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Business Ethics
Case Studies
Case (20Marks)
San Francisco: Waste from computers,
televisions and other devices used in the United States is polluting
environment and exposing workers to toxic chemicals in region of India and
China where discarded electronics are dismantled, a study released on Wednesday
said. Researchers detected high levels of toxic metals in more than 70 samples
collected in March from industrial waste, river sediment, soil and groundwater
around the southern Chinese City of Guiyu and the suburbs of New Delhi,
according to the report by Greenpeace International. Dust from dismantling
workshops contained the highest level of contaminants. “The extent of the contamination
is even worse than we had feared. The levels analyzed are really scary and very
concerning,” said Ted Smith, the founder of the Silicon Valley Toxics Coalition
who chairs the computer Take Back Campaign, which promotes electronics
recycling. Most of the electronics collected in the United States for recycling
are supplied to China, India and other Asian countries where worker protection
and environmental safety standards are weak, Smith said. The researchers chose
to collect samples from the Mayapuri and Burari areas of New Delhi because the
two regions are known to dismantle discarded American electronics to recover valuable
metals such s gold, platinum and silver. The samples collected from those areas
contained elevated levels of heavy metals including lead, tin, copper, cadmium
and antimony.
Answer the following question.
Q1. Explain the ethical issues in the
above case.
Q2. Explain the unethical issues
involved in the above case.
Case (20Marks)
Executive compensation has been in the
news as part of an ongoing discussion of income inequality. But as James
O'Toole, the moderator of a panel called "Executive Compensation" at
a recent meeting of the Business and Organizational Ethics Partnership at Santa
Clara University's Markkula Center for Applied Ethics, said, there is a
question as to whether a problem even exists. Are executives paid what they're
worth, or too much? In addition to O'Toole, senior fellow in business ethics at
Santa Clara University and former Daniels Distinguished Professor of Business
Ethics at the University of Denver's Daniels College of Business, the panel consisted
of Leslie Denend, former CEO of Network General, former chairman of the board
at Verifone, and former board member at Exponent, McAfee and USAA; Tim Sparks,
founder and president of compensation consulting firm Compensia; Edward Lawler,
Distinguished Professor of Business and director of the Center for Effective
Organizations at the University of Southern California's Marshall School of
Business; and Donna Morris, senior vice president of global people and places
at Adobe. O'Toole started the panelists out by asking how we evaluate corporate
leaders. Is the sole criteria the extent of wealth created for shareholders? Or
should they also be judged by the way they produce those profits? Similarly,
should CEOs be paid solely based on the company's performance, or are there
fairness and other issues to consider? The panelists took turns giving their
perspective on these initial questions and then continued the discussion.
Morris looked at the issue from the point of view of a practitioner.
Compensation, she said, is both an art and a science. "Ultimately we're an
IPbased business," Morris said. "The core asset that we have goes
home every day. Rewards are as important to a bright new grad as to the
executives that work for us." Lawler said he started studying pay 50 years
ago. "The gap between the lowest and the top has escalated enormously –
this is a longterm
trend," Lawler said. It's a complex
issue, he said, and can be looked at from the shareholders' point of view or
from the perspective of sustainability. "Things
are going better from the shareholder
perspective than for sustainability," Lawler said. Sparks said the demise
of stock options and the emergence of performancebased
equity compensation have driven a lot
of changes, especially in the tech industry, in recent years. These trends can
be traced to changes in the accounting treatment of different types of equity
compensation. One question that has arisen is how to disclose executive pay
when it's not clear how much equity the executive will actually receive, since
that will be based on performance, or how much it will ultimately be worth.
Denend laid out five points for creating ethical compensation packages, from
the perspective of a board member. First, board members need to understand the
context and expectations of the work they're taking on. Board members are
expected to be independent and devote enough time to the work, for example.
Second, board members should take the shareholders' perspective. "Every
dollar you don't pay" in compensation is available to be distributed to
shareholders, he said. A third point, Denend said, is to make sure the pay is
fair. This often means making sure people doing similar jobs are paid the same,
though he said it's difficult because all boards want to judge that their
management team is above average. A second way to look at fairness is from top
to bottom: Among companies in the same peer group, how much compensation goes
to the CEO, how much to the CEO's direct reports, and how much to everyone
else? Denend's fourth principle was paying for performance, though he noted
that "the devil's in the details." The connection between pay and
performance is not fully understood,
he said, but "it's not always as
direct as you think." Finally, Denend said board members need to use good
judgment and get advice: "Sometimes when the numbers argue that you do one
thing, step back and say, 'What's the right thing to do?'"
Answer the following question.
Q1. Explain the five point laid out by
Denend for creating ethical compensation packages, from the perspective of a board
member.
Q2. Discuss the concept of performance based
equity compensation.
CASE 8 (20 Marks)
Thirty two sadhus from Punchamahal
district, who were on a 72hour relay hunger strike at Godhra since Friday to
canvass against the BJP candidate from the Lok Sabha constituency there, Mr.
Shankarisinh Vaghela, from his role in the toppling of the Keshubhai Patel
ministry after spearheading a revolt, called off their agitation today, reports
PTI. Reports received from Godhra, about 80kms from here, said the mahanta and
sadhus, along with the vice president of all India ShadhuSant’s Samiti,
Avichanddas Maharaj from Sarsa in Anand Constituency, withdrew the fast, which
was to end at 2.00 p.m. tomorrow. It was not immediately clear as to why they
called off the protest prematurely. The sadhus had said they wanted to ensure
the defeat of Mr. Vaghela in the election and alleged that he had betrayed them
by dethroning Mr. Patel last October. They also demanded an end to ‘Khajuraho
Culture’ in the BJP and noted that Mr. Vaghela had flown dissident BJP MLAs to
Khajuraho in Madhya Pradesh during the revolt by some rebels in the party.
Meanwhile, the Chief Minister, Mr. Suresh Mehta, at a press conference at the
Chhotaudepur town in Baroda district, appealed to the sadhus to end their
program of dharna ‘in the interest of the BJP and the nation’.
Answer the following question.
Q1. Explain the unethical aspects in
the above case
Q2. Suggest remedial measures in the
above case.
Q3. What are your viewpoints on the
above case
Q4. What do you mean by ‘ Khjuraho
culture’ in the case? Explain.
Case (20 Marks)
Linda attends a large public university
in Oregon. Before coming to college, Linda was a closeted lesbian. In her
hometown she never felt comfortable opening up to anyone, be it family, friend,
or mere acquaintance. When she arrived at her university, Linda
was able to find a safe haven with the
LGBT (Lesbian, Gay, Bisexual, and Transgender) club. As Linda got more
comfortable at her university, she began to go out at night to meet individuals
outside of her LGBT community. She was able to find friends involved in different
parts of her college campus: multicultural club, Greek life, student
government, and more. One day, Linda is at a fraternity party with some of her
friends in Greek life. While dancing and enjoying music, Linda overhears a
conversation occurring at the beer pong table. One of her friends, Justin, is
disappointed that his teammate is taking so long to finish his drink. She
overhears him say, “That’s so gay.” Linda confronts Justin and expresses her
distaste with the language he used. She tells him “gay” shouldn’t be a slangterm
for lame or stupid. Justin doesn’t understand what the big deal is. He tells
her that he is fully accepting of homosexuality and didn’t mean any harm with
his words. Linda doesn’t accept this, refuses to speak to Justin again, and
leaves immediately. A few weeks later, Linda and Justin are at the same nature
hike with the Wilderness Club. At the end of the hike, there is a waterfall
where you can jump into a lake below. Justin overhears Linda telling one of her
friends to “Man up.” He confronts her about the term, saying that man up
implies gender norms. Linda doesn’t understand why he’s so upset with this
term. She says that it is used universally and isn’t supposed to insult anyone.
Answer the following question.
Q1. Do you think there is a difference
between using the terms “That’s so gay” and “Man up?” Is it okay to use either of
them? Discuss.
Q2. Does the unconscious use of above
terms contribute to harmful stereotypes or does everyone understand that they don’t
really mean anything? Comment.
Assignment Solutions, Case study Answer sheets
Project Report and Thesis contact
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