Background of Southern Cross
With the increasing rate of organizational development, maintenance of corporate governance has become very important in the organizational performance. It has been identified that this plays an important role in the case of influencing the decision making process as well as increasing the interest of the stakeholders in the case of influencing them in investment. Here the study has tried to shed light in the three important theories of governance. The impact of these governance theories in order to improve the organizational performance has been pointed out. On the other hand, the influence of governance theories in the case of improving the performance of both the profit and non-profit organizations have been highlighted. It has been mentioned in this study that the effective governance system has higher level of impact on developing the internal culture of the organization. Through this process, the relationship between the values of leadership and beliefs to influencing the effective governance programs in the organizational operations have been mentioned.
Governance theories have higher level of impact on the organizational performance. Therefore, assessment of governance theories is important for analysing its impacts on the organizational performance. Here the study has mentioned about three important governance theories such as Agency theory, Stewardship theory and Resource Dependence theory (Xiao, 2017). Agency theory is being considered as one of the important governance theory. In the case of this governance theory, the principles of the organizations are being designed. Here the executives are being hired by the managing team for developing the principles. These executives are being called as the agent. It has been mentioned in this study that the goals and objectives of the agent in the organization to develop proper principle in the organization so that it will be able to develop its performance management practices (Majda, 2014, September). It has been also analysed in the study that if the principle will face the agency loss regarding issues, in that case the return also decreases. Therefore this can be said that in order to maximize the rate of profitability, proper development of agency theory in the organization is required (Coule, 2015). This can be said that in order to suggest the financial rewards, agency theory is very important. By following this theory the organizational executive gets the chance to introduce different exiting executives that increases the profits to the owners. Therefore this can be said that the main purpose of the executive theory is to control, manage and monitor the performance of the organization (Zheng & Shao, 2015). Depending on this process, the further development in the case of bringing the changes in the decision making process of the company. The accountability operations are being managed by the agency theory.
Business Model of Southern Cross
The second theory, which has been mentioned in the study is about the Stewardship theory. In the theory it has been analysed that the executives or manager of the organization are considered as the stewards of the employers. If the goals and objectives of the company is being analysed, it will be identified that in the case achieving the goals and objectives of the organization both of them give the same effort as their goal is same (Madison, Holt, Kellermanns, & Ranft, 2016). Hence, this can be said that here all the executives and employers works together to achieve the organizational objectives. After analysing the stewardship theory this can be said that it is less dominant compared to the agency theory. This theory is much effective in the case of supporting each other in the organisational performance. Therefore, this can be said that in order to develop the healthy culture in the workplace, this theory is very supportive. Another way, this can be said that by developing the stewardship theory in the workplace, the organization gets the chance to develop the effective relationship between the executives and board (Joslin & Müller, 2016). The healthy relationship between the executive and board play an important role in the case of managing the training practices, mentoring as well as the decision making process of the company.
The third theory has been mentioned about the Resource dependence theory. It has been argued that the theory is very effective in the case of providing the resources to executives. It has been identified that by following this theory, the strong financial development, human resource development practices and intangible supports are being done to the agents (Biesenthal & Wilden, 2014). Therefore, this can be said that the organizational as well as the performance of the executives are being influenced by following this theory. The study has highlighted that by following the Resource dependence theory the executives are being trained so that they will be able to do their job properly. On the other hand, this can be said that by improving the performance of the executives, the overall [productivity of the organization get improved (Bergeron, 2015, January). By following this theory, the board members also get the chance to tap into the networks for grabbing the attention towards the organizational resources. It has been recommended in this theory that ion the case of this theory, the decisions regarding the organizational development are being taken by the board of directors.
Acquisition by Blackstone
Stewardship theory of governance can be applicable for both profit as well as non-profit organisations because regardless of its sizes or functionality, all these organisational need to have proper stature which will monitor the performance of the whole firms. Based on this monitoring, this structure will be planning for the future of the firm (Wu, Straub, & Liang, 2015). There are various governance theories which the firms can easily refer as models and apply them in the organisation in reaching the desired goals but the success depends on the choosing and application of the right one of them. in this aspect the theory of Stewardship is perfect for any kind of organisation both public as well as private.
Unlike any other theory this particular theory is associated with the belief that the managers of the firms are not always rational self-interested maximers. According to the stewardship theory, the company executives are the most responsible people to guide the organisation. It is defined through this theory that the executives of nay organisation can protect the interests of the stakeholders and shareholders and make decisions on their behalf. The sole objective of these executives is to help the organisation prosper by the means of creating scopes for the shareholders to gain prosperity. The executives who embrace this particular theory mainly place the chief executives at the centre of the organisation and the board of directors comprising the inhouse members. The goals of these board directors are perfectly aligned with the managers of the organisations where all of these people try to act in support to serve the interest of the firm. According to this theory, the executives and managers all are motivated to focus on the intangible rewards like the opportunities of personal as well as professional growth as well as achievements (Viader & Espina, 2014). According to this theory, the managers of the organisation motivate the employees in such a way that the employees work selflessly in serving the interest of the ornamentation more successfully (Turel & Bart, 2014). This method can be more applicable for the non-profit organisations as the focus of this kind of organisation is more selfless. Moreover, this theory captures the way through which the employees and mangers along with the executives can satisfy the organisational as well as cultural preconditions. In this model of Stewardship, the managers and the owners need to share the common agenda as well as work simultaneously. The emphasis of this particular model is on the role of the board in the process of developing strategies to gain success of meeting all the organisational goals rather than on the process of monitoring the performance as well as the preponderance of the internal directors or the executive director with the higher levels of access to the information is permitted.
Flotation on London Stock Exchange
It is implicating in the stewardship theory that this is an understanding of the process of the owners or more precisely the principals who remain prepared to take any type of risks on behalf of the organisations as well as the method on how the managers will operate their business then provide the return on the investments of the shareholders. Unlike the agency theory, there is a high level of trust among the executives as well as the employees of the organisation which is absent in the agency theory. The stewardship theory of governance mainly focuses on gaining the clear objective of the shareholder satisfaction. Through this theory the originations get one voice as the organisations have a single leader in them that creates one singular channel for communicating business to the stakeholders and the shareholders. Through this model the companies are being able to avoid the confusion regarding the ownership and importance of the executives. This mitigates the problem as to who actually is in the charge as the companies need to weather storm. Stewardship governance of the organisations for both profit and non-profit require that the Chief Executives be dependable on the organisations of the organisations. This will make the people of the organisation keen to put the personal gains aside for the betterment of the organization (Heide, Kumar, & Wathne, 2014). Therefore, this particular theory is the most effective for the internal as well as extremal growth of the organisations and gain popularity among all the stakeholders associate with the employees.
The effective governance of the organization is heavily dependent on the beliefs and the values that are maintained by the leader of the organization. The values of the leader of the organization might be held responsible for the various matters that are responsible for the effective governance of the organizations that have been operating in the given market territory (Giltinane, 2013). The ethical leadership on the part of the leader might help in the matters that deal with the overall performance of the concerned organization. The ethical leadership of the concerned leader might include the matters that pertain to the responsive integrity of the of the various members of the workforce of the organization which in turn helps the concerned organization to flourish and thereby depict an overall improvement in the operations of the concerned government.
The effective performance of the team of employees within the organization is known to have been dependent on the qualities depicted by the leader of the concerned team or the organization as a whole. The leader is generally heard to be responsible for the depiction of the various leadership skills that are responsible for the effective governance of the various members of the team of employees who have been serving the organization under the guidance and the motivation of provided by the concerned leaders (Chin, Hambrick, & Treviño, 2013). The effective leader must display the qualities of the effective leadership in order to help in the effective improvement in the governance of the workforce of the concerned organization. The leaders should depict the competence in the matters that pertain to the concerned business organization. The leader must be competent enough to deal with the various employees who have been serving the organization under the concerned person. The competence of the leader might be considered to be one of the key characteristics that must be depicted by the concerned leader (Carter & Greer, 2013). The competence on the part of the leader in the matters that pertain to the handling of the numerous crises and challenges that might arise tends to put forth the role of the various leaders in the matters that pertain to the governance and the maintenance of the various members of the workforce of the organizations. The leaders of an organization are expected to display both the leadership and the professional competencies. The professional competency of the concerned leader refers to the expertise of the leader in terms of the professional aspects of the concerned job. The leadership competencies of the leader however refer to the understanding of the leaders in the matters that pertain to the understanding of the leader in matters that pertain to the responsibilities of the leader and the leadership approaches that might need to be implemented by the leader in the various situations that might arise within the organization (Bamford, Wong, & Laschinger, 2013). The leader must also depict the qualities that relate to the accountability of the concerned leader in the matters that pertain to the undertaking of the various decisions on the part of the leaders as well as the concerned management body of the organization. The concerned leader must also depict the qualities that pertain to the integrity and the openness on the part of the leader which helps in the circulation of the various ideas that might be put forth by the various members of the workforce.
Financial Struggles and Challenges
In order to maintain a good governance within the organization, the leaders might be advised to demonstrate the practices of the qualities that are needed in order to deal with the workforce of the organization in an effective manner. The leader should be able to depict the competency in the matters that are related to the efficiency and the effectiveness of the discharge of the duties and the responsibilities of the concerned leader (Yang, 2014). The leader might also depict the qualities of accountability in order to deal with the various matters that might arise within the concerned organization. The accountability of the concerned authority in terms of the various matters that might have been affecting the performance of the concerned members of the workforce in the given organization. The accountability of the concerned management might be dependent on the various matters that deal with the implementation of the various rules and regulations on both the internal and the external matters of the concerned organization. the good governance of the organization might also depend on the openness of the leader in the matters that deal with the novel ideas that are shared by the workforce members of the organization (Sendjaya, Pekerti, Härtel, & Hirst, 2016). This might however include the matters that deal with the enclosing of the confidential information by the leader. The leader should not disclose confidential information under any circumstances.
Conclusion
In the above study, it has been identified that governance theorises have higher level of contribution in improving the performance of the organization. After analysing all the three theories, this can be said that stewardship theory is more effective in the case of bringing the improvement in the organizational productivity compared to the other two theories. However, following this theory the organizational performance as well as the relationship between the employers and employees gets improved. This is also very effective in the case of developing the internal culture of the organization. In this study, it has also been analysed in this study that development of proper leadership style is very important for implementing the governance practices in the organization.
References
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