MRL2601 Assignment 2 2025 – Due April 2025

MRL2601
ASSIGNMENT 2 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.

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