EPSILON GROUP MEMBERS 110759 MURITHI ALLAN MUNENE 096493

EPSILON GROUP MEMBERS 110759 MURITHI ALLAN MUNENE 096493 MUTEMI ESTHER MWIKALI CORPORATE GOVERNANCE ISSUES IN GOOGLE 101550 NICOLE NTHOKI NGUMI 112697 MUANGE RITA MUENI 100583 MUCHIRI DERRICK -MUKARU PATIENCE WANGARI 99858

Google’s corporate structure • Google has a cross-functional organizational structure, which is technically a matrix corporate structure with a considerable degree of flatness. This flatness is a defining structural feature that supports the company’s growth and competitiveness. • The corporate structure is designed to support the need for innovation and creativity. • The company’s organizational structure promotes product development to facilitate high performance and competitiveness in the Internet services industry. In this way, the organizational structure contributes to business optimization to address competitors, such as Apple, Amazon. com, Facebook, IBM, Intel, Microsoft, Snap Inc. (Snapchat), and Twitter. • These firms are aggressive competitors, but Google’s corporate structure strengthens business competencies to counteract competitive forces.

Roles and responsibilities of the board � Though the firm tends to minimize the bureaucratic structures, the board of directors makes all decisions. � The company is overseen by a board of directors, which passes instructions down through an executive management group. � This group oversees several departments such as Engineering, Products, Legal, Finance and Sales. Each of these departments is divided into smaller units. � The directors’ responsibility is to oversee the day-to-day operations of the firm. � The directors run the firm with the help of various committees including executive compensation committee.

Integrity and ethical behavior • ‘’Do the right thing” a phrase used in Google's corporate code of conduct which is also preceded as a motto. It has taken the liberty to publish a code of conduct which is a public facing document that outlines a set of expected behaviors from their employees, board members and partners to know and follow. • Do the right thing is utilized as the basis to ingrain across their organization that describes their ethical, social and environmental sustainability. Google applies those words to how they serve their user as it is more of providing unbiased access to information, focusing on their needs and giving them the best products and services as well as adhering to government regulations and financial controls. • Employees are required to adhere to their defined acceptable ethical standards and the laws failure to which their employment contract will be terminated.

Disclosure and transparency • Google on the regular shares data that sheds light on how policies and actions of the government and corporations affect privacy, security and access to information online. • Since 2010 Google started releasing transparency report. This in turn enables Google to keep it's users’ security and privacy safe and control the type of content put on the platform as well regulate the content put out by use of set guidelines. • The firm has put control measures in financial management as well as disclosure of critical information concerning the firm. For instance, the financial information must be processed, recorded, summarized and reported within the required period. Such information should be communicated to the CEO and CFO before its release to the public. The management must also approve such information and make decisions regarding disclosure.

Corporate Social Responsibility • • Google’s overall CSR performance is satisfactory. • In addition, the firm’s philosophy, you can make money without doing evil, pushes Google to engage in CSR activities that benefit the stakeholder groups of employees and communities and satisfy regulatory requirements. • Example of Google CSR activities: Earthquake relief in West China(2008), Waste reduction and recycling(Google green) just to mention a few. The company’s philosophy, focus on the user and all else will follow, has led to useful and popular products that make the business profitable and beneficial to users, customers and investors.

Conclusion In conclusion, Google’s corporate governance is good but it still needs to improve on certain areas • The company should provide more room for shareholders to exercise their voting rights and make contributions in the final decisions. • The organization should put in place measures that ensure regulations, contributions and views of other parties such as policy makers, governments and various agencies are taken into consideration • Focus on the observance of individual rights and freedoms- concerns on the privacy of users. • The company should review the mode of board’s recruitment and specify the maximum period in which the board should be sitting- this is critical in prevention of issues concerning conflicting interests, fraud and mismanagement of resources.