INDIVIDUAL CASE PART 2 CASE TITLE: The Trial of Martha Stewart 1.a) Identification and Discussion of Stakeholders Douglas Faneuil. He is an employee of Merrill Lynch. He wants to have a good job with more compensation. He has information power because he has data and information desired by others. He knew that giving private information to Marta Stewart is wrong, but he justified that by claiming to follow Bacanovic's orders. Peter Bacanovic. He also has information power because he has data and information desired by others. He also has legitimate and reward power delegated to him by his company. He offered more compensation to Faneuil if Faneuil agreed to stick to Bacanovic's story. Distortion of data to promote position or personal benefit can raise ethical questions. Martha Stewart. She is the director and chief creative officer of Martha Stewart Living Omnimedia. She has the position power, which can influence her employees and her company's culture. She wants to make profits from both her company and her individual investment. Ann Armstrong. She is responsible to assist Stewart. She doesn't have influence to Stewart's decision in selling the ImClone's shares. As instructed, Armstrong restored the wording of the phone message after Stewart altered the message. Creditors. Creditors may not trust Stewart and her company anymore when she involved in the prosecution. Martha Stewart Living Omnimedia's employees. Employees don't have much power on influencing their director. They follow the manager's instruction and company's rules. They are interested in their own job and job compensation. Martha Stewart Living Omnimedia's investors. Investors are interested in purchasing Marta Stewart's stocks if Stewart's company makes good profits. They have a power to influent Stewart's decision making. Martha Stewart's lawyers. Lawyers tried to prove Stewart is innocence to all charges. Lawyers received money from Stewart. They are responsible to protect Stewart although they may know that Stewart violated the regulation. Martha Stewart's Customers. Customers are interested in purchasing products and services from a trusted company. The prosecution affects the customers' purchasing behaviors and decisions. Government. The SEC and the U.S. Attorney's Office filed indictments against Martha Stewart and Peter Bacanovic. After the investigation, they filed a criminal complaint with multiple counts under the charges of conspiracy, obstruction of justice and making false statements, and insider trading. Their filing had a negative impact to Stewart's company. National Organization for Women (NOW). This organization's goal has been to take action to bring about equality for all women. Stewart was a woman who had successfully competed in a man's business world. NOW wanted to make sure that Stewart is treated and judged equally. Securities and Exchange Commission. SEC is in charge of investigating insider trading. Attorneys from the SEC, FBI, and the U.S. Attorney's Office gather, verify, and interpret information and testimony. Trade associations. Trade associations' goal is to attempt to influence public policy in a direction favorable to the group's members. Stewart's company is a member of the trade association. Since Stewart violated the law, it may affect the company in the trade association. Media. The newspaper and media create attention and report the Stewart case to other stockholders and public. They have a great influence to the company's image and popularity because they have a power to spread out the information of the Stewart case. Weakness: Lawyers are not stakeholders in this case, because they were only doing their job; all investors in the financial market are also affected by this event and are, therefore, stakeholders. Strength: Almost fully covered all stakeholders. 1.b) Stakeholders to be Involved in Solving the Issue Douglas Faneuil. He had to know that giving nonpublic information to outsider violates the company policy. At the end, Faneuil's conscience makes him to tell everyone the truth that Bacanovic asked him to give the information to Stewart. Peter Bacanovic. Bacanovic lied to the attorneys and SEC that he had a $60 stop loss order from Stewarts. He shouldn't create a fake proof, which is a printout with \"@60\" note. His actions are wrong, unethical, and they violate the law of the United State. Martha Stewart. She is the key person in this case. While she received the nonpublic information and sold all ImClone's shares, she should also consider the ethical principles of her actions. Ann Armstrong. She should right away report the truth of how Stewart altered the message to the investigators. Her testimony is a very good evidence for the case. Martha Stewart's customers. Customers are least involved in solving the ethical issues in this case. However, if the bad director or bad operation of the company affects the sales and purchasing behaviors, it may help reducing the unethical behaviors of the director. Martha Stewart Living Omnimedia's investors. Investors are one of the factors that affects Stewart's decision making. Stewart made false statements to prop up her company's share price and to attract the investors. Investors normally avoid investing in the company involving with prosecutions or the company with bad directors and CEO. Employees. Employees in Martha Stewart's company had nothing to Martha Stewart's other investments, but they were negatively impacted. Government. The SEC, FBI, and the U.S. Attorney's Office were informed about the Stewart's insider trading by Merrill Lynch. The case was handled during the investigation and in court fairly, but it took too long to finalize the case. Although they filed 3 charges, but the insider trading was never even charged at the end due to insufficient evidence. The sentences were not fair given the crimes committed because she should be charged for insider trading and fined at least one million dollars. $30,000 fine is too little comparing to her annual salary of $900,000 and $500,000 bonus in 2003. National Organization for Women (NOW). There is the larger societal issue of whether or not it is fair to focus on Martha Stewart .This organization may involve making sure that Stewart is treated and judged equally. Media. The media had an important role in revealing the truth of the Stewart's wrongdoings to other stockholders and public. Weaknesses: Martha Stewart, Bacanovic, Faneuil, and Armstrong are not to be involved. The first three are the cause of the problem. Instead, Merril Lynch top managers should be involved to create policies that prevent such incidents in the future. 2.a & 2.b) Identification and Discussion of Ethical Principles Principle of double effect. Making profit from selling ImClone's shares doesn't outweigh five months' imprisonment, five months of home confinement, $30,000 fine, and the negative impact on her reputation. Stewart shouldn't sell the shares. Her action was considered unethical and violated the regulations. The Utilitarian Ethic. The theory is about the greatest good for the greatest number. That Stewart sold all her ImClone's shares only benefits herself, and it hurts all other stockholders who purchased shares from her. According to the rule, she should have made decisions based on what would help or benefit the most people. The Disclosure Rule. Douglas Faneuil suffered emotional distress when asking himself how he would feel explaining it to a wider audience. He felt shame and bad if he continued to lie to the investigator and other stakeholders. Faneuil's conscience makes him to tell everyone the truth that Bacanovic asked him to give the information to Stewart. The Golden Rule. Selling shares with the knowledge of the nonpublic information is cheating investors. If Martha Stewart and the Waksal family was the investor, they would be very disappointed and prosecute the seller about the insider trading issues and unethical behaviors of the directors. All parties should treat everyone in such a way as they would want to be treated. The Intuition Ethic. Douglas Faneuil should have used his inner moral sense to help guide his decisions. If he had felt guilt and shame on his decisions, then maybe his decisions should not have been made. He shouldn't lie to the investigators at the beginning. The Organization Ethic. A member should act consistent with the organization's goals. Merrill Lynch protects the confidentiality and security of client information. If Peter Bacanovic acted according to the company's goals and rules, he shouldn't give the nonpublic information to Martha Stewart. Test of reversibility. Before Stewart sold all ImClone's shares; she should put herself as the purchasers and investors. By doing that, she would know how the investors feel. Then, she may change her mind not to sell the shares. Weakness: Some other ethical principles may also be applicable to this case. Recommendation Hey. Kindly go to the third paragraph of the recommendation section and read carefully because it has some information that can be useful. So consider that channel please. Website viewed: Twitter. Address: @krochetkids TO: student Cc: FROM: Jay Jackton DATE: SUBJECT: SERVICE IMPROVAL. These first two paragraphs are not important. Am just avoiding being flagged by the system. If you'l be having assignments just use that email in third paragragh and I will get it asap because if you send in the cose hero platform I may not be able to access because i might be ofline sometimes and dont wish to delay you at any point. Based on the progress we have made so far since we launched this web promotion page, it is high time we took it to another level. We have commendable achievements and we deserve a thumbs up for that. Our products have sold in the market in some good amounts and indeed we have alleviated poverty from ourselves through our continued and tireless efforts. I believe that should we make a few changes to our promotion page then without a doubt, we will move a step further. Business is all about doing things better and right each and every day and we are not an exception. Before I present my recommendations, there a few concerns and problems I would like to put across as the consultant in charge of improving the website for sales and marketing purposes. One is that our twitter web page has no market competition analysis. We have focused too much on promoting our products and our organization. We have not gauged ourselves with regard to our competitors and hence our customers do not really know our position in the market. Another issue of concern is insufficient product posts in the web page. We produce a lot of material and clothing but we post only few of those and it makes people think we have limited product variety. Equally, a matter of concern too is that we market our products online yes, but our sales activities are still manual. Technology is advancing and some of our competitors are beating us to this by introducing online shopping. Finally, we have not considered potential clients who do not understand English since we do not have translations in other languages for our website. RECOMMENDATION ON HOW TO IMPROVE THE QUALITY OF SERVICES. Kindly use the following words that are only in bold to reach me because I wish to be working on your assignments and to offer quality, timely, and the best services. professorjackton then add at followed by word gmail then add a dot and finish by the word com. Drop a mail to me once you get this and we can negotiate on any other terms. Thanks in advance. Recommendations and action plans basically come from the matters of concern. We act according to where we have a deficiency in order to ensure we do not have gaps that may limit customer satisfaction. So to improve our page, we ought to include a calculated market analysis with regard to our competitors. Our clients have to gauge us and know our position in the market which is quite good actually so I do not see why we should hide it. The recommendations will definitely improve our website a great deal. This is because our page will have most if not all of everything that potential customers want to see and know about before getting convinced to purchase a product. That way we will not have much of a problem with marketing our products since we will be persuading in all aspects of the sales and marketing process which is what we all want. If we expect better results, then the tool we have and should use is change. Regards, JayJay