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Board Meeting Exercise Introduction 1 Board Meeting


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Board Meeting Exercise Introduction 1 Board Meeting

  1. 1. 1 Board Meeting Exercise Introduction Content This document contains two exercises based on a realistic scenario in which a company intends to set up an overseas operation. The first of these exercises relates to advice on the legal aspects of the company’s intended project. The second is a board meeting, in which the participants take the roles of different company directors, debate the relevant issues and finally cast votes on the items on the agenda. Further assistance Please do not hesitate to contact the author of this exercise, Rupert Haigh, by email ( if you require further assistance or information. You may also wish to visit our online Legal English Store at for further legal English products. 1 Board Meeting & Legal Advice 1.1 Giving business law advice 1.1.1 Background Peter Jones, an English solicitor, has contacted your firm. Mr. Jones has contacted your firm because he has an English client, Colin Burns, who wishes to set up in business with one business partner in your country. The nature of the business is the research, development and manufacture of a new medical treatment which is said to be able to cure the common cold. The situation is that a researcher working in the R & D department of the client’s existing business in the UK has discovered a technique which prevents the viruses which cause colds from establishing themselves in the human body. The next step is to separate this issue from the core UK business and to develop a product based on this discovery. Mr. Burns wants to set this business up in your country partly in order to keep it separate from his core business, and partly to take advantage of the excellent medical research expertise available in your country. The client wants advice about the different business formats (partnerships, companies etc) available under the law of your country. As far as Mr. Jones is aware the business established in your country will at a day-to-day level function separately from his client’s UK business. However, it may in fact operate as some kind of subsidiary of the UK business, which is a private limited company known as RemCureCo which specialises in the production and sale of analgesic medicines. Mr. Burns is the MD of this company. The client wants the freedom to take on employees and would prefer a corporate structure but does not want to get bogged down by formalities at this stage.
  2. 2. 2 1.1.2 Task Advise Mr. Jones over the telephone or in a meeting, and then write a letter to him confirming the advice you gave. The aim is to accurately explain your country’s law, but using English terms that Mr. Jones will understand. Your advice should cover the following issues: 1) Business formats; 2) Intellectual property law; 3) Employment law; 4) Financing. 1.2 Board meeting 1.2.1 Instructions for exercise This exercise is suitable for four to six participants. The scenario is a meeting of the directors of RemCureCo. On the agenda is the question of the new enterprise to be established abroad. The participants in the meeting are as follows: • Peter Jones, RemCureCo’s solicitor. Mr. Jones is present at the meeting in his professional capacity, and will not participate in the debate over the issues or cast a vote. His role is to advise the directors on the relevant legal issues. He will give a presentation in which he will set out the advice he has been given by the foreign lawyer to whom he spoke (see above). The directors should be prepared to ask Peter Jones questions on any aspects of the presentation which are unclear or require further elaboration. • Colin Burns – Managing Director. See profile below. • Wendy Gray – Director. See profile below. • Larry Anderson – Director. See profile below. • Gillian Donaldson – Director. See profile below. If there are only four participants, the role of Peter Jones can be omitted. If there are six participants, a separate character can be included to chair the meeting. The other participants will take the roles of the company’s directors. The chair will open the meeting and introduce the agenda. As to the minutes of the last meeting, for the sake of convenience all parties may agree that they have received and read them and have no questions. The agenda will consist of the following: 1) Should the foreign project go ahead at all? 2) If it does, what corporate structure will the foreign business have? 3) What will its name be?
  3. 3. 3 4) In what way will the foreign company be formally linked with the British concern? 5) What will the foreign business’ recruitment policy be? Will it seek to recruit from the UK or from the country in which the business is located? 6) How will the foreign business be financed? 7) AOB. The participants should discuss these issues thoroughly. The role of the chair is to control and structure the meeting. By the end of the meeting, the issues should be presented as motions and votes should be taken. The chairman will have the casting vote. Minutes should then be drafted recording what occurred at the meeting. Before commencing the exercise, read the notes on RemCureCo set out below. 1.2.2. Notes on RemCureCo Overview The structure of the business is that there are four directors – Mr. Burns, Mrs Gray, Ms. Donaldson and Mr. Anderson. The business employs 30 staff. Of these, three carry out administrative tasks, ten are in sales under the supervision of a sales manager, there are seven full-time research and development staff, and the remainder are involved in the manufacture and distribution of products. All the staff work from a single site in Reading, UK. The business develops, makes and sells a variety of analgesic products which are sold to supermarkets and chemists mainly in the UK and in the Republic of Ireland. The company’s most successful lines include ‘BitesEaze’, an ointment which very effectively relieves pain caused by insect bites, and ‘ClearNose’ which relieves the blocked nose symptoms associated with colds. At the moment the company is doing very well and its profits have risen over 25% in the last two years. This is largely due to the bankruptcy three years ago of one of its main competitors WellWellWell Ltd. RemCureCo was established as a limited company in 1990 by Colin Burns. Characters Colin Burns is 53, a flamboyant entrepreneur and shrewd judge of business opportunity. He is a clever and aggressive businessman. He does not have the technical background which would be useful in the pharmaceutical area in which his company operates, but he relies upon his ability to select good staff with the expertise which he lacks. He tends however to regard RemCureCo as ‘his’ business and the other directors sometimes have to assert themselves quite forcefully to get past this mental block. His approach is ‘broad brush’ – he has a general grasp of all the company activities but is not heavily involved in any of them.
  4. 4. 4 Wendy Gray, 42, has been with the firm for 10 years, having initially been recruited by Colin Burns to head the R&D section. She still focuses most of her attention on the research side of things. She is a superb scientist and has been personally involved in much of the research that has led to many of the company’s most successful products. In general business terms her skills are more limited, although she is a very capable manager. However, she has become used to deferring to Colin on most non-technical matters. Nonetheless, without her technical input the firm would be in difficulties. She secretly wonders whether there is any real merit in the foreign business idea – the new project could, at least from a scientific point of view, be just as well handled in-house in the UK. Wendy has the respect of everyone in the firm – she does not say much, but when she talks, everyone listens. Larry Anderson, 55, joined the firm in 2001. His background is in sales and he is a self-styled ‘sales guru’. He has the reputation of being a great ideas person and a brilliant talker. He is a natural at motivating and inspiring people and selling ideas to them. He is not so good at following his ideas through and tends to try to delegate the hard work to others. He grasps the value of the new project and is very enthusiastic about it. He has a good relationship with Wendy Gray and Gillian Donaldson but there is sometimes friction between him and Colin Burns who sometimes feels threatened by Larry’s undoubted brilliance and exasperated by his inability to get things done. Gillian Donaldson, 31, is a business school graduate. She holds an MBA and has established a reputation as a highly effective business administrator. She is energetic and ambitious and has an uncanny knack of being able to predict with almost unfailing accuracy the kinds of products which the public are most likely to be interested in buying. She does not have a technical background but unlike Mrs. Gray she will disagree with Mr. Burns when she believes that he has got it wrong. She has noted that Colin tends to be over-ambitious as to what the firm can achieve on occasion. Therefore, whilst she sees that the foreign project has considerable potential, she is concerned that it is handled carefully. It would be all too easy in her view for a lot of money to be wasted on the project without any tangible results. Gillian has a strong analytical mind and knows how to put her point across without alienating anyone. She is still in the process of cementing her position in the company however, having only joined it a year before.