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1. Assignment Solutions, Case study Answer sheets
Project Report and Thesis contact
aravind.banakar@gmail.com
www.mbacasestudyanswers.com
ARAVIND – 09901366442 – 09902787224
Business Ethics
Case Studies
Case (20 Marks)
The notion of corporate moral responsibility has expanded significantly in the past few
decades, according to Manuel Velasquez,chair of the Santa Clara University anagement
Department. The Charles Dirksen Professor in Ethics provided a theoretical look at the
topic in a presentation for the June 13, 2006, meeting of the Business and rganizational
Ethics Partnership. Katie Tillman Buck,associate director of corporate affairs and ethics
at Affymetrix, followed Velasquez with a description of how her company, a leading
supplier of genetic diagnostic research equipment, approaches corporate moral
responsibility. Moral responsibility can be interpreted two ways, Velasquez said: in
terms of obligation or duty; or in terms of culpability. "The notion of moral
responsibility that we have,both in the law and in our everyday lives, is fairly straight
forward," Velasquez explained. "A person or an agent or a party is morally responsible
for an injury if 1) they caused it, 2) they knew what they were doing, and 3) they could
have prevented it." This concept applies to corporations as well. Traditionally, a
company was morally responsible for injuries it inflicted provided the same three
factors held. However, the idea of moral responsibility has been expanding over the
years. "During the second half of the 20th century, a company was held responsible for
injuries users of its products inflicted on themselves," he said. "The company is held
morally responsible provided they knew about it in some way, or should have known
about it, and it could have prevented it." This interpretation expanded even further with
the idea of strict liability. "A company is now held responsible also for injuries users

2. inflicted on themselves, even when the company could not have prevented it," Velasquez
said. Over the last couple of years, a company's scope of moral responsibility has even
extended upstream (to suppliers) as well as downstream (to endusers).
"During the last 20 years or so, there are a number of companies that have been held
morally responsiblenot legallybut in the eyes of the public have been held morally
responsible for injuries that their suppliers have inflicted on some third party," he
noted. Companies in the apparel industry, toy manufacturing, electronics assembly, and
others have been perceived as accessories to the mistreatment of workers by their
suppliers, even if they have not been directly involved. Many now try to prevent that by
doing onsite inspections. Downstream responsibility has also expanded in the last two
decades or so. "Companies have been held morally responsible for injuries which they
did not inflict on somebody else, injuries in which their product was not defective, but
injuries in which one of their customers used one of their products to inflict an injury on
a third party," he said. Gun manufacturers and bar owners are two notable examples.
"It's odd when you think about it, because this differs pretty substantially from that first
notion of moral responsibility with which we began, where a party is morally
responsible for an injury they inflict on another person knowingly and being able to
prevent it. This is a very stretched notion of moral responsibility that's being used
today," he said. This brings up two theoretical questions: 1) To what extent is a company
morally responsible for the way in which its customers use its products? 2) How can a
company minimize its exposure to this kind of moral responsibility? The second
question is commonly dealt with before the fact by monitoring who buys the products
(for example, checking the background of potential gun buyers) or after the fact by using
publicists and lawyers. But as one attendee of the BOEP meeting noted, many
companies do not want to answer the first question because they are afraid of the
answer. By asking the question, they become responsible for monitoring their product's
use. Such reluctance has not been the case with the Santa Clara, Calif., company
Affymetrix. "There's this awareness in the general community as well as the genetics
community that genetic information is powerful," Buck acknowledged. The Affymetrix
technology, for example, can put 6.5 million discrete pieces of genetic information on a
single chip. "It can be used for a lot of great things, and it can probably be used for a few
bad things." According to Buck, Affimetrix understands that exploring the ethics of how

3. its chips are used is ultimately in the company's best interests. "Our interests looking
into these issues of moral responsibility, looking at these ethical issues, really melds very
well with what our business goals are," Buck explained. "We're at the stage where
3/8/2017 Aeren Foundation2/4 not being thorough, getting embroiled in something
that just feels bad to people, would be bad for us and would be bad for the technology's
ability to address all those markets we want to be in." The company has taken a
proactive approach to these concerns, setting up an Ethics Advisory Committee to
address moral and ethical issues. The committee consists of seven external participants
who have varied backgrounds, including law, anthropology, genetics, bioethics, and
sociology. They offer independent, noncorporate views on the issues. "They're very
different. We actually picked them not with the idea that they wouldn't get along, but
with the idea that they wouldn't agree. Our goal at these meetings is to really get
everything out on the table," she said. The committee meets four times a year. "We
always have two or three executives in the room, as well as a selection of people from
throughout the organization," Buck said. Her goal over the past five years has been to
embed the idea in the corporate culture that ethics are important and that this
committee is available to people throughout the organization. Discussions vary at the
meetings. "A lot of what we talk about at the Ethics Advisory Committee is completely
hypothetical. It's becoming less hypothetical over time. It's becoming more and more
realistic now," she said. "But we're really trying to get ahead of the ball." One issue the
committee has looked at has been newborn screening the practice of automatically
testing newborns for existing diseases and conditions before they leave the hospital.
Even though Affymetrix products are not currently used in newborn screening, they
could be, so the committee has addressed issues such as informed consent, genetic
privacy, storage of samples, the need for federal regulations, etc. Putting ethics into
practice The committee has discussed less hypothetical situations as well. For example,
the company received a proposal from an Israeli company that intended to use an
Affymetrix chip to test for disorders common to that population, including TaySachs
disease. It included several other disorders, as well, both treatable and untreatable, in
addition to lateonset diseases, with no indication of when the testing would be done.
The proposal also indicated that the company intended to market a Palestinian chip,

4. and even a Swedish chip. The red flags this project raised (possible geopolitical
implications and questionable genetics, among others) concerned Affymetrix.
Additionally, Affymetrix determined that the company was more of a marketing firm
than a genetic testing company, so they declined to be involved with the project. "That
wasn't really the first thing we wanted to do coming out of the gate, so we passed on
that," Buck said. The constant emergence of new markets for genetic technology means
new questions every day. "This is a new industry. This is new research people are doing,"
Buck noted. Taking part not only in internal discussions about moral responsibility, but
national discussions as well, "being informed on what's going on and weighing in on the
things that are particular to the kinds of data that we're generating" is a way of helping
shape the moral climate of the industry as well.
Answer the following question.
Q1. Discuss the Ethics of Product Usage.
Q2. How the Moral responsibility can be interpreted. Explain.
Case (20Marks)
Most people want to be ethical — and consider themselves to be. But incidents ranging
from stolen library books to rogue trading illustrate that many people do not act as
ethically as they want to, or as they think they do. “With all the evidence to support
rational, good choices in the workplace or the marketplace, why don’t we all behave that
way?” said Ann Skeet, director of leadership ethics at the Markkula Center for Applied
Ethics at Santa Clara University. Skeet gave an introduction to a May 11 forum called,
“The Behavioral Movement: What Business Professionals Should Know About Human
Nature,” sponsored by the Business Ethics Partnership of the Markkula Center. Two
speakers addressed what we know about why people behave unethically – and how the
conditions that contribute to this behavior may be particularly acute in highpressure
environments like Silicon Valley. “The culture of Silicon Valley is different than in most
other places,” said Hersh Shefrin, the Mario L. Belotti Professor of Finance at Santa
Clara University’s Leavey School of Business and a pioneer in the field of behavioral
finance. “This is a risktaking culture and a culture where goals are set very high.” This
can make Silicon Valley workers especially vulnerable to the pressures that can lead to

5. unethical decisions. For example, the increasing use of global teams, which can require
phone calls early in the morning and late at night as well as regular hours in the office,
may contribute to fatigue – a risk factor for poor decisionmaking. Still, Shefrin said,
“we’re not as unique as we think we are – just more so.” Workers in Silicon Valley are
subject to the same psychological issues as workers anywhere else. For example, all
workers have blind spots, said Ann E. Tenbrunsel, professor in the College of Business
Administration at the University of Notre Dame and the Rex and Alice A. Martin
esearch Director of the Institute for Ethical Business Worldwide. She addressed the
psychology of ethical decision making, or “why people behave unethically despite the
best intentions.” There have been significant efforts to improve ethics: at the regulatory
level; at the organizational level, with millions spent on training; and at the educational
level, with ethics being infused into the curriculum at many universities, Tenbrunsel
said. Still, the headlines announcing bad behavior keep coming. “We haven’t taken the
psychology of the decision maker into account,” Tenbrunsel said. She listed four ethical
blind spots that contribute to poor decision making — ethical illusions, ethical fading,
dangerous reward systems and motivated blindness — and elaborated on the first two.
Ethical illusions are based on “illusions of our own ethicality,” Tenbrunsel said. She
cited studies showing that library books on ethics – presumably checked out by people
who think about ethics – are stolen more often than nonethics books. And when people
are asked to rate how honest they are, a majority of people rate themselves above
average, which is statistically not possible. “We really seem to engage in hyperinflation
about things related to morality and ethicality,” Tenbrunsel said. “If everyone thinks
their companies are ethical, we don’t do a good job of really trying to find the problems.”
It helps to think of three stages of the decisionmaking process, Tenbrunsel said:
prediction, action and recollection. Before making a decision, people generally predict
that they will act in accordance with their values. When it comes to taking action, that is
not always what happens. But after the fact, “we remember that we did better than we
did,” Tenbrunsel said. Why don’t people behave as they predict they will? One reason,
said Tenbrunsel, is that prediction involves highlevel ideals, whereas the action phase is
more about the details and what is feasible at that particular moment. Forces such as
hunger, fatigue and fear come into play, for example, and may overwhelm idealistic
plans. “The body and mind’s goal is to mitigate it,” Tenbrunsel said.

6. 3/8/2017 Aeren Foundation ¾ Ethical fading, the second blind spot Tenbrunsel
discussed, happens when a person making a decision doesn’t view the decision as
one that involves ethics. People use financial criteria to make financial decisions and
legal criteria to make legal decisions, for example. So if a decision can be categorized as
something other than an ethical one, it makes it easy to not consider ethics. Language
plays a role in this area, as well: For example, a decision about “runoff” may be viewed
differently than one about “pollution.” Shefrin continued the conversation by examining
rogue trading, an example of how “finance and psychology and ethics all
interconnect.” Because trading involves taking risks, it is useful to understand the
psychology behind risktaking. For example, most people will choose a sure gain over a
smaller chance to win a larger amount. But they will choose the risk of a large loss over a
sure loss. “Three of the most important emotions associated with what happens when
you face a risk are fear, hope and aspiration,” Shefrin said. “People who are excessively
fearful tend not to take risks that are worth taking in an actuarial sense, and people who
are excessively hopeful tend to shoot for the stars when it’s not appropriate. In a
situation like the rogue trading cases, traders find themselves in a situation where the
pressures to succeed are so great that they take imprudent risks.” In addition to the
psychology of the individuals involved, the strength of corporate processes and the way
corporate culture encourages or discourages risktaking play a role. “Strong corporate
cultures that include an ethical dimension can help deal with the vulnerabilities,”
Shefrin said. “The tone always starts at the top.”
Answer the following question.
Q1. Why imprudent risks are to be taken for great success. Explain
Q2. Debate the three stages of the decision making process.
Case (20Marks)
Annapolis, Sept. 9: Nudists not only get more complete sun tans but seem to have lower
blood pressure than people who wear clothes, according to the Central Maryland hapter
of the American Heart Association. Mr. Morris Lieberman, a spokesman for the

7. Association, said tests performed on members of the Pine Tree Associates Nudist Camp
in Crowns Ville, Maryland, over the past two years showed that Nudists had fewer cases
of high blood pressure than the national average. He said that while the average
nationally is 17 percent, the 1977 sampling found seven percent of the 163 Nudists tested
had high blood pressure. In 1976, he said, only two percent of 150 Nudists tested had
high blood pressure. One member of the Association suggested that “the only reason
we’ve come up with is because the members are less inhabited. They have a tendency to
lower blood pressure because of a lack of inner pressures and a feeling of total freedom.”
Answer the following question.
Q1. Do you agree with the above case? What are your viewpoints for the same on the
ethical issues?
Q2. Help to find out the facts of the above case and comment on the unethical issues
Case (20Marks)
What's on the minds of the people serving on boards or hoping to be? What can be
learned about corporate governance trends by knowing the answer? What do the issues
business executives are wrestling with add to the picture? Santa Clara University's
Markkula Center for Applied Ethics provides quarterly programming for Silicon Valley
business executives through its Business Ethics Partnership. Stanford University's Rock
Center for Corporate Governance provides annual programming for board directors
and others aiming to explore corporate governance hot topics. The Silicon Valley
Director's Exchange, affiliated with the Rock Center, provides monthly programming on
similar topics. I serve on the board of SVDx, staff the Markkula Center's Business Ethics
Program and attended the recent Rock Center Director's College at Stanford. Listening
is perhaps an underrated activity, but opportunities to do so at these programs in the
first six months of 2015 reveal these trends worth watching for the remainder of the
year and into 2016. They also helped to illustrate the shifts in corporate governance
trends over the past decade. The pendulum is swinging back from concern solely with
shareholders to a broader set of stakeholders, from the vantage point of the corporate

8. boardroom, based on comments across a variety of topical discussions and panels.
Board directors and governance scholars readily accept a board's role in protecting the
interest of shareholders but can also now draw links to shareholder interests from the
interests of other constituents, such as employees or the environment, when considering
the impact of climate change. The introduction of KKR's Green Portfolio, in partnership
with the Environmental Defense Fund in 2007, is one example of direct ways
environmental impact is being accounted for in business, but it is not the only way.
Board directors are fully engaged on the impact to a company's longterm value not only
of measures taken to ensure the company's sustainability, but the planet's as well.
Thoughtful exchanges in discussions about public relations, mergers and acquisitions,
and climate risk and opportunity as a disruptor suggest that directors accept that
corporations need to account for broader interests because these interests do have an
impact on shareholder value. Additionally, demographic trends, like the increase of
millennial in the workforce, introduce a need to consider what those workers
are seeking in their relationship with employers. Diversity of perspective has long been
supported in research and practice as a goal boards should pursue when assembling
participants. Corporations are experiencing greater vulnerability to activist shareholders
if an investor's point of view is not represented on the board in the current environment.
The rise of LBOs and the reality that many activists are larger corporations than the
ones they target highlight a balancing act being played out in boardrooms: acknowledge
more stakeholders as their interests affect share price over time but be sure current
shareholders feel first among equals. At a minimum, add active investors to the matrix
of skills to consider when seating an effective corporate board.
Answer the following question.
Q1. Give an overview of the case.
Q2. “Active investors are required to the matrix of skills to consider when seating an
effective corporate board.” Discuss.

9. Assignment Solutions, Case study Answer sheets
Project Report and Thesis contact
aravind.banakar@gmail.com
www.mbacasestudyanswers.com
ARAVIND – 09901366442 – 09902787224