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Leisure Holidays Limited (LHL) is a resort company based in the Bay of Islands. Its tourist activity operations include boating, diving and deep-sea fishing, a backpackers’ hostel and a family hotel. Brian and Valerie Baxter own the majority of the shares in the Baxter Group Limited which controls LHL. Brian is the chairman of the board of directors of both LHL and the Baxter Group, and Valerie is a director of both companies as well as the Chief Financial Officer (CFO) of LHL.
Hi sir,
Could I inquire some questions about the case?1st, can Brian be the chairman of both the parent company and subsidiary? Though parent co and subsidiary has the same interest, but he is not independent, right?
Likewise, can Valerie be a director of both of parent co and subsidiary? He is not independent, right?
2nd, does it matter if Valerie, the major shareholder be the director as well as the CFO at the same co?
Besides, does Brian have to quit the role as Chairman of both companies or it is fine if he quit the role in one company? What’s the recommendation on the two people?
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