclays (PLC) approach to ensuring effective leadership

(451)
Board Characteristics Approach and Justification Implications
Did the company comply with Drawing on academic theory and
the code? Explain (using evidence critically evaluate
evidence from the company whether the separation of CEO-
report and the code) and chair is important to firm
justify (using academic performance.
theory)
Separated Roles of Yes organizational structure of every
CEO/Chair corporation is important
Yes/No According to the Governance
report of Barclays' annual Chairman and CEO is given more
report, Group Chairman, freedom and authority to fulfil their
CEO, separately oversee respective responsibilities (Foster,
company, obligations, 2019)
responsibilities in the section
of the Director's Report. CEO and board chair own
legislation, norms (UK Corporate
chairman - Nigel Higgins Governance Code, 2020).
CEO -Venkatakrishnan
For instance, rather of continuing
Barclays PLC has fulfilled to decline during the 2008
code's requirement distinct recession, the percentage of S&P
separation of duties between companies having combined
executive leadership of the positions briefly plateaued at
company's business and roughly 60%. (Foster, 2019)
board's leadership.
The academic theory of board
structure separates of the CEO
and chair roles.
The Board Structure is comprised

of the following:
1. Unitary (passive)
2.Dual(Monitoring)
Unitary board consists of a single

BOD, managing and overseeing
operations responsible for both
The CEO and board chairman are
also board members.
1. Dual
A two-tier board structure consists
supervisory board
Independent non-executive
directors oversee the executive
pg. 9
directors' duties and other

business-related activities.
Executive directors often make up

the management board,
The CEO oversees the
management board, while the
Chairman leads the supervisory
board.
Because the chairman is solely

responsible for overseeing the
board, there will be a more
suitable distribution of duties
between the CEO and chair,
which will allow the CEO to focus
more on management.
Barclays PLC's board of directors

uses a two-tier board structure,
with an executive board and a
separate supervisory board made
up entirely of outside non-
executive directors and executive
directors, respectively (Tricker,
2015). The Barclays PLC is also
utilizing the dual board model,
where one member will serve in
various committees in a variety of
capacities.
Company has been effective with

this two- tier board structure
because it balances, delegates
such as management board
(strategy and service) supervisory
board (control )
Barclays Board was appointed by

board members (through a
nomination committee) this
ensures board members represent
the best interests of company and
its staff.
Barclays CEO and the chairman
are separate individuals it
mitigates the conflict of interest
since it avoids the voting rights of
a CEO on his compensation.
Additionally if Chairman and CEO
are both taken over by the same
pg. 10
individual, he or she shall

supervise himself, leading to the
concentration of power and not
ensuring the transparency in
management and administration
of the Company.
Benefits of Dual Board Structure

 All members are non-
executives
 Balancing the power of
CEO and board Chairman
 Higher objectivity and
independence, particularly
in the process of
management evaluation,
compensation policy
Therefore the separation of CEO-

chair has avoid the conflict of
interest and balance the power
between them.
pg. 11
4.0 Barclays (PLC) compliance with the requirements for

board independence (392)
Board Characteristics Approach and Justification Implications
Did the company comply with Using academic theory and empirical
the code? Explain (using evidence critically appraise the
evidence from the company importance of board independence
report and the code) and justify on board performance.
(using academic theory).
Independence Yes Berghe and Baelden (2005)

Proportion of  The Barclays Board have examined independence as an
independent board appointed Brian Gilvary important factor in ensuring board
members as a senior independent effectiveness through the monitoring
director in order to and strategic roles of the directors.
 comply with the code
which states board Nowak and McCabe (2008) have
should appoint one of the studied Independent directors would
independent non- provide a variety of independent
executive directors to be thinking, and majority of them could
the senior independent reduce the dangers of ‘group think’
director
Appointing a SID have benefited the
 Barclays consist of Barclays, for example SID serve as a
following combination of trusted intermediary for and between
Ex, NonEx Directors of other Directors, so this will easily
Barclays resolve any problems that may rise
Chairman with directors as a result firm
1 performance will grow.
No of Executive Directors -
2 Accordingly, Barclays also in
No of Non Ex Directors - advantage when it comes to
9 executive directors because they
have very vast knowledge about the
 By doing so complied industry and have more experience,
with the code that additionally they manage the
mention as board should company and develop relevant
include an appropriate strategies for growth which enhance
combination of executive the frim performance.
and non-executive and
also the code that state By appointing majority of Non-
least half the board, executive directors, the company
excluding the chair, benefit by ensure that the Executive
should be non-executive Directors are operating as efficiently
directors as possible. Also NED Contribute to
the strategic plan of the company.
Monitor the performance of the
company and offer constructive ideas
and solutions, if required. Act in the
best interest of the shareholders.
pg. 12
Therefore though monitoring NED

enhance the performance of firm.
(Wallison,2006) claimed that having

independent directors on the board
was not for better performance but
for better governance in response to
the conflicting results of the
association between independent
directors and business performance.
.
Most NEDs have long careers behind

them and can bring solid experience
and contacts to a new company.
They may also bring a comforting
feeling of experience and gravitas to
a newly-formed company.
Therefore an independent majority

on the board is more likely to
consider the best interests of
shareowners first. It also is likely to
foster independent decision-making
and to mitigate conflicts of interest
that may arise.
pg. 13
5.0 Barclays (PLC) adherence to the composition,

succession, and evaluation principles (709)
Accountability Approach and Justification Implications
Components Did the company comply with Using empirical evidence in the
the code? Explain and justify academic literature appraise the
(using evidence from the importance of board evaluation on
company report and the code). improving board effectiveness and
company financial performance.
Review your company’s case based on
your analysis.
pg. 14
Board Evaluation Yes

These are the parameters take into
How often does the Annually evaluation internally account when conducting a board
board undertake an conduct to refresh thinking on evolution.
evaluation of the Board and Group Executive
board? composition Board Composition
determine a timeline for new Barclays have benefited from expertise
appointments also to evaluate of the NED
performance of each Board
Committees and individual Expertise No of
Directors Directors
Financial Services 12
Political 8
Current CEO/chair 9
Is there an external The 2021 Committee Accountancy/ Auditing 4
evaluation? Yes/No effectiveness evaluation was Operational Technology 1
externally facilitated, as Retail 1
required by the Code. The
Board appointed Christopher Barclay Board members provide
Saul Associates (CSA) to executives with a different perspective
facilitate the review. and direction, drawing on their wider
external experiences. So most
As part of its review, CSA effective boards meet regulatory
conducted one-on-one requirements, keep the company
interviews with each member accountable and provide sound
of the Committee and the strategic counsel.
Group Human Resources
Director. The term of board effectiveness can be
defined as boards’ ability to perform
CSA observed November their direction and control roles
2021 Committee meeting. effectively. At the same time, ensure
the company's success, genuinely add
Barclays have fulfilled the value to the organization, move the
compliance of The chair company closer to its goals, being
should consider having a about corporate performance that
regular externally facilitated satisfies the interest of
Board Nomination board evaluation. shareholder/stakeholder (Denis &
Committee McConnell, 2003)
(how it operates) Nomination Committee is
composed solely of NED and
is chaired by Chairman.
Following are principle Barclay’s board size is very smaller
activates of the committee when compared to other companies.
 Approval of the Jensen (1986) suggests that smaller
appointment of Venkat boards enhance communications,
as Group Chief choiceness, and coordination, make
Executive. effective monitoring and have a
 Candidate evaluation maximum of seven or eight members
for both executive and to function effectively
non-executive current
and future roles
pg. 15
 Review of the balance Barclays consist of 4 committees

of skills and diversity and all those 4 committees are
on the Board, handled by NED
 Review of Directors’
tenure and - Nominations Committee
effectiveness, -Audit Committee
 Identifying candidates -Risk Committee
for re-election at the -Remuneration Committee
AGM.
 Approval of changes in
Board Committee A committee is created to provide
composition during the counselling and advice for the board or
year to handle a task on the board's agenda
this will be very effective to board
Also it has mention in the effectiveness and board performance
Annual report of the Barclays
that All Directors are subject to A board evaluation is a process that
election or re-election (as measures the accountability,
appropriate) each year by transparency, and effectiveness of
shareholders at the AGM board members.
Length of tenure Barclays conduct a board evaluation

process annually.
Chairman has been with the
Barclays follow following steps to
company for two year period of
plan an effective board evaluation
time (From 2019-2021)
1. Outline the process
According to the annual report
Non-executive Directors Barclays has mention in the
tenure as follows annual report they use agenda
building tool when creating a
Years No of NED detailed program for the board
0-3 years 4 evaluation. This is done
3-6 years 1 internally so Minichilli et al. (2007)
6-9 years 3 argue that directors can be open
9+ 1 about feelings during the self-
evaluation as the processes will be
The Committee reviewed the kept confidential from outsiders
independence of the Non-
Executive Directors and, in the
cases of tenure period four of
the NED have been served for Appointment of Evaluation lead.
more than six years. The Barclays prefer to use an
nomination Committee external consulting firms with no
remains satisfied that the ties to the Board of Directors.
lengths of their tenure have no According to Machold and
impact on their respective Farquhar (2013), an “informed
levels of independence or the outsider” can challenge “deep-
effectiveness of their routed beliefs” of directors and offer
contributions. The Committee “opportunities for reflection to both
pg. 16
and the Board consider all of the researchers and the board
the Non-Executive Directors to members.”
be independent
Barclay’s board evaluation benefits of
regular assessments encourages
collaborative decision making and high
performance by individual directors. It
also encourages directors to work
together effectively to reduce conflict in
the boardroom and embed a culture of
good governance and team spirit.
6.0 Barclays (PLC) approach to audit, risk, and internal

control by examining its compliance to external auditor
rotations. (414)
Accountability Approach and Justification Implications
Components Did the company comply with Using academic theory and
pg. 17
the code? Explain and justify empirical evidence critically

(using evidence from the discuss the importance of
company report and the external auditor
code). rotation/independence on
company exposure to risk.
Drawing on the findings from
the academic literature,
evaluate the case of your
company.
External Auditors The choice to select KPMG Recent business failures on a
Who are the auditors of your as Barclays' external auditor global scale have raised
company? by holding an external audit several fundamental issues
tender will comply with the with audit quality and auditor
requirement of holding the independence (Ilaboya &
tender process and offering Ohiokha, 2014; Kharuddin,
recommendations to the 2015).
board, according to the
governance report.  Barclays maintain an
audit independence by
Moreover, PwC resigned as rotating the external
How long have they been the the Group's statutory auditor auditor which will
auditors? at the conclusion of the 2016 mitigate the rick of bias.
audit, and effective of the
2017 fiscal year, Barclays The audit quality may be
has appointed KPMG as its indirectly impacted by factors
external auditor. They began like rotation and tenure
working as auditors in 2017. (Memis & Cetenak, 2012;
This approach complies with Ratanasongtham &
the requirement that specifies Ussahawanitchakit, 2015).
information on the tenure of
 Every 10 years Barclays
the existing audit firm, the
call upon the tenders on
date of the most recent so that they can
tender, and early notice of experience an audit
How many years is their any plans for retendering. rotation, which will
contract? impact to the company
audit quality and
The Group has no plans to mitigates the risk of
submit a tender for a different being bias to the
external auditor before the company.
present necessary period of
10 years has passed. So, The length of the auditor's
any tender would be for the employment may have a
2027 fiscal year and beyond, favorable or unfavorable
and is likely to be held in effect on the quality of the
2025. audit. There are two
The aforementioned Barclays arguments around this topic:
Governance Report (Short tenure) suggests that
information complies with the the auditor will be less
requirement of the tendering familiar with the client's work,
procedure. and (Long length) suggests
that the auditor's
pg. 18
independence may weaken

(LIM et al, 2010; Knechel et
al, 2012).
 Barclays have 10 year
audit period that
suggests auditor will be
less familiar but audit
independence will be
achieved.
By considering all the facts it

is evident that Barclays
maintain an external auditor
independence and rotation
which will mitigates the
company risks.
7.0 The structure of remuneration for the CEO for the past
two years (743)
Remuneration Components Approach and Implications
Justification Compare and contrast the
pg. 19
Explain the approach to relationship between

remuneration and using remuneration and firm
academic theory justify the performance with the empirical
approach taken by the evidence in the academic
company. literature. Which of the three
theories (agency, managerial
entrenchment/power, and
institutional theory) best
explains your company’s
approach?
Structure of Remuneration Executive compensation As compensation is one of the
Most recent year (2021) offers sixteen ideas techniques employed to reduce
Total Pay – 100% applied CEO salary, and the agency problem, it is
Fixed Pay - % the sixteen theories are expected that executive
Annual Bonus - % categorized into three compensation will be
LTIP - % different approaches favourably correlated with firm
(Gomez- Mejia, 1994; performance.
Previous year (2020) Balsam, 2002).
Total Pay – 100% Since many chief executive
Fixed Pay - % Symbolic approach entails officers (CEOs) get exorbitant
Annual Bonus - % theories that view sums of remuneration,
LTIP - % executive compensation as frequently in the form of share
a socially constructed options, despite their
Jes Staley stepped down as image to explain the companies' financial difficulties,
Group Chief Executive and stature, dignity, and high Colvin (2008)
an Executive Director on 31 regard placed on the
October 2021 and C. S. CEO's position inside the According to (Abdullah and
Venkatakrishnan was organization. Wan, 2013), a company's size
appointed as Group Chief and growth are more closely
Executive on 1 November Theories like stewardship related to executive director
2021. theory and psychological compensation than return on
contract theory are part of assets (ROA). The CEO's
Total Pay the symbolic method. compensation is clearly
correlated with company
Title 2020 2021 For instance, Barclays performance only in large
CEO 98.28% 98.23% mentioned in the organizations, in contrast.
FD 98.99% 98.08% remuneration report that (Cybinski and Windsor,2013)
compensation should be
Fixed Pay designed appropriately However, after the 2008
Title 2020 2021 taking the opinions, rights, financial crisis, there was a
CEO 86.21 62.29 and interests of reduced correlation between
FD 31.53 62.96 stakeholders into CEO compensation and
consideration. This entails performance (MVA, EVA, ROE,
paying attention to our and EPS) (Bussin and Modau,
Annual Bonus stakeholders' input and 2015) But contrast that with the
Title 2020 2021 making sure that it is negligible to non-existent
CEO 19.97 13.18 properly taken into account correlation between financial
FD 19.70 28.24 when making performance and the CEOs'
compensation decisions. guaranteed cost to the
LTIP company.
Title 2020 2021
pg. 20
CEO 17.72 According to the According to theory, agency

FD 17.33 36.62 psychological contract issues arise when ownership
theory, shareholders are and management of a company
. obligated to pay the agent are split apart, and costs are
a fair and reasonable required to address these
salary, and the agent is issues (O'Neill, 2003;
then required to fulfil his or Wasserman, 2006)
her duties in a way that
supports the pay scales Agency Theory
(Kidder and Buchholtz, Jensen and Meckling (1976)
2002). define an agency relationship
as a contract by which one or
For instance, according to more persons (the principal)
the annual report, Barclays hire another person (the agent)
ensures that executive to perform some service on
compensation is fair, clear, their behalf, giving the agent
and transparent for all of some of their decision-making
their stakeholders. power. By its nature, the
agency relationship is
The value approach is problematic if the principal and
based on the laws of the agent’s personal interests
economics of supply and are divergent.
demand as a means for
determining executive Managerial
compensation (Roberts, entrenchment/power theory
1956).
Managers, who place great
A higher human capital value on control while holding
base belongs to the CEO only a small equity stake, work
who is more to ensure their own job security,
knowledgeable and skilled even though they are no longer
(Combs and Skill, 2003). competent or qualified to run
As a result, an executive the firm (Shleifer and Vishny,
with extensive knowledge 1989). Walsh and Seward
and experience is (1990) discuss classes of
compensated more for his managerial entrenchment
or her position (Combs and practices.
Skill, 2003).
In corporate governance,
According to Barclays' management entrenchment is a
compensation a term used to describe a
reasonable fixed pay is situation where managers use
paid to CEO to their position to act in ways that
compensate his skills. only benefit themselves and not
the shareholders.
When executives are paid
more than the market rate,
they are less likely to Institutional theory is a research
consider leaving the tradition that traces its origins
company, which reduces back to foundational articles
turnover while increasing that discussed how
pg. 21
productivity (Balsam, organizational founding and

2002). change were driven less by
functional considerations and
Barclay’s states in their more by symbolic actions and
governance report that external influences than the
they have evaluated the theory at the time assumed
minimum compensation in (Meyer and Rowan, 1977).
the UK and US and give
executive directors salary The institutional theory views
that is above the local convergence and divergence
living wage. processes in corporate
governance as processes of
institutional change and
continuity and provides a
holistic perspective that takes
into account the influence of
economic market forces, social
and cultural forces in shaping
corporate governance
By considering all the theories it

is evident that Agency Theory
is been approached by the
Barclays PLC because the
agents (managers and
directors) act on behalf of the
shareholders and do not act
benefited only to them.
8.0 Conclusion (532)

The Financial Reporting Council's (FRC) UK Corporate Governance Code (UKCG code)
outlines best practices for board leadership and effectiveness, compensation, accountability,
and relationships with shareholders. The UKCG code has been used by all businesses with
pg. 22
premium equity share listings in the UK in their annual reports and financial statements.
According to the UKCG code, you must comply or give a reason.
Barclays has adhered to the code in terms of board leadership and purpose by fostering a
successful, inclusive culture. By doing this, the company may create its purpose, values, and
strategy and ensure that these are in line with its culture. They can also interact and connect
with stakeholders through digital platforms. In order to segregate the responsibilities of board
leadership and executive leadership, Barclays plc. used the division of responsibility principle by
assigning a separate ceo and chairperson to the company. Also, the corporation has nominated
non-executive independent directors to the board in order to prevent one dominance. Annual
evaluation programs and an external evaluation program have been conducted by the
succession and evaluation board to achieve the board composition. Barclays compiles the audit,
risk, and internal control principles by holding a tender for the external audit accessories. In
order to build a formal and open process for developing a policy on executive salary, a
compensation committee is chosen. As a result, Barclays Plc. is responsible for covering the
compensation principle.
It is advised that Barclays PLC maintain an external auditor tenor for five years in addition to the
aforementioned criteria. The duration of the current external auditor is ten years, according to
their annual report. Furthermore, the non-executive directors' terms should be six to five years;
nonetheless, some of them are listed as having terms of more than nine years in the annual
report. If this keeps on, such non-executive directors might have biases in favor of the
management of the company. It is clear from taking into account all the corporate governance
elements that Barclays PLC conformed with all the corporate governance standards to a
moderate extent.
The necessity of effective corporate governance processes has come into sharper light as a
result of scandals involving prominent corporations, financial crises, and unexpected corporate
collapse (puni and anlesinya 2020). Companies that follow clear corporate governance
guidelines are better able to manage efficient systems, regulate oversight, provide more
chances for growth, and have better access to resources, which improves overall performance
and lowers risks (bhagat and bolton 2019). Moreover, cg offers the framework through which
the company's goals are established, as well as the methods for achieving them and judging
performance (yasser et al. 2011). Corporate success is influenced by the number of directors,
their independence, the degree of gender diversity, and their dual role as CEO (Bhagat and
Bolton 2008). Joint board-management meetings and frequent meetings are associated with
improved company performance in these companies (agustia et al. 2022). Board independence
is said to have a positive relationship with firm performance and to improve firm performance
(hu et al. 2022; Shan 2019; Pucheta-Martnez and Gallego-Alvarez 2020). As a result, it is
obvious that corporate governance and company performance are mutually exclusive.
9.0 References
Barclays annual report Barclays-PLC-Annual-Report-2021.pdf
pg. 23
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Donaldson, T., & Preston, L. (1995). The stakeholder theory of the corporation: Concepts, evidence and
implications. Academy of Management Review, 20(1), 65-91.
https://doi.org/10.5465/amr.1995.9503271992
Ibrahim, U.A., & Danjuma, S. (2020). Effect of Corporate Governance on the performance of listed
deposit money banks in Nigeria. Science journal of business management, 8, 35.
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Brummans, B. H., Putnam, L. L., Gray, B., Hanke, R., Lewicki, R. J., &Wiethoff, C. (2008). Making sense of
intractable multiparty conflict: A study of framing in four environmental disputes. Communication
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Deetz, S. A. (1992). Democracy in an age of corporate colonization: Developments in communication and

the politics of everyday life. Albany, NY: State University of New York Press. Deetz, S. A. (1995).
Representational practices and the political analysis of corporations: Building a communication

perspective in organizational studies. In B. Kovaci ˇ c (Ed.), ´ New Approaches to Organizational
Communication (pp. 211–243).
Albany, NY: State University of New York Press. Donaldson, T. (1999). Making stakeholder theory whole.
Academy of Management Review, 24(2). doi:10.2307/259079 Donaldson, T., & Preston, L. E. (1995).
The stakeholder theory of the corporation: Concepts, evidence and implications. Academy of
Management Review, 20(1), 65–92. doi:10.2307/ 258887
Freeman, R. E. (1984). Strategic management: A stakeholder approach. Boston, MA: Pitman. Freeman, R.
E. (1995). The politics of stakeholder theory: Some future directions. Business Ethics Quarterly, 4(4),
411–421. doi:10.2307/3857340 Freeman, R. E. (1999). Divergent stakeholder theory. Academy of
Management Review, 24(2). doi:10.5465/amr.1999.1893932
Abdullah, SN 2006, „Directors‟ remuneration, firm‟s performance and corporate governance in

Malaysia among distressed companies‟, Corporate Governance, vol. 6, no. 2, pp. 162-174
Azim, M 2010, Board, shareholder and auditor monitoring: Effects on the performance of Australian
listed companies, Lambert Academic Publishing, Saarbrucken, Deutschland.
Bertrand, M & Mullainathan, S 2001, „Are CEOs rewarded for luck? The ones without principals are‟,
Quarterly Journal of Economics, vol. 16, pp. 901-932.
Bloom, M & Milkovich, G 1998, „Relationships among risk incentive pay and organizational
performance‟, Academy of Management Journal, vol. 41, no. 3, pp. 283-297.
Brealey, RA, Myers, SC & Marcus, AJ 2001, Fundamentals of Corporate Finance, 3rd edn, McGraw Hill,
New York.
pg. 24

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CG complaints in Barclays PLC

REPORT ON BARCLAYS PLC'S 2018 UK CODE OF

Student Name: Ruth Maneesha Evanjalin Gomis

Date: 15th March 2023

2.0 Barclays relationships with its stakeholder’s (673)

approach of stakeholder theory in the The effects of transparency

It has benefits such as immediate

Communication Yes Company comply with codes Shareholders hire managers as

EPS of 37.5p 2020).

3.0 Barclays (PLC) approach to ensuring effective leadership

The Board Structure is comprised

Unitary board consists of a single

directors' duties and other

Executive directors often make up

Because the chairman is solely

Barclays PLC's board of directors

Company has been effective with

Barclays Board was appointed by

individual, he or she shall

Benefits of Dual Board Structure

Therefore the separation of CEO-

4.0 Barclays (PLC) compliance with the requirements for

Independence Yes Berghe and Baelden (2005)

Therefore though monitoring NED

(Wallison,2006) claimed that having

Most NEDs have long careers behind

Therefore an independent majority

5.0 Barclays (PLC) adherence to the composition,

Board Evaluation Yes

 Review of the balance Barclays consist of 4 committees

Length of tenure Barclays conduct a board evaluation

6.0 Barclays (PLC) approach to audit, risk, and internal

the code? Explain and justify empirical evidence critically

independence may weaken

By considering all the facts it

Explain the approach to relationship between

CEO 17.72 According to the According to theory, agency

productivity (Balsam, organizational founding and

By considering all the theories it

8.0 Conclusion (532)

Barclays annual report Barclays-PLC-Annual-Report-2021.pdf

Deetz, S. A. (1992). Democracy in an age of corporate colonization: Developments in communication and

Representational practices and the political analysis of corporations: Building a communication

Abdullah, SN 2006, „Directors‟ remuneration, firm‟s performance and corporate governance in

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