The merger of steel makers Arcelor and Mittal in 2006 produced the world's largest steel

company, with 330,000 employees and forecast earnings of US$15.6 billion. Arcelor had

fought a long defensive battle against the hostile takeover, valued at around US$35 billion.

Arcelor was incorporated in Luxembourg and had adopted European governance

architecture, with a supervisory board, including employee representatives, and a

management board.

Mittal was a family company with a tradition of growth through acquisition, in which the

founding family still played the dominant role. Arcelor had criticized Mittal for its inadequate

controls, because it had many Mittal family members and few independent directors on its

board.

In the merged Arcelor Mittal company the Mittal family retained 43.5 percent of the voting

equity. The new board was eighteen strong, with chairman Joseph Kinsch, who was

previously chairman of Arcelor, president Lakshmi Mittal, nine independent directors, plus

employee representative directors and nominee directors to reflect the interests of significant

shareholders.

The General Management Board was chaired by the CEO Roland Junck, with the son of

Lakshmi Mittal, Aditya Mittal as CFO.

What is your opinion of this board structure?