Appendix
Corporate Governance,
the Legal Environment, and Taxation
Prepared by
Norm Althouse
University of Calgary
Copyright © 2011 by Nelson Education Ltd.
1
Learning Outcomes
1. Explain corporate governance, and why it is important.
2. Review how the legal system governs business
transactions and settles business disputes.
3. Discuss the required elements of a valid contract.
4. Explain some of the Canadian laws that protect
businesses and consumers.
5. Discuss the Employment Standards Acts.
Appendix
6. List the most common taxes paid by businesses.
Copyright © 2011 by Nelson Education Ltd.
2
Corporate Governance
Governed
The way
a firm
is:
Directed
Administered
Appendix
The Board of Directors and the officers of the company
are responsible to ensure that the organization is being
managed in the best interest of the corporation.
Copyright © 2011 by Nelson Education Ltd.
3
Appendix
The Legal System
Laws
rules of conduct in society created
and enforced by a controlling
authority, usually the government
Public Law
relating to an individual or
business and the government
Private Law
between individuals, businesses,
or individuals and businesses
Copyright © 2011 by Nelson Education Ltd.
4
Business Law
Body of law
that governs
commercial
dealings
Nonjudicial Methods of
Settling Disputes
Appendix
Arbitration
Mediation
Copyright © 2011 by Nelson Education Ltd.
5
Appendix
Contract Law
Contracts
an agreement that sets forth
the relationship between parties
regarding the performance of a
specific action
Express Contract
specifies the terms of
the agreement
Implied Contract
depends on the acts and
Conduct of the parties to
show agreement
Copyright © 2011 by Nelson Education Ltd.
6
Appendix
Contract Requirements
Agreement
Each party has entered into the
agreement freely, without duress.
Capacity
Legal ability to enter into contracts.
Consideration
Exchange of something of legal value
or benefit between the parties.
Lawful Object
Absence of illegality.
Legal Form
Oral or written form, as required.
Copyright © 2011 by Nelson Education Ltd.
7
Appendix
Remedies for a Breach of a Contract
Payment of damages
Pay for the
damages caused
Specific performance
Complete the
requirements of the
contract
Restitution
Returning the parties to
the situation that existed
before the contract
Copyright © 2011 by Nelson Education Ltd.
8
Protection
Patents – inventors
Copyrights – creators of art, music, etc.
Trademarks – exclusive use of design,
name or other distinctive mark
Bankruptcy and Insolvency Act
Appendix
Deregulation of Industries
Tort Law
Copyright © 2011 by Nelson Education Ltd.
9
Consumer Protection
 Right to refuse to buy any product
 Right to expect products to be safe
 Right to expect product is as represented
 Right to receive adequate information
Warranties
Appendix
Product-Liability Law
Competition Act
Copyright © 2011 by Nelson Education Ltd.
10
Employment Standards
maternity
minimum wages
vacations
overtime
Appendix
layoff and recall
general holidays
(statutory)
employment of
children
parental leaves
termination
Copyright © 2011 by Nelson Education Ltd.
payment of
earnings
hours of work
11
Taxes
income taxes
Responsibilities
of a
Business
property taxes
payroll & employer contributions
Appendix
sales and excise taxes
Copyright © 2011 by Nelson Education Ltd.
12