Online course - Practical governance for subsidiary companies
2 Sessions of 3 hours each
A subsidiary has, by definition, one shareholder which holds sufficient rights to nominate, directly or indirectly, a majority of the Board of Directors. By extension, this same shareholder can nominate the management of the subsidiary. The major shareholder therefore has bearing on all major decisions pertaining to the subsidiary.
The major shareholder is typically the largest investor in the subsidiary and therefore the most exposed to its risks. However, such a shareholder often sees corporate governance as an obstacle to the integration of the subsidiary’s activities within its group.
A Director of a subsidiary often sees his role reduced to a simple rubber stamp of decisions taken at the shareholder level, or face being removed from the subsidiary Board by the latter.
This workshop identifies the legal responsibilities and obligations of a Director of a subsidiary and how to constructively manage the conflicts arising with the interests of the major shareholder. It also identifies the advantages to the major shareholder of good corporate governance at the subsidiary level as well as some key ideas to assist with designing a governance model which efficiently integrates the economic, legal, financial and commercial relationship between the subsidiary and the overall objectives of the group.
The main features of the program are:
Identify the responsibilities, obligations and conflicts facing a subsidiary Director (whether he/she is an executive, non-executive or independent Director).
Identify how the group can benefit by adapting the governance of the subsidiary to integrate group objectives, whilst respecting the unique challenges the subsidiary faces in its own activities.
Identify how and when Directors of a subsidiary should integrate the group view into their deliberations.
Identify how to manage key intra-group transactions such as dividends, financing, fiscal structures, commercial transactions, etc.