Corporate Governance at Royal Bank of Canada
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Case Code: CGOX009 Case Length: 18 Pages Period: 2004 Pub Date: 2004 Teaching Note: Not Available |
Price: Rs.300 Organization: Royal Bank of Canada Industry: Financial Services Countries: Canada Themes: - |
Abstract Case Intro 1 Excerpts
Transparency impacts everything from strategy to culture, as well as a corporation's relationship with its various stakeholders. The Naked Corporation is a breakthrough - a timely and excellent perspective on successfully operating in today's open environment.
-Gordon M. Nixon, Chairman & CEO, RBC Financial Group.
Introduction
Royal Bank of Canada (RBC), headquartered in Toronto, Ontario, was the largest financial services group in Canada. In 2003, it ranked #337 in the Fortune Global 500 and #80 in Forbes Global 2000 and had a market capitalization of C$41.6 billion and an asset base of C$413 billion.($ 1.0 = C$ 1.31108)
On 26th November 2003, RBC received the Overall Award of Excellence for corporate reporting at the CICA. The Judging panels presented RBC with top scores in four categories: 1) Annual Reporting, 2) Corporate Governance Disclosure, 3) Electronic Disclosure and 4) Sustainable Development Reporting.
In August 20037, the Canadian Business magazine ranked RBC as the second best board8 in Canada. RBC had been ranked No.1 in 2001. RBC had adopted what observers considered many best practices in corporate governance. RBC's directors (in 2001) had to hold at least $100,000 in stock and had to stand for re-election every year. Any re-pricing of the stock options was not approved. The board published the attendance of each director at the Board and Committee meetings. The bank also scored high grades on the 'independence' of its directors. Out of the 19 directors standing for election, in 2002, only one director represented the bank's management. RBC had also decided to split the offices of the CEO and the Chairman. In 2001, had launched a Subsidiary Governance Office (SGO) in order to enhance governance practices in its subsidiaries. It installed sophisticated software that allowed quick and easy access to up-to-date information on all parts of its global network...
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