FINAL EXAM:

BUSINESS ETHICS,
LAW AND
SUSTAINABILITY
SYNDICATES 2
TEAM MEMBERS

Claudhia Devita
Astie Asty Aprilia Putri Dias
Kurniati Firdausya Kusuma Saraswati Natrasuari
NIM: NIM: NIM: NIM: NIM:
29322439 29322474 29322464 29322492 29322493

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ASSIGNMENT 1
A. According to the Lazada Terms &
Conditions, when is the contract of sale
is formed and when does it become
binding to Lazada’s User?
B. If a customer disputes the sale conducted
through Lazada, what are the options for
the customer to resolve the dispute?

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According to the Lazada Terms & Conditions, when is

the contract of sale is formed and when does it become
binding to Lazada’s User?
As stated on the Article 2.6 Reservation of Rights in Respect of Order:

“...Unless you receive a notice from Lazada confirming your order, Seller shall not be party to any legally
binding agreements or promises made between Seller and you for the sale or other dealings with Product(s)..”

Therefore, the contract of sales is formed and becomes legally binding to Lazada’s users at the time that the
seller accepts the customer order and when the buyer receives a notice from Lazada confirming the order.

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If a customer disputes the sale conducted through Lazada,

what are the options for the customer to resolve the dispute?

According to the Terms and Conditions of sales, Article No. 11.9 Governing Law:

The customer have two available options to resolve the dispute:

1. ADR Proceeding: both parties should first attempt to resolve the dispute in an amicable manner or through
Alternative Dispute Resolutions, common ADR processes include mediation, conciliation, expert
determination, dispute board, or adjudication.
2. Arbitration: if within 14 days after failure of the settlement negotiations, each Party may initiate an
arbitration proceeding in accordance with the rules of the Philippines Dispute Resolution Center (“PDRCI”).

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ASSIGNMENT 2
What does “good corporate governance” mean
to you?

If you had the chance to improve the good

corporate governance and/or anti corruption
measures in your
current/former company/workplace, what
measures would you take?

Please state the current condition and how you

would alter them (choose any company of any
of your group member).

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WHAT’S GOOD CORPORATE GOVERNANCE

In terms of definition: Means of Good Corporate Governance

“Corporate governance is a Both of definitions explain that corporate governance is a system. Good corporate governance
system of authoritative means that good system that lead to business performs well.
direction, or government.“
Characteristics of successful corporations: Good corporate governance is important it affects
Source: Colley, John. L. What Is Corporate ● Effective BoD
Governance? McGraw Hill Professional, 2004. ● Competent CEO
positively for all stakeholders and also shareholders.
● Selected “good business” means that Imagine all these characteristics applied to the
business able to effectively and corporate and it will beneficial in the long run.
Another definition: profitably
● Have a valid business concept
“Corporate governance is the
● Appropriate implementation of business As for individual especially as a worker, working in
concept
system of rules, practices and ●
company that have good corporate governance
Organization ‘s obligations met with
processes by which a company integrity and in compliance become more ease in heart because it terms of
is directed and controlled.“ ● Full and timely disclosure the business is more stable while it also avoid us to
performance to the business owner and
investment community involve in any business risks.
Source: What Is Corporate Governance?
https://www.cgi.org.uk/about-us/policy/what-is- Source: Colley, John. L. What Is Corporate Governance? McGraw
corporate-governance. Hill Professional, 2004.

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CORPORATE GOVERNANCE IN GROUP M

Introduction Current Condition
GroupM is a part of Before mention what is current condition in Group M in terms of
WPP. WPP is a creative corporate governance. Here’re 4 core principles regarding Corporate
transformation company. Governance:
As a parent company,
WPP supporting and able to account for and explain every action and
providing in many Accountability decision taken and are obligated to take ownership of
the risks involved.
aspects to all subsidiaries
for example regulations, Transparency
openness and willingness to disclose truthful,
accurate and timely
mandatory trainings for
compliance to all strives for good business ethics.
Fairness
employees and more.
Responsibility the board to wield their power responsibly.

Source: Díaz, David. “What Are the Core Principles of Corporate Governance?” University of Lincoln, 16 June 2022,
Source:https://www.wpp.com/contacts#tab- https://online.lincoln.ac.uk/what-are-the-core-principles-of-corporate-governance/.
companies

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CORPORATE GOVERNANCE IN GROUP M

Current Condition Example : Tools for Transparency

→ In Group M along with WPP are made many tools that GLOBAL Radar benchmarking Tools are made of clients have
accessible not only internally and clients.
Global Radar is a benchmarking same rights (receive same
→ WPP declared to always commit about corporate governance, tool to track Brand Safety treatments, to be well informed
performance for client and
it will applicable to the Group M too. about their performance and
publishers. Tracking is provided for
Invalid Traffic, Viewability, In-geo business). Tools didn’t impact to
→ Employees require to do mandatory trainings that related with delivery, and contextual conflict of interests between
misalignment.
compliances like How You Behave, Belonging at WPP, Process clients.
Excellence, etc and it’s support the corporate governance.
Excellence program Tools are made as helicopter views
→ There are several mandatory procedure that needs to be done Covering Search, Social,
for brand safety that avoid any
to achieve complience in many aspects. For example how the Programmatic all GroupM clients fraud or misalignment that might
Purchase Orders policies and it’s impementation. have their campaigns set up to meet encountered within selected
the highest levels of standardized
best practices.
platforms or publishers.

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CORPORATE GOVERNANCE IN GROUP M

If had a chance to improve
In terms of current condition of corporate governance seems that GroupM is
doing good in 4 principles stated previously : Accountability, Transparency,
Fairness, and Responsibility.

If had a chance to improve: Accountability

Since in many situations, where employee need to complete many trainings

about policies and complience that required by managements specifically
higher management while in actual event it might be different, eventhough it’s
good as our fundamentals.

How it measure: Currently focus with how many employee that completed
the trainings. Now it should be actual score. Like board, like if any non
compliance occur the score become zero.
Source: WPP Policy Booklet

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 ASSIGNMENT 3
You are the President Director of a limited liability company in Indonesia. Your company is in the
middle of a major property development project where you have sold 60% of the property before
any construction even begins. The General Meeting of Shareholders passed a resolution that the
company should adhere to strict anti corruption guidelines, following the anti-corruption laws of
Indonesia. Your shareholders also expect profit to rise.

A.The project has been delayed because of problems in land acquisition. The land officer will not
conduct their measurements despite all the documents you have given to fulfill the terms for a
measurement. Your deadline to finish land acquisition is nearing or otherwise the project will be
late. You heard from your notary that the usual practice is to pay for extra, non-regulated
expenses for the land officers to get the measurements done and expedite the process. What will
you do? If you have any alternative actions, please explain.

B.If you decide to pay the extra-expenses on the company's budget, does the shareholder have any
recourse against you personally (civilly and criminally)? Consider the articles of Company Law
No. 40/2007.

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A. Plan to solve delayed problem on land acquisition

As the Director of the company, we decide to take an alternative action which is we will ask the notary to help and hold the
responsibility to handle the land acquisition process as well as the consolidation of this land. Under condition where the company has an
option to pay extra-expenses to speed up the land acquisition process, we will pay the extra-expenses through the notary, as it is
her/his responsibility to assure the land acquisition to be finished on time.

The extra-expenses for land acquisition will be submitted and allocated as the “notary fee”. Furthermore, this cost will be charged and
will be stated (written) to the notary fee in the company’s budget. Hence, the company does not directly pay the extra-expenses that are
not regulated to the land officer or other related parties.

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B. If We Decide to Pay the Extra-expenses

If we decide to pay the extra-expenses, we will have 3 conditions, which are :
A. Extra-expenses paid out directly by Director / Management to the Land Officer for company’s interest

If the Director decide to pay the extra-expenses to the land officer directly without using the alternative stated in the answer A (through the
notary), then the company can be prosecuted for violating the law which is corruption crime.

In this case, even though the extra-expenses paid by Director and for the company’s interest to accelerating the land acquisition process to
support the company’s project, it still categorized as corruption. The Corruption Law states that a corporation is an organized collection of
people and/or wealth, weather it is a legal entity or not.
Article 20 of the Corruption Law basically states that if corruption is committed by or on behalf of a corporation, criminal prosecution or
imposition can be made against the corporation and or its management. The principal sentence that can be imposed on a corporation is only a
fine with a maximum sentence plus one-third.

The process of providing a deterrent effect for corporations will also be very effective if the perpetrators are cumulatively charged not only
with the Corruption Law, but also with the Money Laundering Law. In Article 7 of the Money Laundering Law, it is stated that the main
punishment imposed on corporations is a maximum fine of Rp. 100 billion.

In addition to fines, additional penalties can be imposed in the form of freezing part or all of corporate business activities, revocation of
business licenses, dissolution and/or banning of corporations, confiscation of corporate assets for the state and/or takeover of corporations by
the state.

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B. If We Decide to Pay the Extra-expenses

B. Extra-expenses paid out directly by Director / Management to the Land Officer for the Director’s Interest
In case that the director / management pay the extra-expenses directly to the land officer to gain personal interest, then for the director’s
action, the director can be punished personally (Piercing of the Corporate Veil). Piercing of the Corporate Veil is a doctrine that makes
exceptions to a general principle, where the responsibility of the company management are unlimited. Based on the principle of Piercing of
the Corporate Veil, then it can be applied to the director who intentionally make mistake that cause losses to the company to gain personal
interest. In practice, the director, in carrying out their duties, can not receive benefit only for themselves but must prioritized the company’s
interests
The criteria for the action of the Directors as Piercing the Corporate Veil are as follows:
● The requirements of the Company as a legal entity have not been or have not been fulfilled
Based on Article 14 paragraph (1) UUPT, in the event that the requirements for a company as a legal entity have not been or have not
been fulfilled, then all members of the board of directors together with all founders of the PT and all members of the Company's Board
of Commissioners jointly and severally responsible for the legal actions taken by the company.
● The Board of Directors violates the Ultra vires principle
Article 92 paragraph (2) of the Company Law which explains that:
The Board of Directors has the authority to carry out the management as referred to in paragraph (1) in accordance with the policies
deemed appropriate, within the limits specified in this Law and/or the articles of association. In simple terms, it can be concluded that
ultra vires are the actions of the Board of Directors outside the aims and objectives and business activities of the Company specified in
the AD, including taking actions outside the aims and objectives of the company, actions taken for personal interests, and actions taken
under beyond the authority given to him based on the provisions in force.

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Cont.
● Directors violate the principle of fiduciary duty
In the event that the board of directors violates the principle of carrying out their duties in good faith and with full responsibility for
the interests and business of the Company (fiduciary duty), then each member of the Board of Directors of the company is
responsible up to his personal wealth.
The principle of fiduciary duty also applies in the event of bankruptcy of the company. This is regulated in Article 104 paragraph
(2) UUPT which states that, if bankruptcy occurs due to the negligence or mistakes of the directors and the Company's assets are not
sufficient to cover losses due to the bankruptcy, the members of the Board of Directors are jointly and severally responsible for the
loss.

In addition, Article 97 paragraph (6) of the Limited Liability Company Law states that "On behalf of the Company, shareholders
representing at least 1/10 (one tenth) of the total shares with voting rights may file a lawsuit through a district court against members of
the Board of Directors who because mistakes or negligence cause losses to the Company.” This article proves that in the case that
occurred, if I, as the main director/management, make payments directly to land officials for personal gain, then the shareholders can
make claims against me and I can be held accountable indefinitely (involving personal property).

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B. If We Decide to Pay the Extra-expenses

C. Extra-expenses paid out as “notary fee”(as stated in answer A)

If the director / management of the company pay the extra-expenses by allocating them as a "notary fee", then the
shareholders have no loopholes in suing the director because the company has sold 60% of the property where the company
has legal responsibility for the completion of projects that have been purchased by the customer. Furthermore, related
additional costs incurred have been allocated as "notary fees" so that they will not be recorded as "expenses outside the
applicable provisions".

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