Case Study: Board architecture at Arcelor Mittal
In 2006, the merger related to the steel makers named Arcelor and Mittal produced the largest steel company in the entire world, with total 330,000 employees as well as forecast the earnings of approximately $ 15.6 billion. Arcelor, the steel maker has fought the longest defensive battle in contradiction of the hostile takeover that valued at approximately $ 34 billion. He was incorporated in the location named Luxembourg and also had adopted the architecture of European governance, with the help of supervisory board that also involve the representatives of the employee and the management board.
The company named as Mittal was mainly a family company with the tradition about the growth through the acquisition. In this, the founding family have still played a vital and a dominant role. Here, Arcelor had been criticized Mittal mainly for the inadequate controls as many members of Mittal family and some of the independent directors on its board.
In the merged company of Arcelor Mittal (Arcelor Mittal Company), the Mittal family has retained up to 43.5 percent from the voting equity. The innovative boards were approximately 18 % strong, with the chairman named as Joseph Kinch. Here, Joseph Kinch was working as a chairman of Arcelor previously and Lakshmi Mittal was a president. There were total nine independent directors along with the employee representative directors and the nominee directors for reflecting the interests related to the significant shareholders.
Along with this, the General Management Board was also chaired by the Roland Junck, who was a CEO of the company, with the son of Lakshmi Mittal, Aditya Mittal was worked as CFO.
In the assessment, it must assess the post-merger board structure and also discuss the advantages and disadvantages before reading the article of Financial Times. Along with this, it must read the article of Financial Times. Apart from this, the negative and positive impacts on the effectiveness regarding the Mittal Steel Board after reading the particular article as well as compare the effectiveness and appropriateness mainly with the post-merger board.
This overall assignment and questions given in this are based in the article of Financial Times i.e. ‘Governance may impede Mittal’s pursuit of Arcelor’. Students have to read the article and the case study given in the assignment in very appropriate manner before start working on it. There are three different questions given in the assignment, which should be answered individually so that it can be easy to express all the points by the students in clear and concise manner. For this assignment, Harvard reference style need to be used as per the instructions given in the assignment by professor. All the arguments, which are to be given by the students should be based on the tools and concepts described in all the topics.
As per the instructions and specifications given in the assignment, all the students are required to submit their assignments through ACC03043 SCU Blackboard learning site. They must also utilize the link of Turnitin Assignment. The assignment should be made as per the marking rubric only.