Question #1.

Humongous Inc. is a large publicly traded manufacturer of health care products. It has a reputation as one of the best-managed companies in the U.S.A. However, the company recently came under fierce criticism by the government for charging exorbitant prices to consumers. Investors have responded negatively to fears that the government would reform the health care sector and make an attempt to reign in prices. As a result of these fears, Humongouss stock price lost 30% of its value in the past year.

To try to appease the government and counter possible government intervention, Humongous just purchased Teeney Corp., a discount health care supplier. Investors have responded positively to this acquisition, pushing Humongouss stock price back up by over 10% since news of the acquisition became public.

While Humongous Inc.s acquisition of Teeney Corp. could provide Humongous with a foothold in a growing part of the discount health care sector, a real problem lies in the mission of Teeney Corp. Teeney has built a successful business by providing consumers with unbiased, objective health care advice and guiding them to the best prices available. However, now that it is owned by Humongous, Teeneys customers have expressed doubts about whether Teeney can remain objective and unbiased in recommending the best health care products at the best price.

Assume that you are a manager charged with bringing Teeney Corp. into Humongous Corp and helping the two companies to integrate. Please answer the questions below. Please make sure to break up your answer into paragraphs, starting a new paragraph whenever you start a new idea.

Are you facing an ethical issue? Why or why not? Do Teeneys customers have reason to doubt the future objectivity of the company? Why or why not? If this is a problem, what steps can you take to mitigate that problem? (This answer could be about two paragraphs).

As a manager charged with bringing Teeney into Humongous, what are your ethical and legal obligations to Humongous? To Teeney? To the customers of both? What do you owe shareholders? Are there other stakeholders? If so, what do you owe them? (This answer could be about three or four paragraphs).

Questions # 2 and #3.

Question #2.

BASIC FACTS PROVIDED: Janet is a buyer of suits for Macys. Janets job involves deciding what kinds of suits to buy for the upcoming season, and which vendors to buy them from.

(a) Build on these facts to describe a situation in which Janet might face a possible temptation to engage in commercial bribery. (This section should be about 1 or 2 paragraphs long. But you can write more if you wish).

(b) Explain why the situation that you have just described above is problematic using the ethical theories that we covered in class. This should be about 2 or 3 short paragraphs.

Question #3.

BASIC FACTS PROVIDED: You work as a salesperson selling life insurance policies for the Hartford Life Insurance Company, Connecticut. You just received an offer to take a similar job for much more money with the Providence Life Insurance Company, Rhode Island.

(a) Using these facts as your base, create a scenario that might pose a possible temptation for you to breach your fiduciary duty. (2-3 paragraphs)

(b) Explain what would be wrong with breaching your fiduciary duty in the scenario that you just described. (2-3 paragraphs).

Question #4.

A family business holds, as its two core corporate values, compassion and fairness. The CEO, who is the founder of the family business, has had his only brother on payroll for about 5 years.

The brother has had major financial and family difficulties. Four years ago, he lost all of his savings after investing with a Floridian wealth manager who stole the money and left the country. And his wife just gave birth to a baby with severe developmental problems.

The brother is a terrible employee. He has a very bad attitude, arriving late for work, leaving early, skipping meetings, not making deadlines, and turning in incomplete work.

Over the years, the CEO and his management team tried everything they could possibly think of to get the brother to improve his behavior all to no avail. They even hired a life coach and a professional coach for him. But that, too, failed to produce any positive palpable results.

The brothers lackluster performance has been having a negative effect on other company employees, who feel that he is being treated preferentially in a way that is unfair to them. Some of these employees have become bitter and have started arriving late and leaving early, as the CEOs brother does. The morale problem seems to be getting worse.

The managing director has repeatedly requested the CEO to fire his brother. The CEOs was always evasive in response to this request. In the meantime, he has done has nothing to remove his brother.

You are a consultant hired to advise the CEO on the matter. Drawing on the concepts covered in our aligning values and practices class, please advise the CEO. Make sure you discuss each of the following in your advice to the CEO:

• What values, if any, are in conflict in this case?
• Did the CEO pick corporate values that mean something? Why or why not?
• What would you advise the CEO to do? Explain your answer by drawing on the importance of value alignment.

Based on your advice to the CEO, which corporate value(s) would you suggest that the CEO pick for his company going forward? How could the CEO be sure that these value(s) were authentic and meant something?