Report on Westlands Investment PLC Production Relocation

This report provides a detailed analysis of the issues facing Westlands Investment PLC, focusing on the company's decision to relocate production from the UK to Romania. It examines the implications of this move, including the impact on shareholders, local and central governments, and the potential job losses. The report also addresses the corporate governance aspects, particularly the roles and responsibilities of executive and non-executive directors, and the regulations surrounding executive pay. The report emphasizes the importance of maintaining communication with shareholders, adhering to corporate governance codes, and ensuring effective decision-making within the company. It highlights the need for the company to balance its strategic goals with the interests of its stakeholders and the legal requirements.

Memorandum of Instructions

Executive Summary
This report is going to address several issues that are happening with Westlands Investment
PLC’s decision regarding moving their production from UK to Romania. In addition to that,
control of the board towards taking a decision regarding salary hiking of executives in
accordance with Corporate Governance Law is also constructed in this report. Lastly, role of
executive and non-executive directors has also been opposed in this report.

Table of Contents
Introduction.................................................................................................................................................4
Main Issues..................................................................................................................................................4
Conclusion...................................................................................................................................................4
Reference List..............................................................................................................................................6

Introduction
Westlands Investments PLC is facing issues from various areas and it is becoming essential for
the organization to manage their functions is such a manner so that they can sustain the business
for the future. In the present moment, it is becoming relevant for the organization to
understanding the manner the shareholders of the business should be connected and even should
be managed so that they can further shift their business outside EU. Within this memorandum,
the different issue will be discussed and the manner in which they can be overcome will even be
discussed.
Main Issues
Since shareholders are the most important component of an organization, they obtain the
potential to prevent Westlands Investments PLC’s production being shifted to Romania from
UK1. The local and central government will not be pleased by the decision alongside with
shareholders since almost 1500 people will lose their job due to this incident. Thus, it is possible
that local government will support that brief minority of shareholders, which might arise several
problems for the board2. Those shareholders may also propose to takes votes of other
shareholders and stakeholders regarding the situations. The board can offer shareholders to make
up a meeting for solving this issue.
According to the law of corporate governance code any UK company that have more than 250
UK employees in their organization structure have to publish a report annually that consist of the
reason behind the difference in between salaries of chief executives and other employees. In
addition to that, according to the governance code, the ration in between chief executive’s
payment and an employee’s monthly payment has to be maintained at any cost3. Thus, board can
1 'Duties, Responsibilities And Liabilities Of The Board Of Directors And The Board Of Commissioners Of
An Indonesian Limited Liability Company. - Corporate/Commercial Law - Indonesia' (Mondaq.com, 2018)
<http://www.mondaq.com/x/160710/Directors+Officers+Executives+Shareholders/
Duties+Responsibilities+and+Liabilities+of+the+Board+of+Directors+and+the+Board+of+Commissioners
+of+an+Indonesian+Limited+Liability+Company> accessed 4 May 2018
2 'What Are Directors’ Duties And What Can They Do To Protect Themselves In A Sale Of Company?'
(Startup Company Lawyer, 2018) <http://www.startupcompanylawyer.com/2008/05/15/what-are-directors-
duties-and-what-can-they-do-to-protect-themselves-in-a-sale-of-company/> accessed 16 January 2018
3 (Uk.practicallaw.thomsonreuters.com, 2018) <https://uk.practicallaw.thomsonreuters.com/5-613-3685?
transitionType=Default&contextData=(sc.Default)&firstPage=true&comp=pluk&bhcp=1> accessed 18
January 2018

increase the salary of chief executives by increasing the base salary of their employees. The
shareholders cannot prevent this under any circumstances.
As the non-executive directors are not connected to the business on a daily basis, it is becoming
essential for the business and the executive directors to make them aware about the existing
scenario of the business at regular interval4. It is essential for the non-executive directors to make
themselves updated with every financial movements that is happening within the business, so
that they can develop their policies and strategies accordingly, which will be beneficial for the
organization5. IT is essential to have proper hierarchy and flow of authority, with the help of
proper communication process, so that the decision-making is effective.
Conclusion
It is understood from the business that minority of the shareholders of the business may have
problems regarding the issue of shifting the production of the business outside their own
territory. It is essential for the business to understand that many lives are depending on their
workflow and it can even take a negative turn from the side of law. But at the same time, it is
essential for the business to understand the ways their employee base are retained, while keeping
in mind that the flow of authority is maintained within the non-executive directors. To sustain
the business, it is essential to retain their senior members of the management.
4 'Executive Pay | Corporate Governance' (Corporategovernanceoup.wordpress.com, 2018)
<https://corporategovernanceoup.wordpress.com/category/executive-pay/> accessed 5 May 2018
5 'The UK Corporate Governance Portal - Executive Pay' (Nortonrosefulbright.com, 2018)
<http://www.nortonrosefulbright.com/knowledge/technical-resources/the-uk-corporate-governance-
portal/executive-pay/> accessed 12 May 2018

Reference List
'Duties, Responsibilities And Liabilities Of The Board Of Directors And The Board Of Commissioners Of
An Indonesian Limited Liability Company. - Corporate/Commercial Law - Indonesia' (Mondaq.com, 2018)
<http://www.mondaq.com/x/160710/Directors+Officers+Executives+Shareholders/
Duties+Responsibilities+and+Liabilities+of+the+Board+of+Directors+and+the+Board+of+Commissioners
+of+an+Indonesian+Limited+Liability+Company> accessed 4 May 2018
'What Are Directors’ Duties And What Can They Do To Protect Themselves In A Sale Of Company?'
(Startup Company Lawyer, 2018) <http://www.startupcompanylawyer.com/2008/05/15/what-are-directors-
duties-and-what-can-they-do-to-protect-themselves-in-a-sale-of-company/> accessed 16 January 2018
(Uk.practicallaw.thomsonreuters.com, 2018) <https://uk.practicallaw.thomsonreuters.com/5-613-3685?
transitionType=Default&contextData=(sc.Default)&firstPage=true&comp=pluk&bhcp=1> accessed 18
January 2018
'Executive Pay | Corporate Governance' (Corporategovernanceoup.wordpress.com, 2018)
<https://corporategovernanceoup.wordpress.com/category/executive-pay/> accessed 5 May 2018
'The UK Corporate Governance Portal - Executive Pay' (Nortonrosefulbright.com, 2018)
<http://www.nortonrosefulbright.com/knowledge/technical-resources/the-uk-corporate-governance-
portal/executive-pay/> accessed 12 May 2018