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Corporate Governance
Introduction to Embraer Motivation Challenges and Solution Devising their Corporate Governance Rewards Embraer Today
INTRODUCTION
Embraer is an aircraft manufacturer based in Sao Jose dos Campos, Brazil.
INTRODUCTION
Since privatization, it has become one of the largest aircraft manufacturers in the world. It provides a superior product package and after-sales support for parts, services, and technical assistance. It has 5 plants in Brazil. Distribution centers are in China, Singapore, United States, France, and Portugal.
MOTIVATION
Privatization
Main Solution:
Making its own corporate governance, rules, and practices.
Challenge:
Embraers capital structure was limited by the Brazilian Corporate Law in terms of the distribution between the common and preferred shares -It limited the access to the capital markets -It restrained the liquidity of the companys shares
REWARDS FOR PUTTING IN PLACE BETTER CORPORATE GOVERNANCE, RULES, AND PRACTICE
Net sales increased by 11.3% from 2004 to 2005 reaching US$ 3.829 billion- the highest ever recorded in companys history. Net income increased by 17.2% from 2004 to 2005 reaching US$ 445.7 million. Generated significant wealth to investors. Embraer became the first place in the Best Buy-Side Investor relations Survey in 2005, awarded by the Institutional Investor Research Group.
REWARDS FOR PUTTING IN PLACE BETTER CORPORATE GOVERNANCE, RULES, AND PRACTICE
Market has recognized Embraers transparency standards as exceptional. Recognized for having emphasis on high social and environmental standards.
EMBRAER TODAY
Embraer believes that having high levels of corporate governance is a journey, not a destination. Embraer is currently undergoing a transition period from being a company with defined ownership to having dispersed shareholding. The company is committed to making the necessary adjustments to meet the new market demands. With the highest standards of corporate governance and transparency, Embraer hopes to stay an investor-friendly company for years to come.
By: Marnelle Rose Lopez Rizalino Difuntorum Kim Mikah Go Jelyn Satimbre
BSAcc 4-1
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