The European Middle and High School and the Hypotheken-Investment Gmbh: When Non-Profits and Profits had a Meeting of Minds

Published 01 Oct 2004
Reference 5227
Topic Strategy
Region Europe
Summary

The board of the European Middle and High School is engaged in a negotiation with an investment bank to lease a building that it needs in order to expand the size of the school. The negotiator for the investment bank has made a tough offer to the School which is under pressure to accept it. At the moment of the decision, the board discovers it will have to make additional investments in the property. Should it go ahead and accept the deal? What are the financial and business considerations? Is the negotiator for the investment bank right to try to extract the best deal for his company?

Teaching objectives

The purpose of the case is to understand the problems facing non-profit organizations and their boards regarding their interactions with the private market. The participants are asked to evaluate the finances of the contract and also the ethics of an individual in the private sector who is seeking the best deal possible from a voluntary board that lacks professional skills. The case can be used to teach the challenges facing non-profit boards, negotiations, and ethical dilemmas.

Keywords
  • Non-Profit
  • Corporate Governance and Boards
  • Society and Business
  • Negotiation
  • Education Industry
  • Multi-Cultural Organizations. RD0904
  • AR2004