Are You Smart Enough to Work at Google Essay Example

Are You Smart Enough to Work at Google Essay Are you Smart Enough to Work at Google Emerald | Are you Smart Enough to Work at Google: Fiendish Puzzles and Impossible Interview Questions from the Worlds Top Companies European Journal of Training and Development Article Information: Are you Smart Enough to Work at Google: Fiendish Puzzles and Impossible Interview Questions from the Worlds Top Companies To cite this article: David McGuire, (2013) Are you Smart Enough to Work at Google: Fiendish Puzzles and Impossible Interview Questions from the Worlds Top Companies, European Journal of Training and Development, Vol. 7 Iss: 5, pp. 502 504 To copy this article: [emailprotected] com The Reviewers David McGuire, School of Management, Edinburgh Napier University, Edinburgh, UK RR 2013/2Review Subject: Are you Smart Enough to Work at Google: Fiendish Puzzles and Impossible Interview Questions from the Worlds Top Companies William Poundstone Publisher Name: OneWorld Publications Place of Publication: Oxford Publication Year: 2012 ISBN: 9781851689170 Price: ? 8. 99 ($12. 6), paperback Article type: Review Pages: 290 pages Keywords: Emerald Journal: European Journal of Training and Development Volume: 37 Number: 5 Year: 2013 pp. 502-504 Copyright:  © Emerald Group Publishing Limited ISSN: 2046-9012 Book synthesis With a subtitle of â€Å"Fiendish Puzzles and Impossible Interview Questions from the Worlds Top Companies†, this text sets out to explore the evolving approaches taken by the worlds leading companies to recruiting and selecting the most creative and innovative staff.With companies such as Google receiving over one million job applications a year, organisations are looking for more sophisticated and original ways of zoning in on the most skilled applicants and rejecting unsuitable job-seekers. In the current recessionary and cost-cutting environment with many organisations becoming over flooded with applications for all positions, the use of unconventional interview questions and the practice of g etting job applicants to solve complex abstract problems has become more mainstream.Yet, to date, few insights have been given into how leading organisations have effectively redesigned selection strategies to promote core creativity and innovation values. The text is structured into ten chapters. The first chapter sets the context for the remainder of the text, examining how Google in particular is leading the field in the use of psychological testing for creativity, imagination and invention. Poundstone argues that Googles approach to encouraging creativity has led to revenue-boosting projects such as Gmail, Google Maps, Google News, Google Sky and Google Voice.Chapter 2 provides a brief history of the tools and techniques used by human resource departments in recruitment and selection and discusses the move away from job interviewing towards more innovative approaches to attracting the most creative staff. Chapter 3 looks at the effect that the credit crunch and recession have ha d in mainstreaming unconventional interviewing approaches. One such approach outlined relates to the â€Å"airport test†, which asks interviewers to â€Å"Just think about if you got stuck in an airport with the (job candidate), on a long layover on a business trip.Would you be happy or sad about it? †. The book suggests that a sense of fun from a job candidate can be quite important in determining their success in securing a job. Chapter 4 looks at the significant time commitment and elaborate process that Google goes www. emeraldinsight. com/journals. htm? issn=2046-9012volume=37issue=5articleid=17089641show=htmlview=printarticlenolog=148995 1/2 8/21/13 Emerald | Are you Smart Enough to Work at Google: Fiendish Puzzles and Impossible Interview Questions from the Worlds Top Companies through to select the best job applicant.It discusses the need for job applicants to ensure that their Linkedin and Facebook profiles are appropriately maintained to help them secure a de sired job position. Chapter 5 is a short chapter that emphasises the importance of intuition as Google, like many other organisations, seek individuals who are not only technically capable, but also able to relate to individuals on an intuitive empathetic basis. The second half of the book begins with chapter six which distinguishes between classic logic puzzles, insight questions, lateral hinking puzzles, Fermi questions and algorithm questions. Chapter 7 discusses the use of whiteboarding and how getting individuals to chart their thoughts can give interviewers a useful insight into the thought processes of job candidates. Chapter 8 is a short chapter which gives readers an insight into a style of questioning developed by Enrico Fermi at the Los Alamos National Laboratory (famous for making the atomic bomb). Fermi questions test job candidates analytical skills and include questions such as â€Å"How many golf balls would fit in a stadium? Chapter 9 focuses specifically on algori thm questions and provides readers with guidance about how to answer such questions. The final chapter provides some strategies to job applicants on how to salvage a doomed interview. It offers suggestions such as brainstorming, critiquing, analogising and disambiguating. Evaluation Providing an in-depth insight into the approaches being taken by the worlds top employees in attracting the best staff is invaluable to job applicants, HR staff involved in resourcing and University professors tasked with teaching students on contemporary selection techniques.The book provides lots of examples from leading companies such as Google, Microsoft, Nordstrom and Apple. The book is particularly suited to individuals who enjoy puzzles and possess an analytical mathematical mind. Such individuals will enjoy the challenge of solving such problems and may be likely to grab a pen and some paper to work on calculations and problemsolving approaches. Each chapter begins with a context-setting story wh ich often takes the form of an interviewee struggling to solve a complex question or puzzle posed by an interviewer.The story provides a useful transition to exploring changes in how new employees are selected and how companies are deprioritising IQ and focusing instead on the creativity and analytical skills of applicants. At times, the discussion in the text can become overly technical and would benefit from a stronger, more descriptive narrative. One key benefit of the book however is that it contains 120 pages of answers and detailed explanations to the puzzles and riddles outlined in the text. This will be a great benefit to ambitious individuals who want to prepare for interviews in leading global organisations.In the authors own words â€Å"The great physicist Richard Feynman once applied for a job at Microsoft. ‘Well, well Dr Feynman’, the interviewer began. ‘We dont get many Nobel Prize winners, even at Microsoft! But before we can hire you, theres a sli ght formality. We need to ask you a question to test your creative reasoning ability. The question is, why are manhole covers round? ’ ‘Thats a ridiculous question’, Feynman said. ‘For one thing, not all covers are round. Some are square! ’ ‘But considering just the round ones, now’ the interviewer went on, ‘Why are they round? ’ ‘Why are round manhole covers round?!?!Round manhole covers are round by definition. Its a tautology! ’. The interviewer then left the room for ten minutes. When he returned he announced, â€Å"Im happy to say that were recommending you for immediate hiring into our marketing department† (p. 69). Printed from: http://www. emeraldinsight. com/journals. htm? issn=20469012volume=37issue=5articleid=17089641show=html on Wednesday August 21st, 2013  © Emerald Group Publishing Limited www. emeraldinsight. com/journals. htm? issn=2046-9012volume=37issue=5articleid=17089641show=htmlview =printarticlenolog=148995 2/2

Chang Dai-Chien essays

Chang Dai-Chien essays Chang Dai-Chien is known for his skill of imitating traditional Chinese historical artists. He borrowed techniques from the diversity of Chinese art. Upon my arrival at the gallery the atmosphere of ancient epoch created by the paintings presented at the art show impressed me very much. The atmosphere of a different era was utterly amazing considering the fact that Chang Dai-Chien was a modern painter. The brush paintings, seen at the exhibition, were very interesting for several reasons, however the ones that appealed to me the most were symbolism and the imagery of the paintings. The importance of symbolism in Chinese Art is immense. It reveals and subsequently portrays cultural attitudes, conventions and events of a certain period of time, which makes the paintings not only the exquisite works of art but also a retrospective of history of China. Chang Dai-Chien was an acclaimed genius of his genre because he had an incredible ability to revive the atmosphere of the past. One painting that had a huge impact on me was Lofty Scholar Beneath the Pine (1982). It portrayed a man standing beneath the tree, contemplating. Even though it might sound like a very simple theme, the insight into its meaning brings about much more than can be said. The smoky clouds in the painting, the misty, dim peaks of the mountains set a mood of mystery; a scholar looking at the mountain peaks, at the beautiful pine tree adds a touch of enigma. The use of pastel tones of the clouds and mountains helps to support and reflect the symbolism of them, which can be interpreted as the mystery of the future and the unknown. Whilst the scholar may very well represent the quintessence of a human being trying to comprehend the essence of life. All of the Chang Dai-Chiens brush paintings comprise imagery that is quite symbolic, i.e. paintings such as White Pigeon Among White Leaves and Cloudy Waterfalls and Summer Mountains&qu...

Timed essay Example | Topics and Well Written Essays - 1500 words - 1

Timed - Essay Example Individuals within the hard sciences would point to the fact that the World Wide Web has promoted education and prompted a level of dialogue and discussion that would otherwise be constrained to specific scholarly journals. In terms of political science and governance, the World Wide Web has created a dynamic in which democracy and freedom of expression has come to be something that is expected by many individuals throughout the world. Furthermore, in terms of equality, gender rights, and the prevalence of violence, the Internet has assisted in seeking to reduce stereotypes and promote a more thoughtful level of engagement with respect to the individual rather than the group that they are supposed to be a member of. In short, the Internet has been a transformative force on each and every level; so much so that societies that have engaged with a high level of Internet use are invariably those that are among the most educated and fastest developing. However, all of this leads to a fund amental question; namely what the impact of the web has for the developing world. Firstly, with respect to issues of education, the impact is extremely powerful. Inquiring minds, educational facilities, and institutions within developing countries can provide invaluable resources to those that seek further education within their own sphere. Taking an example of rural schools within India or South Africa as a case in point, the reader can quickly appreciate the fact that these students have a wealth of resources, if they are connected to the web, that they might not otherwise have as a function of their own government education program or the texts/materials that they are required to read and understand as a function of their studies (Simons, 1998). Another relevant impact that the web has for developing countries is contingent upon the way in which it creates a further level of health understanding; both

The Bound between Corruption and Guanxi in the Chinese Society Coursework

The Bound between Corruption and Guanxi in the Chinese Society - Coursework Example The current state of literature provides an insight into what Guanxi is and how it works. Understanding the meaning of Guanxi is of vital importance for everyone who seeks to look deeper into the significance of corruption in the Chinese business system. Surprisingly or not, different authors provide different meanings of the term Guanxi. However, these differences are natural and even anticipated, given the complexity of the Guanxi concept and the multitude of meanings which it comprises. According to Chatterjee, Pearson, and Nie, the Chinese definition of Guanxi is hard to translate in one phrase – countless meanings are included in it, and it is fairly considered as one of the most impactful phrases in Chinese business contexts. However, it is possible to say that Guanxi can be roughly divided into the three basic groups of meanings: first, Guanxi presupposes the development of a relationship between people with a similar status; second, relevant and continuous connections between people; and third, contacts with people with little or no direct interactions. For the Chinese people, Guanxi exemplifies a type of special relationships in which one person needs something and another person has something to give. Guanxi is a highly dynamic form of relations between business people in China. Furthermore, even if a person who has resources and opportunities to solve a problem enters a Guanxi relationship, he (she) is not obliged to solve such a problem or respond to another individual’s request. Third, Guanxi is not a continuous phenomenon but emerges only the moment a person needs another person to do something important or solve some problem. Finally, Guanxi is almost always a sequence of previously planned activities aimed to resolve a business or personal issue. Here, western managers and people come to view Guanxi as a form of corruption, as long as such activities and relations may range from a simple meal together to giving gifts or doing favors. Â  However, whether Guanxi can be considered as a form of corruption remains a difficult question.

Golden Age of Capitalism Essay Example | Topics and Well Written Essays - 750 words

Golden Age of Capitalism - Essay Example This was a time when commerce was being revolutionized with the emergence of new technologies in transport and communication which facilitated the international markets. Railroads and steamships were used for land transportation of goods. This gave birth to the international market with goods being transported between countries such as America and England. The development of international commerce in manufactures on such a scale was only possible because of an increase in international flows of capital and the international provision of financial services (Milward 22). This was evident in post world war II economy of Europe. By 1950 more a great percentage of the income of foreign nations such Denmark was from foreign trade with other nations. The exchange rate between national currencies was stable despite the intensity among warring nations that was building up. As a result nations were able to prosper and grow economically and promote interdependence. The standard of living for ma ny citizens was at the time much better and continued to improve with the increase in the national income per capita as a result of economic success. Over the period 1950-70, the rate of growth of output in the construction sector was between 4 and 7 per cent a year over Western Europe as whole, and thus somewhat higher than the rate of growth of total output (Milward 52). This added to the success and economic dependence of nations after World War II. Thus different sectors of different nations that specialized in a trade to facilitate growth, rose considerably. The trade deficit with the dollar zone increased threefold between 1951 and 1957 (Milward 182). This increased output and western Europe had a surplus that was unprecedented. Help extended to the citizens of a nation post war was crucial in establishing the state as a means for the people to better themselves. The sweeping reform of the German pensions systems in 1955-7 , a bid by the Christian Democratic Union for a long-term middle class electoral support, had little in common, for example with the extension of public welfare in Sweden or Norway except an adherence to the view that the stability of the state required a positive response to the demand for welfare (Milward 47). This was important in conveying to the public that in accordance with the welfare policies in place, they too were to contribute to the growth of the economy in the countries mentioned. In my persp ective, this was a time of great trials and tribulations, those getting richer were foreign investors, bankers and merchants. Governments dealt a hand, and immersed their economies in the growing world market. This period thus gave rise to a flurry of new job opportunities in transportation and communication. The post-war reconstruction of nations aided by technological advancements was meant to rebuild the economy, promote industrialization and modernization. As a result of the success achieved in this endeavor, it was necessary for the governments to maintain it for purposes of achieving economic dependence. Political stability of this age put participating countries in the forefront of international trade, investments, travel and migration which increased more than any other period. It is incredible how nations were able to experience a period that was high in economic growth as a result of transportation and communication advancements. This period was unique and cannot at this time be

Executive Compensation and Stock Option in the UK

Executive Compensation and Stock Option in the UK 1 Introduction Todays highly competitive world consists of numerous corporations and these corporations are so huge and so large that it cannot be controlled by the people who own them. The control of these corporations is separated from shareholders who are the owners and vested into the hands of professional executives who are specifically hired for its management. This separation of ownership and control gave rise to agency problem or the principal-agent problem. Principal is referred to the stockholders and the agents are the executives who work for the stockholders. Although stockholders are the owners of the company to whom the executives are accountable, their actual powers are restricted except in the case of those corporations where stockholders are also the directors of that corporation. Stockholders have no right to inspect the books of accounts nor are they aware of the exact functioning and position of the firm. As a result, executives tend to work inefficiently without even bothering to look for profitable new investment opportunities, as well as they may use the firms assets for private purposes and also work to achieve their personal goals all at the expense of the shareholders. Some managers do not take any action whatever state or condition the corporation may be as they are risk averse and fear the threat of losing their job if a decision taken by them goes wrong. Therefore in order to avoid the various problems that arise due to the agency problem, executives must be properly and promptly compensated along with proper monitoring. In the beginning of 1990s, debates on corporate governance mainly focused on directors remuneration and fat cats. Fat cats are referred to those executives who provided themselves with huge compensation packages without any performance criteria. In UK, the most famous Fat Cat episode which saddened the shareholders of many large public companies and dragged the attention of the media was the notorious British Gas incident of the mid 1990s. Various issues arising out of executive compensation and the trouble of framing the deserved level of compensation, that has to be provided to an executive, made executive remuneration a main area of concern under corporate governance. According to Jensen (1993), providing the right level of remuneration to the executives and creating positive incentives in order to achieve the interest of the shareholders has been an important study conducted in many academic literatures. An improvement in corporate governance is brought about by filtering certain aspects of executive remuneration. There exists a wide gap between the remuneration paid to the executives and the remuneration paid to the other employees on the company. This gap keeps on increasing year after year as executives demand more and more for their services and decision making process to boosts the productivity and reputation of the firm which thereby increases the market price of the companys share. In a research mentioned in the Higgs Report (2003), chairmen of FTSE 100 companies in 2003 earned an average of  £ 426,000 as remuneration. Moreover, executives are being rewarded with stock options which would enrich them with abnormal profits in the future when the options granted to them are exercised. Critics argue that, executives are not worth for the remuneration paid because of their poor and unsatisfactory performance. According to Blitz (2003), MORI a leading market research company in the UK, through a survey, found 78% of the people unsatisfied by the remuneration paid to the executives. The pu blic in UK believe that executives are being overpaid for the amount of work they actually do. 2 Methodology This paper is a critical review on the various aspects of executive compensation in the UK and how the executive compensation especially the executive stock option encourage the managers and top executives, for their personal benefit, to take short term high risks and boost up the current value of shares rather than looking into the future and acting in favour of the stakeholders of the company. The tools used for the research mainly consist of various literature reviews of past articles and current working papers with some analysis of some statistical data regarding executive compensation. On the basis of the above mentioned area of research certain questions have been framed which will be critically looked into: a) Brief description of the executive compensation and corporate governance in the UK. b) Basic structure of executive remuneration in the UK and their disclosure requirements in United Kingdom. c) Are stock options considered the best means of remuneration in an executive compensation package? d) A brief historical overview of the introduction of executive stock option in the UK. e) What are the various manipulations done with executive stock option and what are the risk incentives created by executive stock option? f) Brief comparison of the UK executive compensation with the US executive compensation. g) The role of executive compensation in the UK banking towards the current financial crises. 3 Executive Compensation and Corporate Governance in the United Kingdom: During the past decade, various issues on corporate governance established the emergence of many reports and codes of best practice in the United Kingdom. These include the Inland Revenue (1988), Cadbury Report (1992), Greenbury Report (1995), Hampel Report (1998), The Combined Code (1998), Hermes Statement on Corporate Governance and Voting Policy (1998), Internal Control: Guidance for Directors on the Combined Code (Turnbull Report)(1999), Company Law Reform (1999) and Financial Services Market Act (2001) (Konstantinos Stathopoulos, Susanne Espenlaub, Martin Walker, 2003). Among these reports the Cadbury Report, Greenbury Report and the Combined Code, which emerged from the Hampel Report, focused on issues regarding executive compensation. 3.1 Cadbury Report (1992): The first guidelines of good practice on various issues of corporate governance were provided in the year 1992 by the Cadbury Committee which was established in May 1991 and was chaired by Adrian Cadbury. The Cadbury Committee discussed issues that were broader in nature than the executive remuneration but certain suggestions the committee made on altering the executive pay was accepted as permanent. The Cadbury report was titled as the Financial Aspects of Corporate Governance and came out with the Code of Best Practice, which insisted that decisions based on executive remunerations should not be made by the executive directors nor they have to get involved in making such a decision (1992, paragraph 4.42 p. 31). The report therefore recommended the appointment of a remuneration committee which will act in the interest of the shareholders of the firm and express a good opinion on various matters regarding executive compensation to the board. Companies in the UK responded spontaneousl y to this recommendation made in the Cadbury Report and established a remuneration committee within the firm (Bostock, 1995). The remuneration committee consists of a non-executive director as the chairperson and non-executive directors as its members who are all independent and free from the influence of the management. According to Williamson (I985), there always arises a question of doubt whether the directors make remuneration contracts for their own huge benefits and sanction it, if an independent pay committee does not exist. The role of remuneration committee is to ensure that executive compensation levels are set up in a formal, transparent way along with the goals required to be achieved by the executives for any schemes that are performance related. The remuneration committee can take advice from outside sources whenever necessary. The Cadbury report also suggested the establishment of an audit committee within each company which comprises of three non-executive directors (Martin Conyon, Paul Gregg and Stephen Machin, 1995). According to a questionnaire survey conducted by Conyon and Mallin (1997), by 1995, 98% of the companies followed the suggestions made by the Cadbury report and has reported the involvement of the remuneration committee in their annual reports. 3.2 The Greenbury Report (1995): Cadbury report failed to provide detailed guidance on how compensation packages have to be structured. However, it pointed out executive compensation to be the main area of study for the next committee known as the Greenbury Committee. The Greenbury Committee chaired by Sir Richard Greenbury, was formed by the United Kingdom Confederation of Business and Industry, and in 1995 it submitted the Greenbury report which dealt with matters regarding the determination and accounting of top executive pay. The main issues discussed in the Greenbury Report includes the role of the remuneration committee in an organisation, the disclosure requirement required by the shareholders of the organisation, the remuneration policies for compensating the executives and the service contracts provided to the executives. The remuneration policies recommended in the Greenbury Report are: a) Compensation packages must be provided by the remuneration committee to quality executives in order to influence, sec ure and encourage them and any payments extra to this intention must be avoided (Greenbury Report Paragraphs 6.5 – 6.7). b) The payments made and the subsequent resulting performance by other companies in the same industry must be evaluated by the remuneration committee. On the basis of this evaluation, the remuneration committee should relatively place their company (Paragraphs 6.11 – 6.12). c) While making changes to the annual salary of the executives, the remuneration committee should look into the payment and employment situations in other areas of the company rather than only concentrating on the executive pay and increasing them so as to satisfy the executives (Paragraph 6.13). d) The part of remuneration that is related to performance should be designed in such a way that the executives incentives go hand in hand with the interest of the shareholders and the executives are motivated to perform their duties with high standards (Paragraph 6.16). e) The performan ce conditions for executives to avail their annual bonuses, if any, should be designed to support and widen the operations of the business. The maximum possible amount of annual bonus an executive can avail should be taken into consideration by the remuneration committee and in some cases a part of these bonus payments can also be made by shares (Paragraphs 6.19 – 6.22). f) Under the long term incentive scheme, the Greenbury Report suggested that the shares and options granted to the executives should neither vest nor be exercisable, at least for a period of 3 years after such grant. The remuneration committee should encourage its executives to keep possession of their shares, after its vesting or exercise, for a long period of time (Paragraphs 6.23 – 6.34). g) The present existing long term incentive scheme should either be replaced by the new incentive scheme proposed or, the new incentive scheme proposed when combined with the old existing scheme should formulate a well structured incentive plan. The remuneration committee should make sure that the new long term incentive plan does not pay in excess than what is actually required for the executives and this new plan is accepted by the shareholders (Paragraph 6.35). h) The criteria for any long term incentive grant should be challenging and the performance of the executives should help achieve the goals set by the company in order to stand out from rest of its competitors. Key variables like the total shareholders return are used to judge the performance of the company with respect to its competitors (Paragraphs 6.38 – 6.40). i) Executive stock option grant or any other long term incentive grant must not be presented in lump-sum but should be awarded in series of stages. Moreover, no discount should be provided to the executives on the issue of executive stock option (Paragraph 6.29). j) While increasing the annual basic salary of the executives, the remuneration committee should look in to the effect of such increase on the executives pension entitlement and on the future expenses of the company particularly in case of those executives who are nearing retirement. The annual bonuses paid or any benefits paid in kind are not entitled for any pension payment (Paragraph 6.42 – 6.45). The aim of the Greenbury Report was not to cut down the executives remuneration but was to establish a balance between the compensation paid to the executives and their respective performance. On publishing the report in 1995 by the Greenbury Committee, certain tax advantages that was permitted on newly issued share options which comes under the approved executive share option scheme was withdrawn by the UK government. A new type of option scheme was introduced in November 1995 which had an upper limit of only  £20,000 on individual option holdings. Further, executive share options whose exercise price was earlier accepted at a discounted price of 15% on the existing share price at the time of grant was prevented (Konstantinos Stathopoulos, Susanne Espenlaub Martin Walker, 2003). According to Conyon (1994) in UK, the top executive director of a company was also made member of its remuneration committee before the launch of the Greenbury Report. However, the old fashioned executive share options schemes was not benefitted from the recommendations made by the Greenbury Committee as it not only seized the tax benefits but also encouraged to substitute options with long term incentive plans which in the UK is just awarding shares and not cash. The recommendations made by the Greenbury Report were not widely accepted as many of the critics believed that the report failed to link the executive pay with the performance of the company. 3.3 The Combined Code (1998): The Combined Code of the London Stock Exchange controls the various remuneration practices adopted by the companies listed in the London Stock Exchange. It has combined the recommendations given by the Cadbury Report and the Greenbury Report in order to form a regulation for efficient remuneration practice. The annual report of the companies listed should contain in a separate section the remuneration policy adopted by the company. The Combined Code requires a statement, in the annual report, showing that the remuneration standards mentioned in the code are being followed by the company and if any set standard is not complied with, the statement should point out the reason for the non compliance. A high level of executive remuneration disclosure is also required under the combined code and clear explanations about the various compensation packages provided to each executive director and non executive director should be stated (Konstantinos Stathopoulos, Susanne Espenlaub Martin Walk er, 2003). 4 Structure of Executive Remuneration in the UK: The typical structure of executive compensation in UK comprise of base salary, annual bonus, share options and long term incentive plans along with certain additional components like restricted stock and retirement plans. In 1997, an average executive compensation package consisted of 54% of base salary, 24% of annual bonus and 22% of non cash items which include share options and long term incentive plans (Martin J. Conyon, Simon I. Peck, Laura E. Read and Graham V. Sadler, 2000). Base Salary Determination of the base salary of an executive is done by taking into consideration the base salaries paid to executives of other companies in the same industry through surveys and analysis. This system of setting up and providing base salary is known as competitive benchmarking. Certain modifications are carried out on the base salary depending on the size of the firm, thereby linking executive compensation and firm size. In UK, base salary form the major part of the total executive remuneration paid. Base salary is that component of executive remuneration which is fixed and do not vary according to the performance, experience, age, etc of the executives. A  £1 increase in the base salary is preferred by executives who are risk averse than a  £1 increase in other components of executive compensation that are variable. Annual Bonus Bonus is provided to the executives on the basis of their performance during the relevant financial year. It is provided on an annual basis and the amounts paid as bonus to each executive vary from year to year. The performance of the executives is generally measured by taking into consideration accounting numbers which can be cross checked and audited. Executives have a clear idea of their daily performance by looking at the accounting numbers and they can forecast how overall profit of the company is going to look like at the end of the year. The drawback of relying on accounting numbers for measuring performance is that it is fully under the control of the executives and if wanted executives can manipulate the accounts in order to increase their annual bonus entitlement. Share Options Share options are contracts provided to the executives that cannot be traded which gives the executives the right to buy the shares of the firm at a price that is pre-determined known as the exercisable price for a specified time period. These contracts become void and have to be surrendered if the exercisable period mentioned has elapsed or if the executive resigns from the company before the exercisable period. This component of executive compensation is looked more into detail in the later section. Long-Term Incentive Plans – Long-Term Incentive Plans are provided to the executives in order to motivate and compensate them for achieving long term performance for the company. Grant of shares is the most typical form of LTIPs provided in the UK. These shares are vested to the executives only on achieving the objectives set by the company that is related to future performance. Earnings per Share and Total Shareholders Return are the two main elements by which the performance of the company is measured in the UK. Retirement Plans – Apart from the basic pension plans provided by the company, in UK, executives are encouraged to participate in an additional retirement benefit plan. These plans are a major source of concern because it symbolises invisible compensation. The actual value of executive retirement plan cannot be calculated by the available information provided in the books of accounts and the annual report. 4.1 Disclosure Requirement of Executives Remuneration in the UK: The Greenbury Report in 1995 identified three fundamental principles, which are accountability, transparency and performance linkage, in respect to executives remuneration. In UK, the current best practice disclosure pattern failed to compile with these fundamental principles therefore the government introduced certain necessary additions to the existing disclosure pattern. These latest requirements regarding disclosure of UK executives remuneration unifies the existing law, regulation and best practices that are mentioned in the UK Companies Act of 1985, the UK Listing Rules and the UK Combined Code of Principles of Good Governance and Code of Best Practice. The new requirement requires every company in the UK to adopt and prepare the directors remuneration report along with other necessary requirements. 4.1.1 Directors Remuneration Report (DRR): Companies listed in the London Stock Exchange should prepare the directors remuneration report for every financial year (Section 234B Companies Act) and should publish this report along with the accounts and annual report of the company (Section 244 Companies Act). The preparation of the remuneration report is done by the board of directors and not by the remuneration committee being, a committee accountable and responsible to the board and consisting only the non executive directors of the company. The remuneration of both the executive and non executive directors is clearly mentioned in the remuneration report. The fully prepared remuneration report should be filed with the registrar of companies (Section 242 Companies Act) and made available and provided to all the parties interested in the company such as the shareholders, debenture holders, and other persons who are required to attend the general meetings (Section 238 Companies Act). The remuneration report should contain all the information regarding the remuneration of the directors for the financial year completed i.e. the relevant financial year which includes disclosure of the amount receivable by the directors, whether paid or not, during the financial year as well as the disclosure of any amount paid as directors remuneration for any other period during the financial year (Companies Act, Schedule 7A, paragraph 19). The remuneration report should include the payments made to a third party for any services provided to the directors (Companies Act, Schedule 7A, paragraph 18(3)) and a statement showing the future remuneration policy of the directors. In UK, only the disclosure of directors remuneration is needed in the remuneration report. The name and information of every person who is the director, during the relevant financial year, has to be mentioned in the remuneration report. The remuneration report contains information that has to be audited by an external auditor (Companies Act, Schedule 7A, Part 3) and information need not be audited (Companies Act, Schedule 7A, Part 3). a) Information in DRR subject to audit: With regards to information subject to audit, the external auditor in his own consent should mention whether the information provided are prepared according to the necessary requirement and if any information is not complied as needed, the auditor should provide a statement showing them (Sections 235 and 237 Companies Act). The auditor will also look into disclosure information that are not subjected to audit and verify them with the company accounts as well as with the disclosure information that are audited. The various information included in the DRR that are subject to audit are: Emoluments and compensation For the services provided to the company as an executive or for any other services relating to the companys management, the salary, bonus, fees or compensation as termination of qualifying services received or receivable by the executives should be disclosed in the DRR. The overall value of non monetary benefits provided to the executives should be mentioned and the total aggregate of each kind of executive compensation provided in the relevant financial year should be compared with the previous financial year (Companies Act, Schedule 7A, paragraph 6). Share Options – The different types of shares options a company have should be mentioned along with their terms and conditions and besides each share option the total option each executive hold in the beginning of the relevant financial year as well as in the end should be disclosed. Detailed information of the various options provided during the year, its date of grant, its exercise price, date of expiry, number that have become void and number exercised and unexercised by the executives should be mentioned. If the share options are subject to any performance condition then the criteria has to be clearly described. For those shares that have been exercised, the market price during the time of exercise and for those shares unexercised ,the highest, lowest and the year end market prices have to be also mentioned. Since the disclosure of share options is a lengthy process, the aggregate of options each director hold is stated and the disclosure can be made on the basis of weighted average exercise pri ces (Companies Act, Schedule 7A, paragraphs 7-9). Long-term incentive schemes – Disclosure of scheme interests at the beginning and end of the current financial year which each executive hold must be made. Details of the type of scheme interest provided to the executives, its value and when it is vested in the year should be mentioned. If there are any conditions on the basis of which scheme interests will be granted then the relevant conditions should be specified (Companies Act, Schedule 7A, paragraphs 10 and 11). Other Information Details of executives pension scheme transfer value, any benefits that are accumulated over time and amount paid or payable by the company towards the money purchase pension scheme and retirement benefit scheme should be mentioned (Companies Act, Schedule 7A, paragraph 12). Amount received or receivable by the executives as benefits over and above the retirement benefit which he is entitled after 31st March 1997 should be included in the DRR (Companies Act, Schedule 7A, paragraph 13). If any person, who was once the executive of the company, has been given a special reward or if any third party is paid for their services provided to the executives during the relevant financial year it should be stated and disclosed (Companies Act, Schedule 7A, paragraph 14 15). b) Information in DRR not subject to audit: The information in the DRR that are not subject to audit is: Remuneration Committee – If any decision regarding the remuneration of the executives is taken by a committee during the financial year then the DRR must contain the name of all the non executive directors who were the members of such a committee and also should mention the name of any other person who is not the member of the committee but has been appointed by the members to assist them with certain services and advice. The details of the services rendered by the outside party should be clearly mentioned and this is done to ensure that the executive director play no role and influence the decision making of the committee (Companies Act, Schedule 7A, paragraph 2). Statement of policy on executives remuneration – A statement of future policy on executives remuneration for the coming financial years has to be included in the directors remuneration report (Companies Act, Schedule 7A, paragraph 3). The statement of policy should therefore disclose the conditions of performance, by an executive, for the entitlement of share option and long term incentive scheme along with the reasons for setting up such performance condition and the method used to assess the performance condition. If any executive fails meet the performance condition and does not benefit from the stock option grant or long term incentive scheme, the report should clearly state the conditions that are unsatisfactory. Details of the company on the basis of which the performance is measured should be provided in the report. Changes or amendments proposed to the existing terms and conditions for executives entitlement should be highlighted. Explanation should also provide for non-performance related remuneration and company policies on executives service contracts. This statement covers all directors from the end of the current financial year till the time when the report is put for voting by the shareholders of the company Performance graph – Publication of preceding 5 years performance graph should be included in the DRR showing the total shareholder return for holding shares whose listing transformed the company into a quoted company and for holding shares on the basis of which calculations are made for a broad equity market index. A fair method is used for the calculation of the total shareholder return along with various assumptions like the interest received on shares being reinvested (Companies Act, Schedule 7A, paragraph 4). Service Contract – During the relevant financial year if any executive is provided with a service contract, the date at which the service contract has been provided, its duration and its terms and conditions should be mentioned in the remuneration report. A detail of the termination compensation the executive is entitled to receive along with the companys liability on early termination is to be included (Companies Act, Schedule 7A, paragraph 5). On the complete preparation of the remuneration report, in the annual general body meeting it is introduced and called for a vote by the shareholders of the company (Section 241A Companies Act). This concept of voting the remuneration report was a controversial topic as many commentators suggested the voting to be limited to only the remuneration policy rather than the whole remuneration report. The reason they point out is that the executives remuneration policies are futuristic in nature so the shareholders can express their opinion on the policies adopted ra ther than making aware of the actual remuneration paid to each individual director. 4.1.2 Other Requirements: a) Along with the preparation of the DRR, disclosure of the aggregate compensation of the executive, loan given to the executives and other company transactions with the executive should be done in the notes of the annual accounts as mentioned in Schedule 6 of the Companies Act. b) As per Section 251 of the Companies Act and Companies Regulations (1995), listed companies in their summary financial statements should as a statement, state its policies regarding the remuneration of executives and the companys performance graph. 5 Stock/Share Options – Are they the Best in an Executive Compensation package? The most prominent and important component of executive compensation, in order to merge the interests of the executives with that of the interests of the shareholders, is providing the executives with stock options in the firms they serve (Jensen and Meckling, 1976). According to Jeffrey A. Williamson and Brian H. Kleiner, A stock option is a security that represents the right, but not the obligation, to buy or sell a specified amount of stocks at a specified price within a specified period of time. Stock options granted to executives of many large multinational firms are much higher in value than the annual cash pay they are entitled to be paid which in-turn boosts up the overall total compensation provided to the executives. This makes stock options the single largest ingredient in the current scenario of executive compensation. In the United States itself, stock options are held by more than 10 million employees (Simon R. and Dugan J., 2001) out of which around 160,000 of them tur ned out to be millionaires (Tate E.A. and Wilson T.E., 2001). Initially stock options were provided as a bonus to all the key executives of a company, but during the recent years its use is restricted only to the top level management. Providing stock options have resulted in increased productivity of the organisations. Executives are aware that their gain is linked with the stock performance of the organisation therefore they strive harder and work more efficiently to achieve progress. The main objective behind granting stock options is to make sure that executive make a profit on the success of the companys operations and in case of failures they suffer. Hence executive stock options link pay to performance. Critics argue to provide shares of stock rather than providing stock options in order to link pay and performance. The value of a stock option is only one third the value of a share, in case of companies having an average volatile stock price and yielding an average dividend the reason being stockholders receiving the whole value along with the dividend payment and the option holders benefitting only from the additional returns that is over and above the exercise price. This implies that options have a greater leverage and at the same cost, a company can provide its executives with options that are three times as much as that of shares. Stock options are incentive plans that are future Executive Compensation and Stock Option in the UK Executive Compensation and Stock Option in the UK 1 Introduction Todays highly competitive world consists of numerous corporations and these corporations are so huge and so large that it cannot be controlled by the people who own them. The control of these corporations is separated from shareholders who are the owners and vested into the hands of professional executives who are specifically hired for its management. This separation of ownership and control gave rise to agency problem or the principal-agent problem. Principal is referred to the stockholders and the agents are the executives who work for the stockholders. Although stockholders are the owners of the company to whom the executives are accountable, their actual powers are restricted except in the case of those corporations where stockholders are also the directors of that corporation. Stockholders have no right to inspect the books of accounts nor are they aware of the exact functioning and position of the firm. As a result, executives tend to work inefficiently without even bothering to look for profitable new investment opportunities, as well as they may use the firms assets for private purposes and also work to achieve their personal goals all at the expense of the shareholders. Some managers do not take any action whatever state or condition the corporation may be as they are risk averse and fear the threat of losing their job if a decision taken by them goes wrong. Therefore in order to avoid the various problems that arise due to the agency problem, executives must be properly and promptly compensated along with proper monitoring. In the beginning of 1990s, debates on corporate governance mainly focused on directors remuneration and fat cats. Fat cats are referred to those executives who provided themselves with huge compensation packages without any performance criteria. In UK, the most famous Fat Cat episode which saddened the shareholders of many large public companies and dragged the attention of the media was the notorious British Gas incident of the mid 1990s. Various issues arising out of executive compensation and the trouble of framing the deserved level of compensation, that has to be provided to an executive, made executive remuneration a main area of concern under corporate governance. According to Jensen (1993), providing the right level of remuneration to the executives and creating positive incentives in order to achieve the interest of the shareholders has been an important study conducted in many academic literatures. An improvement in corporate governance is brought about by filtering certain aspects of executive remuneration. There exists a wide gap between the remuneration paid to the executives and the remuneration paid to the other employees on the company. This gap keeps on increasing year after year as executives demand more and more for their services and decision making process to boosts the productivity and reputation of the firm which thereby increases the market price of the companys share. In a research mentioned in the Higgs Report (2003), chairmen of FTSE 100 companies in 2003 earned an average of  £ 426,000 as remuneration. Moreover, executives are being rewarded with stock options which would enrich them with abnormal profits in the future when the options granted to them are exercised. Critics argue that, executives are not worth for the remuneration paid because of their poor and unsatisfactory performance. According to Blitz (2003), MORI a leading market research company in the UK, through a survey, found 78% of the people unsatisfied by the remuneration paid to the executives. The pu blic in UK believe that executives are being overpaid for the amount of work they actually do. 2 Methodology This paper is a critical review on the various aspects of executive compensation in the UK and how the executive compensation especially the executive stock option encourage the managers and top executives, for their personal benefit, to take short term high risks and boost up the current value of shares rather than looking into the future and acting in favour of the stakeholders of the company. The tools used for the research mainly consist of various literature reviews of past articles and current working papers with some analysis of some statistical data regarding executive compensation. On the basis of the above mentioned area of research certain questions have been framed which will be critically looked into: a) Brief description of the executive compensation and corporate governance in the UK. b) Basic structure of executive remuneration in the UK and their disclosure requirements in United Kingdom. c) Are stock options considered the best means of remuneration in an executive compensation package? d) A brief historical overview of the introduction of executive stock option in the UK. e) What are the various manipulations done with executive stock option and what are the risk incentives created by executive stock option? f) Brief comparison of the UK executive compensation with the US executive compensation. g) The role of executive compensation in the UK banking towards the current financial crises. 3 Executive Compensation and Corporate Governance in the United Kingdom: During the past decade, various issues on corporate governance established the emergence of many reports and codes of best practice in the United Kingdom. These include the Inland Revenue (1988), Cadbury Report (1992), Greenbury Report (1995), Hampel Report (1998), The Combined Code (1998), Hermes Statement on Corporate Governance and Voting Policy (1998), Internal Control: Guidance for Directors on the Combined Code (Turnbull Report)(1999), Company Law Reform (1999) and Financial Services Market Act (2001) (Konstantinos Stathopoulos, Susanne Espenlaub, Martin Walker, 2003). Among these reports the Cadbury Report, Greenbury Report and the Combined Code, which emerged from the Hampel Report, focused on issues regarding executive compensation. 3.1 Cadbury Report (1992): The first guidelines of good practice on various issues of corporate governance were provided in the year 1992 by the Cadbury Committee which was established in May 1991 and was chaired by Adrian Cadbury. The Cadbury Committee discussed issues that were broader in nature than the executive remuneration but certain suggestions the committee made on altering the executive pay was accepted as permanent. The Cadbury report was titled as the Financial Aspects of Corporate Governance and came out with the Code of Best Practice, which insisted that decisions based on executive remunerations should not be made by the executive directors nor they have to get involved in making such a decision (1992, paragraph 4.42 p. 31). The report therefore recommended the appointment of a remuneration committee which will act in the interest of the shareholders of the firm and express a good opinion on various matters regarding executive compensation to the board. Companies in the UK responded spontaneousl y to this recommendation made in the Cadbury Report and established a remuneration committee within the firm (Bostock, 1995). The remuneration committee consists of a non-executive director as the chairperson and non-executive directors as its members who are all independent and free from the influence of the management. According to Williamson (I985), there always arises a question of doubt whether the directors make remuneration contracts for their own huge benefits and sanction it, if an independent pay committee does not exist. The role of remuneration committee is to ensure that executive compensation levels are set up in a formal, transparent way along with the goals required to be achieved by the executives for any schemes that are performance related. The remuneration committee can take advice from outside sources whenever necessary. The Cadbury report also suggested the establishment of an audit committee within each company which comprises of three non-executive directors (Martin Conyon, Paul Gregg and Stephen Machin, 1995). According to a questionnaire survey conducted by Conyon and Mallin (1997), by 1995, 98% of the companies followed the suggestions made by the Cadbury report and has reported the involvement of the remuneration committee in their annual reports. 3.2 The Greenbury Report (1995): Cadbury report failed to provide detailed guidance on how compensation packages have to be structured. However, it pointed out executive compensation to be the main area of study for the next committee known as the Greenbury Committee. The Greenbury Committee chaired by Sir Richard Greenbury, was formed by the United Kingdom Confederation of Business and Industry, and in 1995 it submitted the Greenbury report which dealt with matters regarding the determination and accounting of top executive pay. The main issues discussed in the Greenbury Report includes the role of the remuneration committee in an organisation, the disclosure requirement required by the shareholders of the organisation, the remuneration policies for compensating the executives and the service contracts provided to the executives. The remuneration policies recommended in the Greenbury Report are: a) Compensation packages must be provided by the remuneration committee to quality executives in order to influence, sec ure and encourage them and any payments extra to this intention must be avoided (Greenbury Report Paragraphs 6.5 – 6.7). b) The payments made and the subsequent resulting performance by other companies in the same industry must be evaluated by the remuneration committee. On the basis of this evaluation, the remuneration committee should relatively place their company (Paragraphs 6.11 – 6.12). c) While making changes to the annual salary of the executives, the remuneration committee should look into the payment and employment situations in other areas of the company rather than only concentrating on the executive pay and increasing them so as to satisfy the executives (Paragraph 6.13). d) The part of remuneration that is related to performance should be designed in such a way that the executives incentives go hand in hand with the interest of the shareholders and the executives are motivated to perform their duties with high standards (Paragraph 6.16). e) The performan ce conditions for executives to avail their annual bonuses, if any, should be designed to support and widen the operations of the business. The maximum possible amount of annual bonus an executive can avail should be taken into consideration by the remuneration committee and in some cases a part of these bonus payments can also be made by shares (Paragraphs 6.19 – 6.22). f) Under the long term incentive scheme, the Greenbury Report suggested that the shares and options granted to the executives should neither vest nor be exercisable, at least for a period of 3 years after such grant. The remuneration committee should encourage its executives to keep possession of their shares, after its vesting or exercise, for a long period of time (Paragraphs 6.23 – 6.34). g) The present existing long term incentive scheme should either be replaced by the new incentive scheme proposed or, the new incentive scheme proposed when combined with the old existing scheme should formulate a well structured incentive plan. The remuneration committee should make sure that the new long term incentive plan does not pay in excess than what is actually required for the executives and this new plan is accepted by the shareholders (Paragraph 6.35). h) The criteria for any long term incentive grant should be challenging and the performance of the executives should help achieve the goals set by the company in order to stand out from rest of its competitors. Key variables like the total shareholders return are used to judge the performance of the company with respect to its competitors (Paragraphs 6.38 – 6.40). i) Executive stock option grant or any other long term incentive grant must not be presented in lump-sum but should be awarded in series of stages. Moreover, no discount should be provided to the executives on the issue of executive stock option (Paragraph 6.29). j) While increasing the annual basic salary of the executives, the remuneration committee should look in to the effect of such increase on the executives pension entitlement and on the future expenses of the company particularly in case of those executives who are nearing retirement. The annual bonuses paid or any benefits paid in kind are not entitled for any pension payment (Paragraph 6.42 – 6.45). The aim of the Greenbury Report was not to cut down the executives remuneration but was to establish a balance between the compensation paid to the executives and their respective performance. On publishing the report in 1995 by the Greenbury Committee, certain tax advantages that was permitted on newly issued share options which comes under the approved executive share option scheme was withdrawn by the UK government. A new type of option scheme was introduced in November 1995 which had an upper limit of only  £20,000 on individual option holdings. Further, executive share options whose exercise price was earlier accepted at a discounted price of 15% on the existing share price at the time of grant was prevented (Konstantinos Stathopoulos, Susanne Espenlaub Martin Walker, 2003). According to Conyon (1994) in UK, the top executive director of a company was also made member of its remuneration committee before the launch of the Greenbury Report. However, the old fashioned executive share options schemes was not benefitted from the recommendations made by the Greenbury Committee as it not only seized the tax benefits but also encouraged to substitute options with long term incentive plans which in the UK is just awarding shares and not cash. The recommendations made by the Greenbury Report were not widely accepted as many of the critics believed that the report failed to link the executive pay with the performance of the company. 3.3 The Combined Code (1998): The Combined Code of the London Stock Exchange controls the various remuneration practices adopted by the companies listed in the London Stock Exchange. It has combined the recommendations given by the Cadbury Report and the Greenbury Report in order to form a regulation for efficient remuneration practice. The annual report of the companies listed should contain in a separate section the remuneration policy adopted by the company. The Combined Code requires a statement, in the annual report, showing that the remuneration standards mentioned in the code are being followed by the company and if any set standard is not complied with, the statement should point out the reason for the non compliance. A high level of executive remuneration disclosure is also required under the combined code and clear explanations about the various compensation packages provided to each executive director and non executive director should be stated (Konstantinos Stathopoulos, Susanne Espenlaub Martin Walk er, 2003). 4 Structure of Executive Remuneration in the UK: The typical structure of executive compensation in UK comprise of base salary, annual bonus, share options and long term incentive plans along with certain additional components like restricted stock and retirement plans. In 1997, an average executive compensation package consisted of 54% of base salary, 24% of annual bonus and 22% of non cash items which include share options and long term incentive plans (Martin J. Conyon, Simon I. Peck, Laura E. Read and Graham V. Sadler, 2000). Base Salary Determination of the base salary of an executive is done by taking into consideration the base salaries paid to executives of other companies in the same industry through surveys and analysis. This system of setting up and providing base salary is known as competitive benchmarking. Certain modifications are carried out on the base salary depending on the size of the firm, thereby linking executive compensation and firm size. In UK, base salary form the major part of the total executive remuneration paid. Base salary is that component of executive remuneration which is fixed and do not vary according to the performance, experience, age, etc of the executives. A  £1 increase in the base salary is preferred by executives who are risk averse than a  £1 increase in other components of executive compensation that are variable. Annual Bonus Bonus is provided to the executives on the basis of their performance during the relevant financial year. It is provided on an annual basis and the amounts paid as bonus to each executive vary from year to year. The performance of the executives is generally measured by taking into consideration accounting numbers which can be cross checked and audited. Executives have a clear idea of their daily performance by looking at the accounting numbers and they can forecast how overall profit of the company is going to look like at the end of the year. The drawback of relying on accounting numbers for measuring performance is that it is fully under the control of the executives and if wanted executives can manipulate the accounts in order to increase their annual bonus entitlement. Share Options Share options are contracts provided to the executives that cannot be traded which gives the executives the right to buy the shares of the firm at a price that is pre-determined known as the exercisable price for a specified time period. These contracts become void and have to be surrendered if the exercisable period mentioned has elapsed or if the executive resigns from the company before the exercisable period. This component of executive compensation is looked more into detail in the later section. Long-Term Incentive Plans – Long-Term Incentive Plans are provided to the executives in order to motivate and compensate them for achieving long term performance for the company. Grant of shares is the most typical form of LTIPs provided in the UK. These shares are vested to the executives only on achieving the objectives set by the company that is related to future performance. Earnings per Share and Total Shareholders Return are the two main elements by which the performance of the company is measured in the UK. Retirement Plans – Apart from the basic pension plans provided by the company, in UK, executives are encouraged to participate in an additional retirement benefit plan. These plans are a major source of concern because it symbolises invisible compensation. The actual value of executive retirement plan cannot be calculated by the available information provided in the books of accounts and the annual report. 4.1 Disclosure Requirement of Executives Remuneration in the UK: The Greenbury Report in 1995 identified three fundamental principles, which are accountability, transparency and performance linkage, in respect to executives remuneration. In UK, the current best practice disclosure pattern failed to compile with these fundamental principles therefore the government introduced certain necessary additions to the existing disclosure pattern. These latest requirements regarding disclosure of UK executives remuneration unifies the existing law, regulation and best practices that are mentioned in the UK Companies Act of 1985, the UK Listing Rules and the UK Combined Code of Principles of Good Governance and Code of Best Practice. The new requirement requires every company in the UK to adopt and prepare the directors remuneration report along with other necessary requirements. 4.1.1 Directors Remuneration Report (DRR): Companies listed in the London Stock Exchange should prepare the directors remuneration report for every financial year (Section 234B Companies Act) and should publish this report along with the accounts and annual report of the company (Section 244 Companies Act). The preparation of the remuneration report is done by the board of directors and not by the remuneration committee being, a committee accountable and responsible to the board and consisting only the non executive directors of the company. The remuneration of both the executive and non executive directors is clearly mentioned in the remuneration report. The fully prepared remuneration report should be filed with the registrar of companies (Section 242 Companies Act) and made available and provided to all the parties interested in the company such as the shareholders, debenture holders, and other persons who are required to attend the general meetings (Section 238 Companies Act). The remuneration report should contain all the information regarding the remuneration of the directors for the financial year completed i.e. the relevant financial year which includes disclosure of the amount receivable by the directors, whether paid or not, during the financial year as well as the disclosure of any amount paid as directors remuneration for any other period during the financial year (Companies Act, Schedule 7A, paragraph 19). The remuneration report should include the payments made to a third party for any services provided to the directors (Companies Act, Schedule 7A, paragraph 18(3)) and a statement showing the future remuneration policy of the directors. In UK, only the disclosure of directors remuneration is needed in the remuneration report. The name and information of every person who is the director, during the relevant financial year, has to be mentioned in the remuneration report. The remuneration report contains information that has to be audited by an external auditor (Companies Act, Schedule 7A, Part 3) and information need not be audited (Companies Act, Schedule 7A, Part 3). a) Information in DRR subject to audit: With regards to information subject to audit, the external auditor in his own consent should mention whether the information provided are prepared according to the necessary requirement and if any information is not complied as needed, the auditor should provide a statement showing them (Sections 235 and 237 Companies Act). The auditor will also look into disclosure information that are not subjected to audit and verify them with the company accounts as well as with the disclosure information that are audited. The various information included in the DRR that are subject to audit are: Emoluments and compensation For the services provided to the company as an executive or for any other services relating to the companys management, the salary, bonus, fees or compensation as termination of qualifying services received or receivable by the executives should be disclosed in the DRR. The overall value of non monetary benefits provided to the executives should be mentioned and the total aggregate of each kind of executive compensation provided in the relevant financial year should be compared with the previous financial year (Companies Act, Schedule 7A, paragraph 6). Share Options – The different types of shares options a company have should be mentioned along with their terms and conditions and besides each share option the total option each executive hold in the beginning of the relevant financial year as well as in the end should be disclosed. Detailed information of the various options provided during the year, its date of grant, its exercise price, date of expiry, number that have become void and number exercised and unexercised by the executives should be mentioned. If the share options are subject to any performance condition then the criteria has to be clearly described. For those shares that have been exercised, the market price during the time of exercise and for those shares unexercised ,the highest, lowest and the year end market prices have to be also mentioned. Since the disclosure of share options is a lengthy process, the aggregate of options each director hold is stated and the disclosure can be made on the basis of weighted average exercise pri ces (Companies Act, Schedule 7A, paragraphs 7-9). Long-term incentive schemes – Disclosure of scheme interests at the beginning and end of the current financial year which each executive hold must be made. Details of the type of scheme interest provided to the executives, its value and when it is vested in the year should be mentioned. If there are any conditions on the basis of which scheme interests will be granted then the relevant conditions should be specified (Companies Act, Schedule 7A, paragraphs 10 and 11). Other Information Details of executives pension scheme transfer value, any benefits that are accumulated over time and amount paid or payable by the company towards the money purchase pension scheme and retirement benefit scheme should be mentioned (Companies Act, Schedule 7A, paragraph 12). Amount received or receivable by the executives as benefits over and above the retirement benefit which he is entitled after 31st March 1997 should be included in the DRR (Companies Act, Schedule 7A, paragraph 13). If any person, who was once the executive of the company, has been given a special reward or if any third party is paid for their services provided to the executives during the relevant financial year it should be stated and disclosed (Companies Act, Schedule 7A, paragraph 14 15). b) Information in DRR not subject to audit: The information in the DRR that are not subject to audit is: Remuneration Committee – If any decision regarding the remuneration of the executives is taken by a committee during the financial year then the DRR must contain the name of all the non executive directors who were the members of such a committee and also should mention the name of any other person who is not the member of the committee but has been appointed by the members to assist them with certain services and advice. The details of the services rendered by the outside party should be clearly mentioned and this is done to ensure that the executive director play no role and influence the decision making of the committee (Companies Act, Schedule 7A, paragraph 2). Statement of policy on executives remuneration – A statement of future policy on executives remuneration for the coming financial years has to be included in the directors remuneration report (Companies Act, Schedule 7A, paragraph 3). The statement of policy should therefore disclose the conditions of performance, by an executive, for the entitlement of share option and long term incentive scheme along with the reasons for setting up such performance condition and the method used to assess the performance condition. If any executive fails meet the performance condition and does not benefit from the stock option grant or long term incentive scheme, the report should clearly state the conditions that are unsatisfactory. Details of the company on the basis of which the performance is measured should be provided in the report. Changes or amendments proposed to the existing terms and conditions for executives entitlement should be highlighted. Explanation should also provide for non-performance related remuneration and company policies on executives service contracts. This statement covers all directors from the end of the current financial year till the time when the report is put for voting by the shareholders of the company Performance graph – Publication of preceding 5 years performance graph should be included in the DRR showing the total shareholder return for holding shares whose listing transformed the company into a quoted company and for holding shares on the basis of which calculations are made for a broad equity market index. A fair method is used for the calculation of the total shareholder return along with various assumptions like the interest received on shares being reinvested (Companies Act, Schedule 7A, paragraph 4). Service Contract – During the relevant financial year if any executive is provided with a service contract, the date at which the service contract has been provided, its duration and its terms and conditions should be mentioned in the remuneration report. A detail of the termination compensation the executive is entitled to receive along with the companys liability on early termination is to be included (Companies Act, Schedule 7A, paragraph 5). On the complete preparation of the remuneration report, in the annual general body meeting it is introduced and called for a vote by the shareholders of the company (Section 241A Companies Act). This concept of voting the remuneration report was a controversial topic as many commentators suggested the voting to be limited to only the remuneration policy rather than the whole remuneration report. The reason they point out is that the executives remuneration policies are futuristic in nature so the shareholders can express their opinion on the policies adopted ra ther than making aware of the actual remuneration paid to each individual director. 4.1.2 Other Requirements: a) Along with the preparation of the DRR, disclosure of the aggregate compensation of the executive, loan given to the executives and other company transactions with the executive should be done in the notes of the annual accounts as mentioned in Schedule 6 of the Companies Act. b) As per Section 251 of the Companies Act and Companies Regulations (1995), listed companies in their summary financial statements should as a statement, state its policies regarding the remuneration of executives and the companys performance graph. 5 Stock/Share Options – Are they the Best in an Executive Compensation package? The most prominent and important component of executive compensation, in order to merge the interests of the executives with that of the interests of the shareholders, is providing the executives with stock options in the firms they serve (Jensen and Meckling, 1976). According to Jeffrey A. Williamson and Brian H. Kleiner, A stock option is a security that represents the right, but not the obligation, to buy or sell a specified amount of stocks at a specified price within a specified period of time. Stock options granted to executives of many large multinational firms are much higher in value than the annual cash pay they are entitled to be paid which in-turn boosts up the overall total compensation provided to the executives. This makes stock options the single largest ingredient in the current scenario of executive compensation. In the United States itself, stock options are held by more than 10 million employees (Simon R. and Dugan J., 2001) out of which around 160,000 of them tur ned out to be millionaires (Tate E.A. and Wilson T.E., 2001). Initially stock options were provided as a bonus to all the key executives of a company, but during the recent years its use is restricted only to the top level management. Providing stock options have resulted in increased productivity of the organisations. Executives are aware that their gain is linked with the stock performance of the organisation therefore they strive harder and work more efficiently to achieve progress. The main objective behind granting stock options is to make sure that executive make a profit on the success of the companys operations and in case of failures they suffer. Hence executive stock options link pay to performance. Critics argue to provide shares of stock rather than providing stock options in order to link pay and performance. The value of a stock option is only one third the value of a share, in case of companies having an average volatile stock price and yielding an average dividend the reason being stockholders receiving the whole value along with the dividend payment and the option holders benefitting only from the additional returns that is over and above the exercise price. This implies that options have a greater leverage and at the same cost, a company can provide its executives with options that are three times as much as that of shares. Stock options are incentive plans that are future

Instant Messenger Programs Essay -- Communication Computers Internet E

Analysis of Instant Messenger Programs From telegrams to telephones, to emails and faxes, people have had a strong desire to be connected to one another. The onset of the information age has only increased that desire - to the point that people are seeking a constant connection. The introduction of instant messenger programs has allowed people to be connected and communicate in real-time. Instant messaging not only provides transfer of text messages, but peer-to-peer file sharing as well. While file transfer provides the user with increased convenience, it also increases the odds of transferring viruses, worms, and other malware. This paper will discuss the major instant messenger programs: AOL IM, .NET Messenger, ICQ, and Yahoo! Messenger. In particular it will explore the threats and security risks involved in both personal and professional use of instant messenger programs. Introduction As the name suggests, instant messaging, or IM, is the real-time delivery of a message from one user to another. Communication between any computing stations can occur as long as the appropriate version of the program is installed. Users must also be concurrently running an IM client (program) as well as be on the same IM network [7]. A conversation that occurs between two or more users is known as a session (or channel). A session can either be public, where any and all users can participate, or private, where users must be invited to participate in the session. Buddy lists, also known as contact lists, allow users to maintain communication with specific users of the same IM client and network. While each instant messaging program is unique, they all employ similar client-server architecture to send and receive m... ... [5] Gaudin, Sharon. â€Å"Norton Antivirus Attacks Instant Messaging.† www.instant-messaging.com. August 2002. [6] Grimes, Roger A. "IM Security Primer." www.secadministrator.com. May 2002. [7] Hindocha, Neal. â€Å"Instant Insecurity: Security Issues of Instant Messaging.† www.securityfocus.com. January 2003. [8] Hindocha, Neal. â€Å"Threats to Instant Messaging.† Symantec Security Response. January 2003. [9] Hu, Jim. â€Å"Worms Find Fertile Ground in IM.† www.cnetnews.com. August 2001. [10] Shinder, Thomas. â€Å"How to Block Dangerous Instant Messengers Using ISA Server.† www.windowssecurity.com. July 2002. [11] Thorsberg, Frank. â€Å"Is IM a Sieve for Corporate Secrets?† www.pcworld.com July 2002. [12] Varnosi, Robert. â€Å"The Problem with Instant Messaging Apps at Work.† www.cnet.com. August 2002

Environmental and Competitive Analysis of Easyjet Essay

This report has been written in order to provide an environmental and competitive analysis of the low-cost airline industry sector from the position of Easyjet. It will give a brief history into Easyjet and the low-cost airline industry. It will analyse the internal strengths and weaknesses as well as the external threats and opportunities. Competitors will be analysed through the use of porters 5 forces model. Recommendations will be made for EasyJet’s marketing strategies for the next three years. Corporate History Easyjet was founded in 1995 by Stelios Haji-Ioannou who based the firm around the low-cost, no-frills model of the US flight operator ‘Southwest’. The concept of Easyjet is based on the fact that short flights within Europe are price elastic, meaning the lower the prices the more people will travel within Europe. The deregulation of the European airline industry in 1992 authorised any European airline to operate, fly and land anywhere within Europe. This allowed airlines to expand routes and operate within Europe with much higher precision. Easyjet was initially started from its ‘hanger’ headquarters at Luton airport with two Boeing 737-300’s offering flights from London Luton to Glasgow and Edinburgh at a price of  £29 each way. To date easyJet has now expanded into offering 125 routes from 39 major European airports using their fleet of 122 aeroplanes. EasyJet has also expanded into having large basis at not only Luton airport but also Liverpool, Geneva, and AmsterdamBack in 1999 easyJet gained free mass exposure to an audience of around 9 million viewers through ITV’s ‘fly on the wall’ documentary series ‘Airline’. The launch of easyjet.com in 1997 has become an integral part of the business model and has seen a huge change in the culture of booking travel tickets. Currently easyJet.com provides around 90% of bookings today and in 2001 hit ten million sales making it the second busiest travel website in the UK. Ryanair and easyJet are in fierce competition with each other as they are the two largest low-cost airlines operating within the UK. Since easyJet’s takeover of the low-cost airline â€Å"Go† in 2002 it has become Europe’s largest airline in this sector but still faces fierce competition. EasyJet Mission StatementA mission statement should be the ultimate goal of a firm and should filter down into every department of an organisation. To provide our customers with safe, good value, point-to-point air services. To effect and to offer a consistent and reliable product and fares appealing to leisure and business markets on a range of European routes. To achieve this we will develop our people and establish lasting relationships with our suppliers. (http://easyjet.com/EN/About/index.html)EasyJet’s environmental code based on three pointsTo be environmentally efficient in the airTo be environmentally efficient on the groundTo lead in shaping a greener future for aviation, for example:- carbon offsetting- shaping future aircraft design- for example, the ecoJeteasyJet high efficiency = lower emissions = low faresSWOT AnalysisA SWOT analysis analyses the internal Strengths and Weaknesses of easyJet along with the external Threats and Opportunities. Strengths†¢Well known, respected and memorable brand name†¢Strong and well known leadership figure in Stelios: â€Å"No Bullshit† approach†¢Motivated workforce independently trained at the easyJet academy†¢Very effective advertising strategies developed to reinforce the easyJet brand along with mass exposure through ITV’s ‘Airport’†¢Good knowledge of the market and effective responses to competitors attempting to steal potential customers†¢Fly to a large number of main holiday destinations†¢Lower carbon emissions due to using newer fleet of aircraft†¢Cost reduction with the removal of travel agents†¢High passenger volume†¢Low operating costs†¢Diversification into other markets, car rental, internet cafes and hotels†¢Flat managerial hierarchy, thus reducing costs†¢Innovator with regards to online booking and ticket-less travelWeaknesses†¢Fly only within Europe and no current intentions to expand outside of the continent†¢Rely on computer bookings to such extent that business would be unable to operate with computer failure or virus attack. †¢No customer retention/relationship policy. †¢No points scheme to reward frequent flyers†¢Access to European airports allowed by the deregulation of the industry, which may vary in the future†¢Outsources many of its services to third parties which may be damaging to its reputation†¢Success of Easyjet makes it difficult and expensive to train staff quickly enough. Opportunities†¢Lower costs further†¢Increase fares†¢Introduction of more countries into the European Union has increased potential customers and flight destinations†¢Expand into new routes, outside of Europe, and long haul†¢Decrease turn around times†¢Improve aircraft utilisation†¢Vertical integration to eliminate outsourced functions of easyJet’s procedure†¢Gain first mover advantage with regards to using alternative ‘greener’ fuel cells†¢Introduction of points scheme to reward and retain frequent flyersThreats†¢Rising fuel prices †¢Introduction of a carbon emission tax or other environmental regulations†¢New emerging competition†¢Competitors undercutting prices or offering similar prices for a more efficient/better service†¢Aircraft maintenance problems†¢Terrorism reducing air travel numbers†¢Emerging alternative modes of transport†¢Reputation lost in event of well publicised incident†¢DelaysPEST AnalysisA PEST analysis analyses the Political, Economic, Socio-Cultural and Technological factor influencing the low-cost airline industry. Political Factors†¢Threat of terrorism upon airlines†¢Governments applying taxes upon carbon emissions†¢Introduction of more countries into the European unionEconomic Factors†¢Increasing fuel costs and other environmental restrictions†¢European Union regulations†¢Prospect of higher security and insurance costs due to the increased risk of terrorism. †¢Continuing growth of air travel through continuing globalisation†¢Introduction of the Euro single currency is likely to integrate Europe even moreSocio-Cultural Factors†¢Travel and holidays are becoming more and more typical for a large percent of the UK  population†¢Continuing growth of multi-national enterprises has caused business travel to become more common†¢Gaining customers from France and Germany may cause problems as these nations are still very reluctant in using credit cards over the phone and on the internetTechnological Factors†¢Advancements in e-commerce resulting in increased online competition†¢Improvements in engine technology will allow easyJet’s planes to run more efficiently and reduce emissions†¢Increases in fuel technology offering easyJet alternative fuel sources Porter’s 5 forces model Porter’s 5 forces model looks at: the threat of substitutes, the threat of new entrants, the power of suppliers, the power of buyers and the rivalry among existing firms to analyse the competitiveness within a certain industry. The threat of substitutes†¢Fairly low threat from other modes of transport as the cost and time advantage clearly separates the low cost airlines from the luxury and comfort offered from substitutes such as high speed train services. For example London to Glasgow takes 6 hours on a train and costs around  £80 whereas Easyjet offers the service in 1 hour only costing  £29. †¢Regarding travel into mainland Europe the distance is far too great for train, car and ferry travel to be a realistic worthwhile substitute. For example if a customer was to drive to the south of France for a short weekend break the travel would take too long for it to be realistic and practical trip . The threat of new entrants†¢Limited capacity at suitable airports means any new airline would find it hard to find suitable take off and landing slots. †¢Huge start up capital required for the purchase of aircraft†¢New entrants would be working as a ‘loss leader’ for a number of years due to the large initial expenses†¢The low cost airline industry within the UK is fairly mature but as easyJet were one of the initial firms into this industry they hold a strong position. However within the rest of Europe there are many holiday operators who are attempting to enter the low cost airline industry themselves. The power of suppliers †¢The price of fuel is directly related to the cost of oil which is ever increasing. Easyjet rely on being able to obtain fuel but have no control over the price. †¢Aircraft manufactures are extremely concentrated within the industry with Boeing and Airbus the two main manufactures. The dependence of spare parts from a certain manufactures could pose a risk. †¢The more Easyjet expands the more power it will hold over its suppliers through gaining ‘economies of scale’. The power of buyers†¢Buyer power within the airline industry, especially the low cost sector is especially strong as customers often shop around and try to find the best price. This factor has been extended through the introduction of many online flight search engines such as travelsupermarket.com and lastminute.com. †¢The Civil aviation authority (CAA) provides protection against(1) the consequences of travel organisers failure for people who buy package holidays, charter flights and discounted scheduled air tickets and(2) licences airlines and ensures compliance with requirements of European and UK legislation relating to financial resources, liability and insurance of airlines. †¢Customers experience no negative feature of switching supplier so are happy to do so. Rivalry among existing firms†¢Ryan Air, BMI baby, MyTravelite, Jet2 and Buzz are all competitors with the UK low cost airline industry but Ryan Air is the only one of these to have succeeded and shown a continuously yearly profit. †¢British Airways and other traditional flight operators flying from the UK are competitors but on a much lower scare as they are targeting different market segments†¢There are over one hundred European based low cost airlines,  many of them are very small but still act as competition for easyJet. Different Types of competitorsSimilar specific – same product, technology and target marketSimilar general – Same product area but serving different segmentsDifferent specific – Same need satisfied by very different meansDifferent general – Competing for discretionary spend(Brassington, pg 866)In relation to Easyjet the similar specific competitors are the other ‘no-frills’ low cost airlines, operating within Europe. The largest firm that fits this specification is Ryan Air thus they are easyJet’s prime competitor. Other ‘no-frills’ low cost airlines operating within the UK include Jet2, bmibaby and Flybe. The similar general competitors are other airlines that operate within Europe but which are targeting a different type of clientele. Within the UK the largest operators are British Airways and Virgin but both of these operators tend to concentrate on the more upper class expensive business flights. They are also not in direct competition with Easyjet as they offer flights all over the world and are not restricted to just within Europe. The different specific competitors are firms which offer travel into Europe by means other than air travel. This would be the channel tunnel operator Euro tunnel and the English channel ferry operators such as P&O, Brittany or Stena Line. These are not in direct competition as the main differentiation is that on both the channel tunnel and the ferry crossing people can take their cars onboard. It is also a much longer process so unless visiting the west coast of France weekend breaks would seem rather pointless as the duration of the ferry would be too long. Different general competitors could be firms offering holidays and trips within the UK where no air travel is needed at all. Different general competitors could also be firms supplying other luxury items that may be bought instead of a holiday, such as a new car. Competitor analysisAs the range of competition throughout these groups (above), is at varying intensities the similar specific and similar general groups will be broken down into four segments for ease of analysis. Competition will be analysed through a competitor analysis. Who are our competitors?Segment 1Ryanair: Easyjet’s direct competitorsSegment 2Other UK based low-cost airlines: Jet2, flybe, bmibaby,Segment 3Standard UK based airlines: British Airways, Virgin Atlantic, KLM and BMISegment 4European based low-cost airlines: There are over 100 European low cost airlines such as: Condor, g’wings, SkyEurope and Blu Express. AssumptionsIt is inevitable that the continuous growth in the low cost airline industry will begin to slow down as the industry is becomes saturated. It is believed that the current mass of operators will be whittled down to a handful of major airlines. A large number of the smaller low cost airlines that will unavoidably struggle to compete will be involved in take-overs allowing the bigger players in the industry to continue to grow. What are our competitor’s strengths and weaknesses?RyanAir Strengths†¢Well known and respected brand name†¢Low costs due to low airport charges†¢High internet booking ratio†¢High aircraft utilisation†¢Use single type of aircraft†¢Fast turn around times†¢High seat densityRyanAir Weaknesses†¢Recent reports of poor customer service†¢Negative press†¢Airports are often long distance from travellers end destinationUK based low cost airline Strengths†¢All have their own website for bookings and ticket-less travel†¢Some have strong financial backing†¢Fast turnaround time†¢Low operating costsUK based low cost airline Weaknesses†¢Relatively small in comparison to easyJet and RyanAir†¢Large advertising costs†¢Small network of routes†¢Competing in competitive industry resulting in many mergers and take-overs†¢Restricted to the use of certain airportsStandard UK based airlines Strengths†¢Res pected and well known brand names †¢Worldwide service†¢Strong financial backing†¢Respected standard of serviceStandard UK based airlines Weaknesses†¢Low aircraft utilisation (compared to easyJet)†¢High costs†¢High pricesEuropean low-cost airline Strengths†¢Use of  single currency (Euro) can reduce costs†¢Closer to emerging markets (Eastern Europe)†¢Low costs†¢Well know brand names, in their respected home countriesEuropean low-cost airline Weaknesses†¢Relatively small compared to easyJet and RyanAir†¢Virtually unknown in the UK†¢Competing in fierce industry†¢Restricted use of certain airportsWhat are our competitor’s objectives?RyanAir – â€Å"RyanAir’s objective is to firmly establish itself as Europe’s leading low-fares scheduled passenger airline through continued improvements and expanded offerings of its low-fares service. RyanAir aims to offer low fares that generate increased passenger traffic while maintaining a continuous focus on cost-containment and operating efficiencies.† (Ryanair.com)UK based low cost airlines – Initially the UK based low cost airlines objectives are to survive in the industry by increasing their market share. The inevitable saturation of the market will cause many of the smaller low cost airlines to be merged or taken over by the larger players. In order to avoid this smaller low cost airlines need to differentiate themselves from the crowd or gain a unique selling point through lower costs, excellent customer services or exploiting new routes. Standard UK based airlines – Aim to continue their dominance of flights in and out of the UK by emphasising the quality of the service they provide. They also plan to reduce prices in order to shorten the gap between themselves and the low cost airlines. European bases low cost airlines – European low cost airlines need to survive in the market by increasing their market share. This could be established by increasing their network routes or branching into un-targeted countries within Europe. It is also plausible that mergers will occur within this sector to reduce the risk of failure. RecommendationsEasyJet can not avoid the increasing oil and petrol prices which is bound to effect the industry sooner rather than later. It may be recommended that easyJet start looking into using alternative renewable fuel sources. If easyJet can get hold of the technology to run their fleet of planes on a ‘greener’ fuel they may gain first mover advantage and capture large amounts of the competitions customers. Over the next three years it would be recommended that easyJet focus on ‘joining the dots’ of their European network rather than attempting long haul flights as this would be difficult and would carry a large initial risk. If easyJet could ‘join the dots’ in their European network it would fight off the competition from the emerging low cost airlines attempting to grow within the industry. Conclusion In conclusion easyJet have built a strong brand which has positioned them in an excellent spot within the low cost sector of the airline industry. With this sector of the industry predicted to grow, competition is likely to intensify even more but as easyJet has already built a strong brand and customer base it is unlikely they will be forced out of the market. EasyJet need to continue its advertising strategies, reinforcing its image and brand name to continue as one of the industries leading airlines. As the UK market is saturated and offers small or no growth opportunity, it would be logical for easyJet to focus on the expansion of their route networks within Eastern Europe. EasyJet should accomplish this through providing the routes themselves or merging with a competitor that already does. Reference List Bird’s eye view. SWOT analysis of low cost carrier industry (April 2007)http://www.air-scoop.com/downloads/SWOT_Low-Cost-Carriers_Air-Scoop.pdf [7-12-2007]Blythe, J (2006) Principles and Practice of Marketing, Thompson Learning, Bedford Row, LondonBrassington, F. Petit, S. (2003) Principles of Marketing, page Pearson Education, Harlow, EssexChannel 4 news. How green is easyJet? (May 2007) http://www.channel4.com/news/articles/society/environment/factcheck+how+green+is+easyjet/509642 [20-11-2007]Crawford,C. Easyjet SWOT Analysis (2004) http://www.marketingprofs.com/ea/qst_question.asp?qstID=3412 [25-11-2007]Hoffmann, J. Ryan Air – Environmental Analysis, Discussion of core competencies and Strategy Proposal (2004)http://www.grin.com/en/preview/39017.html [25-11-2007]Manzoor, M. Easyjet (2005) http://www.marketingprofs.com/ea/qst_question.asp?qstID=9339