Ethical Scenario # 7

(7) You own a small business that manufactures a popular, sugary beverage. To keep costs down, you sweeten the beverage with very cheap high-fructose corn syrup. The drink contains the equivalent of 9 teaspoons of sugar. Evidence is mounting that soft drinks are responsible for the obesity epidemic in the United Statesmore than two-thirds of American adults are overweight and more than one-third are obese.

Your children have been complaining about the fact that you are selling an unhealthy product. Of course, the product is paying for their college tuition. You do not have the money to do what the big soft drink companies have done -- diversify and also sell healthier beverages. What should you do? Should the owner continue or discontinue selling beverages with high-fructose corn syrup? Identify at least 3 courses of actions or alternatives.

1 What is the ethical dilemma or issue?

2 What are the alternatives or possible courses of action? Identify at least 3 alternatives.

3 What are your recommendations? In other words, of the several alternatives you identified, what do you think the company should do?

4 What is your rationale for your recommendations? In other words, why do you recommend this course of action?

Ethical Scenario # 8

(8) You are the CEO of a chicken-processing company. The Vice President of marketing informs you that if you label your chicken as free range you can charge 20% more and greatly improve profit margins.

You find out that all that needs to be done to legally use the term free range is to open the door to the henhouse for 5 minutes a day. This provides the chickens with access to the outdoors when, in fact, very few chickens will wander out when the door is open for 5 minutes. Moreover, the term free range may be used regardless of space per chicken, number of chickens, or amount of time spent outside. Should the CEO use the term free range on the label or not use the term free range? Identify at least 3 courses of actions or alternatives. 1 What is the ethical dilemma or issue?

2 What are the alternatives or possible courses of action? Identify at least 3 alternatives.

3 What are your recommendations? In other words, of the several alternatives you identified, what do you think the company should do?

4 What is your rationale for your recommendations? In other words, why do you recommend this course of action?

Ethical Scenario # 9

(9) You are the CEO of a baked-goods plant located in the South Bronx. You have gotten into the doughnut business and your marketing Vice President suggests using a brand name that suggests that the doughnuts are made in the old fashioned way. She suggests using the brand name, Grandmas Old-Fashioned Bakery to evoke the image of a simple bakery using healthy ingredients. Should the company should use the brand name Grandmas Old-Fashioned Bakery or not? Identify at least 3 courses of actions or alternatives. 1 What is the ethical dilemma or issue?

2 What are the alternatives or possible courses of action? Identify at least 3 alternatives.

3 What are your recommendations? In other words, of the several alternatives you identified, what do you think the company should do?

4 What is your rationale for your recommendations? In other words, why do you recommend this course of action?

Ethical Scenario # 10

(10) You are Chairman of the Board of a fairly successful company. Many of the shareholders have been complaining about excessive compensation for the CEO of your firm, especially since employee wages are very low. They cite a statement by Warren Buffett that the ability of corporations to rein in skyrocketing CEO pay is the acid test of corporate governance reform.

You find that the CEO earns $22 million a year and the lowest paid worker in the company earns $22,000. This ratio of 1000:1 seems a bit high to you. A recent study published by the Economic Policy Institute indicated that CEOs at large firms in the United States make about 300 times more than the typical worker. Other members of the Board feel that since the stock has been going up, the salary for the CEO should be raised. Should the salary of the CEO be raised or not? If it should be raised, by how much? Should the salary of the CEO be decreased? Identify at least 3 courses of actions or alternatives.

1 What is the ethical dilemma or issue?

2 What are the alternatives or possible courses of action? Identify at least 3 alternatives.

3 What are your recommendations? In other words, of the several alternatives you identified, what do you think the company should do?

4 What is your rationale for your recommendations? In other words, why do you recommend this course of action?

Ethical Scenario # 11

(11) You are Chairman of the Board of a successful technology firm. There is a nominal federal corporate tax rate of 35 percent, yet the effective tax rate of the typical corporation is about 12.6%.

Your firm has been clever with use of transfer pricing and keeping money abroad and has barely paid any taxes over the last 5 years; during this same time period, profits were $28 billion. One member of the board feels that it is un-American to use various accounting strategies in order to avoid paying taxes. Others feel that these are legal loopholes and corporations have a fiduciary responsibility to minimize taxes. One board member quoted what the CEO of Exxon once said: Im not a U.S. company and I dont make decisions based on whats good for the U.S. Should the company should continue or discontinue using accounting strategies to avoid paying income tax? Identify at least 3 courses of actions or alternatives. 1 What is the ethical dilemma or issue?

2 What are the alternatives or possible courses of action? Identify at least 3 alternatives.

3 What are your recommendations? In other words, of the several alternatives you identified, what do you think the company should do?

4 What is your rationale for your recommendations? In other words, why do you recommend this course of action?

Ethical Scenario # 12

(12) You are CEO of a small company that manufactures sophisticated drones. Your companys drones are used for non-military purposes such as fighting wildfires, monitoring borders, aerial photography, and law enforcement (finding criminals). You have just received a huge order worth millions of dollars from a firm located in a country ruled by a vicious dictator.

This dictator has been known to suppress human rights and has been waging a war against a group fighting for democracy. In the past, he has even used chlorine gas against his own people. The company assures you that the drones will not be used for military purposes. You suspect that the company is a front for the government and may modify the drones as weapons so that they can be used to target freedom fighters and terrorize civilians throughout the country. Should the company should sell or not sell the vicious dictator the drones? Identify at least 3 courses of actions or alternatives. 1 What is the ethical dilemma or issue?

2 What are the alternatives or possible courses of action? Identify at least 3 alternatives.

3 What are your recommendations? In other words, of the several alternatives you identified, what do you think the company should do?

4 What is your rationale for your recommendations? In other words, why do you recommend this course of action?