MRL2601
ASSIGNMENT 2 –
SEMESTER 1
(2025) DUE APRIL
2025
, MRL2601 ASSIGNMENT 2 – SEMESTER 1
(2025) DUE APRIL 2025
QUESTION 1: Cool Coals (Pty) Ltd operates within a poor
community and made three times the usual profit at the
end of 2024. The board of directors of Cool Coals (Pty) Ltd
debates whether the company should issue university
bursaries to learners who have completed grade 12 in
2024 in the community. Some of the directors are
opposed to this view. They claim that the company
should be managed exclusively in the interests of the
shareholders with the result that: (a) the interests of
other stakeholders such as the community and its grade
12 learners cannot be taken into account; and (b) all the
profits of the company must be distributed to the
shareholders of Cool Coals (Pty) Ltd. As the company
secretary, the board of the company approaches you for
advice. With reference to the principle of Ubuntu as
expressed by Madala J in the case of S v Makwanyane
1995 (6) BCLR 665 (CC) and the facts in the scenario
above, advise the board of Cool Coals (Pty) Ltd on
whether the payment of university bursaries may be
justified on the basis of the principle of Ubuntu, or
whether the profits of the company should be distributed
exclusively to its shareholders.
Legal Advice to the Board of Cool Coals (Pty) Ltd
Subject: Whether the payment of university bursaries aligns with the principle of Ubuntu and
corporate governance obligations.
1. Introduction
The debate centers on whether Cool Coals (Pty) Ltd should allocate profits to university
bursaries for local Grade 12 learners (a stakeholder-oriented approach) or distribute all profits
exclusively to shareholders (a strict shareholder primacy view). The principle of Ubuntu, as
articulated in S v Makwanyane, provides a moral and legal framework to assess this issue.
ASSIGNMENT 2 –
SEMESTER 1
(2025) DUE APRIL
2025
, MRL2601 ASSIGNMENT 2 – SEMESTER 1
(2025) DUE APRIL 2025
QUESTION 1: Cool Coals (Pty) Ltd operates within a poor
community and made three times the usual profit at the
end of 2024. The board of directors of Cool Coals (Pty) Ltd
debates whether the company should issue university
bursaries to learners who have completed grade 12 in
2024 in the community. Some of the directors are
opposed to this view. They claim that the company
should be managed exclusively in the interests of the
shareholders with the result that: (a) the interests of
other stakeholders such as the community and its grade
12 learners cannot be taken into account; and (b) all the
profits of the company must be distributed to the
shareholders of Cool Coals (Pty) Ltd. As the company
secretary, the board of the company approaches you for
advice. With reference to the principle of Ubuntu as
expressed by Madala J in the case of S v Makwanyane
1995 (6) BCLR 665 (CC) and the facts in the scenario
above, advise the board of Cool Coals (Pty) Ltd on
whether the payment of university bursaries may be
justified on the basis of the principle of Ubuntu, or
whether the profits of the company should be distributed
exclusively to its shareholders.
Legal Advice to the Board of Cool Coals (Pty) Ltd
Subject: Whether the payment of university bursaries aligns with the principle of Ubuntu and
corporate governance obligations.
1. Introduction
The debate centers on whether Cool Coals (Pty) Ltd should allocate profits to university
bursaries for local Grade 12 learners (a stakeholder-oriented approach) or distribute all profits
exclusively to shareholders (a strict shareholder primacy view). The principle of Ubuntu, as
articulated in S v Makwanyane, provides a moral and legal framework to assess this issue.
