Corporate Administration: Precedence and Drawbacks of the Board Structure after the Arcelor-Mittal Merger

Running Head: LAW
CORPORATE ADMINISTRATION
Name of the Student
Name of the University
Author’s Note

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Answer 1:
According to Zarin and Yang, 2011, the documentation deals with the subject subject
matter of amalgamation of the two organizations Arcelor and Mittal in the year 2006. Arcelor
Mittal is the descendent of Mittal Steel, a trading agency that was established in the year 1976 by
Mr. Lakshmi N Mittal. The Arcelor Mittal was assimilated and acknowledged in the year 2006
by the virtue of amalgamation of the two separate organizations called the Arcelor and Mittal. It
was a pugnacious assimilation by the Mittals, which however, developed into the world's biggest
steel plant. Mittal earlier composed a unitary form of Board of Directors. Unitary form of Board
of Directors means that the absolute presidency of the organization is carried out by a single
frame (O'Boyle and Shilbury 2016). There is no emergence of disparate administration board.
Unitary Board is made of following types: a board of directors, a board formed with
predominance of non-executive directors. On the contrary, Arcelor was formed in Luxembourg
with two tier board frame. The two-tier board frame is the kind of frame, which has two ancillary
boards called the management board and the supervisory board. It is formed by the two directors
of the board each on the ancillary board. This type of framework is called the dual board
structure. The two ancillary in a two-tier board toil singly of each other (Block and Gerstner
2016).
After the assimilation of Arcelor and Mittal, the new organization named as the
ArcelorMittal is formed of a new team of Board of Directors with 18 members, with all the
eighteen being non-executive. Out of such Board of Directors, predominance of them are solo
and singly. In the newly formed organization, the Mittal family however reserved 43% of the
total voting rights. It is formed as the Public Limited Responsibility and accountability
Corporation administered by its board of directors as the judgment making chief. The board of

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Directors are working in corcordant with the provisions professed in the articles of association of
the organization (McLaughlin 2018). The new team of directors of the Board comprised of six
directors from Arcelor, six from Mittal and three spokesperson of existing Arcelor share-holders
and three employee spokesperson. Predominance of the board of directors is non-executive.
From the above study, it can be interpreted that the newly designed board of directors is a
sample of unitary board of directors, comprising predominance of non-executive directors. This
group of Board is unconventional originating in the public organizations, which are listed, but
are predominantly shine in the excellence of non-commercial association counting those trading
with sports, trusts, charity, health sectors and others. The frame of the Board details the
predominance of Mittals in the judgment-making processes in the organization’s administration.
The unitary board of directors has only single administration or judgment-making body.
Thus, such disposition has its possess convenience as juxtaposed to the replica of the two-tier
body. Firstly, since the replica has a unitary body, it possesss certain convenience of solo
potency of the administrative system without any juxtapose of outlooks. Therefore, the judgment
can be taken effortlessly and in the flow of speedy judgment making. Also, that the judgment
would be single minded liberal from ambiguity. Secondly, the flow of transmission of
information would be constructive and one way. Therefore, no assent is required from one board
to the other (Saeed and Saeed 2018). Better transmission of information techniques lead to better
working environment and constructive among the people. Thirdly, the benefit of the replica
broadens its support to the directors who are absolutely elaborated in the process of judgment
making and its connected conversations. The directors who are non-executive also accord their
propositions to the ones who are executives. Fourthly, as a unitary form of judgment making