Wange Limited is a Zambian company involved in the extractive industry where it exploits gemstones and forest timber which are exported to different countries. An investment licence has been secured after approval as Wange assured the government of a significant FDI investment to the tune of US$ 3.5 billion that is expected to create over 10,000 jobs for the local nationals. Wange is the main shareholder with 80% stake and government holds the remaining 20% in the company. The directors recently removed the managing director for publicly accepting liability for polluting a water source that affected 80 villages in the area. The boards view was that the company should not be blamed for the villagers own negligence when they had been told to relocate to another area but refused. As a consequence a public pressure group has accused the government for not taking action against the company because the company had made a political donation to the ruling partys candidate during local campaigns.

In its 6 years of operations the company has had a bad record with labour officers who sited management for breaching labour laws as workers were not given adequate protective clothing. Further workers were replaced if they got sick and did not report for work after two days. Recently the company began excavating an area located in forest reserve that Water Resource Management Authority (WARMA) had designated as a water catchment area, news that the public was not happy with. The board has defended this position saying the company was given the rights to operate in the concession area. This has led to wide spread uproar among concerned stakeholders stating that the companys board and corporate governance system is questionable judging by the decisions being made. In recent years the roles and responsibilities of organizational Boards is increasingly being scrutinized by various stakeholders. Among the many expectations from stakeholders is the effectiveness of the board through composition of members, integrity and ethical values of board members and ability to critically analyze the companys mission and long term strategic objectives such as wealth maximization, extent of corporate governance standing and corporate social responsibility. As a consultant address the issues that follow:

1. Discuss and critique the function of the board of directors at Wange in line with the companys operations as outlined in the case above. (10 Marks)

ii As a management expert suggest how the effectiveness of the board could be improved at Wange. (15Marks)