Corporate Governance & Ethics in Mittal Steel (ArcelorMittal)

Running head: CORPORATE GOVERNANCE & ETHICS
CORPORATE GOVERNANCE & ETHICS
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CORPORATE GOVERNANCE & ETHICS1
Question 1
Corporate Governance is recognized as set of systems, procedures and principles, which
guarantee that organization is governed in most effective interests of all stakeholders (Ferrary
2019). Corporate governance offers well-organized structure, which functions for betterment of
every individual concerned by ensuring that the enterprise aligns with ethical and moral
standards laws and recognized practices. It further entails basic business ethics and principles,
which are essential to be adhered to in actions and spirits. Steel industries in recent times have
been placing utmost importance on proper governance of the company and specifically shed light
on executing prudent risk-taking actions, which attain balance between generations of rewards
for stakeholders who invest their capital. Along with the provision of effective employment for
staffs in an approach that will contribute to the benefit of community (Friedmanet al. 2016).
Mittal Steel Company, one of the world’s major steel manufacturers by volume as well as in
revenues has designed its corporate governance framework in order to address all of these issues,
which will elevate the input of the Board and management to the accomplishment of the
business. The following report will evaluate Corporate Social Governance and Ethics of Mittal
Steel (Currently owned by ArcelorMittal) and the way its actions and performances contribute to
welfare of the community.
ArcelorMittal places significant emphasis on good corporate governance by guaranteeing
cultural pattern of compliance along with sensible management of business threats along with
utmost integrity (Arcelormittal 2019). Furthermore, ArcelorMittal has been efficiently exhibiting
responsibility and respect for its employees along with all stakeholders. The company has been
actively listening and acting responsive to their concerns, which are considered core of the

CORPORATE GOVERNANCE & ETHICS2
business. ArcelorMittal operating as public limited liability company incorporated in
Luxembourg is primarily governed by board of directors based on the requirements mentioned in
company’s article of association. Reports have revealed that board of directors are primarily in
responsibility of overall authority as well as direction of ArcelorMittal (González Begega,
Köhler and Aranea 2018). Role of independent directors and other directors lie on implementing
organizational strategy, overall management of the business in addition to all operative decisions
have been delegated to the CEO Office, which constitutes of chief executive officers, Mr.
Lakhsmi N. Mittal along with Chief Financial Officer (CFO), Mr. Aditya Mittal and supported
As per reports, ArcelorMittal obeys the 10 Principles of Corporate Governance of the
Luxembourg Stock Exchange in all dynamics. The board of directors have revealed that Mr.
Mittal’s tactical vision for the steel industry in common as well as for ArcelorMittal specifically
in his role as CEO has been identified as key asset to the company (Arcelormittal 2019).
Although, as per reports, he is completely affiliated with stakeholders’ welfare, Mr. Mittal has
been specifically positioned in order to direct the board of directors in his role as chairperson.
Moreover, the combination of these roles have been restructured by ArcelorMittal’s Annual
General Meeting of shareholders recently, when Mr. Lakshmi Mittal has been re-elected to the
panel of directors for next three year period by a robust preponderance (Arcelormittal 2019).
Separation of ownership and management in corporate governance involves positioning
the organizational management under the accountability of experts who are not recognized as its
owners. According to González Begega, Köhler and Aranea (2018), organizational development
comes with demands for various skills and capacities to manage the organization. Reports of
Yoo (2019) have revealed that ArcelorMittal has been exploring the potential of acquiring of
Uttam Galva and further recovering the value in KSS Petron after their payments in order to gain