BMGT 496 - Project 1: News Event (20%) Project 1 is due Tuesday at 11:59 p.m. eastern time of week 3 unless otherwise changed by the instructor. Purpose: In the first assignment, you have the opportunity to see how ethics can play out in a real world scenario. You will read the case scenario and answers the questions in a narrative format. Use headings for each question. Headings are not the question. You are required to use the course material to support your reasoning and the conclusions made. Outcomes met by completing this project: 1. identify ethical issues that arise in domestic and global business environments using an understanding of ethical concepts and of legal and business principles Case Scenario: Pacific Gas and Electric Corporation (PG&E) that supplies electricity and natural gas to 16 million people, owns the transmission lines attributed to causing the November 2018 California "Camp Fire" that killed 85 people and destroyed thousands of acres of land including wildlife and the town of Paradise, California. Facing more than $30 billion in liability costs, the company has filed for bankruptcy protection. Recent investigations including documents obtained under the Freedom of Information Act, reveals disturbing historical facts about the company's knowledge and management of its infrastructure. The information shows that the company knew of 49 steel towers needing replacement long before the November fire (WSJ, 2019). Built in the early 1900s, much of PG&E's original equipment remained in service including towers with a life expectancy of 65 years but kept in operation up to 108 years (WSJ, 2019). More than 2500 towers in the system were installed in the 1900s and 1910s, and an additional 6900 towers were kept in operation without knowing their age (WSJ, 2019). According to Federal Regulatory findings PG&E repeatedly delayed upgrades to the older equipment, opting instead to spend billions on projects like sub-station upgrades. California's rules for electrical transmission are a simple three sentences stating that each utility company must come up with its own procedures and follow them. The danger was exacerbated in 2013 when historic drought dried up California land. In 2017 the company acknowledged in its internal documents that a plan was needed to prevent structural failure and ground fires. State officials concluded that equipment failure on the Caribou-Palermo line, built in 1921 was the cause of the deadly California fire. According to an attorney representing victims in a lawsuit against PG&E, the company spent money from customers to boost corporate profits and compensation, rather than infrastructure maintenance and safety (CNBC, 2018). The lawyer further stated that while other utilities routinely shut power lines down when windy conditions prevailed, PG&E's pattern was to remain in service. He attributed this to management bonuses that were tied to customer complaints, rather than safety.