Ivey Publishing

Business Ethics

De George, R.T.,6/e (United States, Pearson, 2005)
Prepared By Geoffrey Kistruck, Ph.D. Candidate (General Management)
Chapter and Title Chapter Matches: Case Information
Chapter 1:
Ethics and Business

CITIBANK MEXICO TEAM: THE SALINAS ACCOUNTS
Henry W. Lane, David T.A. Wesley

Product Number: 9A99C009
Publication Date: 4/13/1999
Revision Date: 1/14/2010
Length: 12 pages

The head of a bank's Mexico Team must consider her options when confronted with the task of aiding in the arrest of one of her clients. She had just returned from Switzerland, where Swiss narcotics agents were encouraging her to lay a trap for the wife of one of her clients, the brother of a former Mexican president, who had been arrested in Mexico a few months earlier on charges of murder, illegal enrichment, and laundering money for the Mexican drug cartel. As she pondered her options, the fate of one of her former employees, who had recently been sentenced to 10 years imprisonment for managing the account of a convicted money launderer, provided food for thought. She must consider extraterritoriality, bank secrecy laws, and professional ethics in international private banking.

Teaching Note: 8A99C09 (10 pages)
Industry: Finance and Insurance
Issues: Developing Countries; Financial Institutions; Ethical Issues; Corporate Responsibility
Difficulty: 5 - MBA/Postgraduate


Chapter 2:
Conventional Morality and Ethical Relativism

NES CHINA: BUSINESS ETHICS (A)
Joerg Dietz, Xin Zhang

Product Number: 9B01C029
Publication Date: 10/18/2001
Revision Date: 12/16/2009
Length: 9 pages

NES is one of Germany's largest industrial manufacturing groups. The company wants to set up a holding company to facilitate its manufacturing activities in China. They have authorized representatives in their Beijing office to draw up the holding company application and to negotiate with the Chinese government for terms of this agreement. In order to maximize their chances of having their application accepted, the NES team in Beijing hires a government affairs coordinator who is a native Chinese and whose professional background has familiarized her with Chinese ways of doing business. NES's government affairs coordinator finds herself in a difficult position when she proposes that gifts should be given to government officials in order to establish a working relationship that will better NES's chance of having its application approved. This method of doing business is quite common in China. The other members of the NES team are shocked at what would be considered bribery and a criminal offence in their country. The coordinator must find a practical way to bridge the gap between working within accepted business practices in China and respecting her employers' code of business ethics. The complementary (B) case (9B01C030) gives a brief summary of the eventual solution to this problem.

Teaching Note: 8B01C29 (9 pages)
Industry: Manufacturing
Issues: China; Ethical Issues; Cross Cultural Management; Management Behaviour; International Business
Difficulty: 4 - Undergraduate/MBA


Chapter 3:
Utility and Utilitarianism

NORTHEASTERN MUTUAL LIFE: PREPARING FOR EMPLOYEE TERMINATIONS
David J. Sharp, Ken Mark

Product Number: 9B02C014
Publication Date: 4/8/2002
Revision Date: 10/29/2009
Length: 7 pages

Northeastern Mutual Life is a large insurance company. As a result of falling profitability, the chief executive officer has to evaluate the rights of various stakeholders as he plans to reduce staff. He must quantify in dollar terms the moral claims of shareholders and various other stakeholders, and apply ethical analysis where legal requirements are unclear. In particular, he must decide how to manage the layoffs and the implications to the company of the payout of pension benefits.

Teaching Note: 8B02C14 (4 pages)
Industry: Finance and Insurance
Issues: Ethical Issues; Employee Termination; Productivity; Human Resources Management
Difficulty: 4 - Undergraduate/MBA


Chapter 4:
Moral Duty, Rights, and Justice

PETA'S KENTUCKY FRIED CRUELTY, INC. CAMPAIGN
Gerard Seijts, Michael Sider

Product Number: 9B03C045
Publication Date: 11/5/2003
Revision Date: 10/17/2009
Length: 20 pages

A year and a half after calling off their campaign against fast-food giant McDonald's, the vegan campaign coordinator of People for the Ethical Treatment of Animals (PETA), contacted Kentucky Fried Chicken (KFC) to warn them that they would be the next target. He pointed out in his letter that while many of KFC's competitors had convened advisory panels to help them investigate the welfare of animals raised and slaughtered for their businesses, KFC appeared completely uninterested in the issue. PETA would rather not engage KFC in a campaign, but if the company refused to put together an animal welfare panel and to begin to look into the issue of how to raise and slaughter their chickens more humanely, all the leaflets, action alerts, posters, billboards, T-shirts and press releases PETA was now preparing would be dedicated to KFC and its cruel treatment of chickens. In January 2003, PETA, fed up with what it saw as KFC's lack of open communication, public misinformation, and outright stonewalling on change, announced a campaign against the company to the media in a news event replete with bloody descriptions of the cruelties of KFC's animal factories. Now it was time for Kentucky Fried Chicken to respond.

Teaching Note: 8B03C45 (12 pages)
Industry: Accommodation & Food Services
Issues: Business and Society; Ethical Issues; Crisis and Change; Management Communication
Difficulty: 4 - Undergraduate/MBA


Chapter 5:
Virtue, Moral Responsibility, and Moral Reasoning

WESTWOOD SECURITIES (A)
James A. Erskine, Joanna Shostack

Product Number: 9B03C017
Publication Date: 5/1/2003
Revision Date: 10/17/2009
Length: 7 pages

A junior broker at a securities firm has mixed emotions. He enjoys the success his sales have brought him, however, he is concerned about misleading clients to obtain those sales. He has been offered a promotion to senior broker and must decide whether to accept the promotion, continue in his current position or leave the firm. The supplement Westwood Securities (B), product 9B03C018 discusses his decision.

Teaching Note: 8B03C17 (5 pages)
Industry: Finance and Insurance
Issues: Career Development; Sales Strategy; Securities; Ethical Issues
Difficulty: 4 - Undergraduate/MBA


Chapter 6:
Justice and Economic Systems

SIAM CANADIAN FOODS CO. LTD.
John R. Kennedy, Tony S. Frost, Tom Gleave

Product Number: 9A97G003
Publication Date: 1/29/1997
Revision Date: 2/4/2010
Length: 12 pages

The managing director and founder of Bangkok-based Siam Canadian Foods Co., Ltd., was considering the emerging business opportunities in neighboring Burma (also known as Myanmar). Although relatively undeveloped compared to the rest of Southeast Asia, Burma had been experiencing increasing levels of foreign investment activity in recent years. Siam, who had considered entering Burma in the past but declined, needed to determine if the time was now appropriate for the company to enter the market.

Teaching Note: 8A97G03 (15 pages)
Industry: Manufacturing
Issues: Ethical Issues
Difficulty: 4 - Undergraduate/MBA


Chapter 7:
American Capitalism: Moral or Immoral?

GORENJE D.D.: A SLOVENIAN MANUFACTURER CONFRONTS THE EUROPEAN MARKET
Gerald Zeitz, Ales Brglez, Irena Vodopivec

Product Number: 9B04M041
Publication Date: 6/24/2004
Revision Date: 10/14/2009
Length: 12 pages

Gorenje D.D. is a kitchen appliance manufacturer located in the small town of Velenje, in Slovenia, a newly independent country that separated from Yugoslavia in 1991. Simultaneous with gaining independence, Slovenia also underwent a change from the unique market socialism that had characterized socialist Yugoslavia, to free enterprise capitalism. Furthermore, manufacturing firms in Slovenia had produced largely for the Yugoslav market, while after independence they were forced to compete in the wider European market. The company faces new challenges and key decisions in corporate culture, human resources and competitive strategy to face a turbulent environment.

Teaching Note: 8B04M41 (7 pages)
Industry: Manufacturing
Issues: Cross Cultural Management; Strategic Positioning; Environmental Change; Human Resources Management
Difficulty: 4 - Undergraduate/MBA


Chapter 8:
Corporations and Morality

JOHN MCCULLOCH - UNITED BEEF PACKERS
James A. Erskine, Eric Dolansky

Product Number: 9B03C022
Publication Date: 6/26/2003
Revision Date: 10/17/2009
Length: 10 pages

John McCulloch takes a job as assistant general manager at a meat packing plant. After a short time in the job, he discovers it was nothing like he expected, worker safety is constantly compromised, the safety of the public from consuming tainted food is compromised and everything is subordinated to the production line's constant movement. He must decide whether or not he will stay with the company.

Teaching Note: 8B03C22 (4 pages)
Industry: Manufacturing
Issues: Working Conditions; Conflict Resolution; Ethical Issues
Difficulty: 4 - Undergraduate/MBA


Chapter 9:
Corporate Governance, Accounting, Disclosure and Insider Trading

TANYA SILK
David J. Sharp, Niels Billou

Product Number: 9A99N017
Publication Date: 9/13/1999
Revision Date: 1/21/2010
Length: 2 pages

An investment advisor has received an order to buy 1,000 coffee contracts for her client. The client, a senior weather analyst at Environmex, a private weather forecasting service, told her that he had just seen the latest long-range satellite weather data for Brazil that indicated a strong likelihood of frost in the coffee-producing regions. Frost would kill the coffee plants, seriously reducing the supply of coffee, which in turn would lead to an increase in price of the contracts. The information would be made public in a day or so. She thought to herself, This client has been pretty accurate with these forecasts; maybe it's time I started telling my other clients and put in some of my own capital. The main pedagogical objective of this case is to explore the definition of, and responsibility for, insider trading. The situation in this case is intentionally highly ambiguous. The question When is it appropriate to use information not widely available to the market? should be the main focus of student debate. Other ethical issues include confidentiality and using corporate information for personal use.

Teaching Note: 8A99N17 (4 pages)
Industry: Finance and Insurance
Issues: Ethical Issues
Difficulty: 4 - Undergraduate/MBA


Chapter 10:
Finance, Restructuring, and Investing

BIOVAIL CORPORATION (A)
David J. Sharp, Mary Gillett, Jessica Frisch

Product Number: 9B04N007
Publication Date: 4/5/2004
Revision Date: 10/15/2009
Length: 6 pages

Biovail Corporation, a large pharmaceutical company, recently had its stock downgraded by a well known pharmaceutical analyst and a number of other analysts were also scrutinizing the company. The outcome was not favorable, as Biovail's acquisition methods were labeled as unethical and their accounting practices were questioned. An investor with the company must decide if she will continue to invest in a company that has been identified with low ethical standards. The supplement Biovail Corporation (B), product 9B04N008 discusses the investor's decision, and some information that caused her to reconsider that decision.

Teaching Note: 8B04N07 (7 pages)
Industry: Manufacturing
Issues: Patents; Ethical Issues; Investments
Difficulty: 4 - Undergraduate/MBA


Chapter 11:
Safety, Risk, and Environmental Protection

BROAD AIR CONDITIONING AND ENVIRONMENTAL PROTECTION
Zhi Yi He, Meng Sun, Paul W. Beamish

Product Number: 9B04M034
Publication Date: 6/24/2004
Revision Date: 10/14/2009
Length: 12 pages

Broad Air Conditioning is a Chinese company with a proactive environmental attitude, but suffering from deteriorating financial results. The company founder and chief executive officer must decide whether to start producing electricity powered air conditioners to improve its financial results easily or stick to its ideal and only manufacture machines powered by heat. The major theme of this case is to understand corporate social responsibility, by discussing how an enterprise can find a way to harmonize the relationship between benefitting the company and protecting the environment, especially in developing countries.

Teaching Note: 8B04M34 (8 pages)
Industry: Manufacturing
Issues: China; Corporate Responsibility; Sustainable Development; Environment; Energy; Peking University
Difficulty: 4 - Undergraduate/MBA


Chapter 12:
Whistle Blowing

PRICE OF SPEAKING OUT AGAINST THE BETRAYAL OF PUBLIC TRUST: JOANNA GUALTIERI (A)
Gerard Seijts, Ken Mark

Product Number: 9B04C029
Publication Date: 9/20/2004
Revision Date: 10/9/2009
Length: 4 pages

A real estate analyst has been hired as a government employee to manage Canada's overseas property holdings, including its embassies and diplomatic residences. Despite strict government regulations regarding the procurement of overseas accommodations and policies relating to fiscal accountability, the analyst has witnessed the luxurious accommodations enjoyed by diplomatic staff posted abroad. She documents the abuses and reports the finding to her supervisor, who does nothing. The analyst must decide whether to take her finding further. The supplements Price of Speaking Out Against the Betrayal of Public Trust: Joanna Gualtieri (B), (C) and (D), products 9B04C030, 9B04C031 and 9B04C032 looks at her decision and the events that follow.

Teaching Note: 8B04C29 (9 pages)
Industry: Public Administration
Issues: Whistleblower; Accountability in the Public Service; Ethical Issues; Leadership
Difficulty: 4 - Undergraduate/MBA


Chapter 13:
Marketing, Truth, and Advertising

HAYWARD & GUZMAN: DISPOSABLE CONTACT LENSES
Niraj Dawar, Eric Dolansky

Product Number: 9B03A020
Publication Date: 6/26/2003
Revision Date: 10/15/2009
Length: 4 pages

Hayward & Guzman researches and develops contact lens products and has recently developed a new disposable contact lens. Two segments with different price sensitivity have been identified. In order to reach these segments, the products will need to be packaged and sold differently. A marketing representative for Hayward & Guzman must develop a marketing mix for the two segments and determine pricing for each product.

Teaching Note: 8B03A20 (5 pages)
Industry: Manufacturing
Issues: Market Segmentation; Ethical Issues; Pricing; Marketing Mix
Difficulty: 5 - MBA/Postgraduate


Chapter 14:
Workers’ Rights: Employment, Wages, and Unions

STAFFING WAL-MART STORES, INC. (A)
Alison Konrad, Ken Mark

Product Number: 9B04C006
Publication Date: 1/26/2004
Revision Date: 10/6/2009
Length: 9 pages

Wal-Mart Stores, Inc. is a large Fortune 500 retail chain. The distinction of being the top-ranked company comes with intense scrutiny from the public and, especially, critics. Wal-Mart, a company lauded for its rapid response capability and stated commitments to gender equality is shown to be deficient in some glaring areas - the percentage of women compared to men at all levels of the company, and the compensation paid to women versus men at all levels of the company, to cite two examples. An executive vice-president must examine why these inequalities exist when the company seems to be doing everything else right. The company is the target of several gender discrimination lawsuits and the executive vice-president has the opportunity to obtain information that would be useful in the current situation, and must determine what information is needed. In the supplement, Staffing Wal-Mart Stores, Inc. (B), product 9B04C007, the executive vice-president receives information and must determine how to address the situation.

Teaching Note: 8B04C06 (7 pages)
Industry: Retail Trade
Issues: Management Decisions; Pay Equity
Difficulty: 4 - Undergraduate/MBA


Chapter 15:
Workers’ Rights and Duties Within a Firm

JINJIAN GARMENT FACTORY: MOTIVATING GO-SLOW WORKERS
Tieying Huang, Junping Liang, Paul W. Beamish

Product Number: 9B04M033
Publication Date: 5/14/2004
Revision Date: 10/14/2009
Length: 6 pages

Jinjian Garment Factory is a large clothing manufacturer based in Shenzhen with distribution to Hong Kong and overseas. Although Shenzhen had become one of the most advanced garment manufacturing centres in the world, managers in this industry still had few effective ways of dealing with the collective and deliberate slow pace of work by the employees, of motivating workers, and of resolving the problem between seasonal production requirements and retention of skilled workers. However, the owner and managing director of the company must determine the reasons behind the deliberately slow pace of the workers, the pros and cons of the piecework system and the methods he could adopt to motivate the workers effectively.

Teaching Note: 8B04M33 (11 pages)
Industry: Manufacturing
Issues: China; Productivity; Employee Attitude; Piece Work; Performance Measurement; Work-Force Management; Peking University
Difficulty: 4 - Undergraduate/MBA


Chapter 16:
Discrimination, Affirmative Action, and Reverse Discrimination

STAMFORD MACHINE CORPORATION: ALLEGATIONS OF RACISM
Christina A. Cavanagh, Ken Mark

Product Number: 9B02C004
Publication Date: 4/29/2002
Revision Date: 10/29/2009
Length: 2 pages

Stamford Machine Corporation is a market leader in the manufacturing of photocopiers and office equipment. The director of corporate business ethics and compliance has been notified that the company is being served with a discrimination lawsuit. A newspaper announcement was released to the public outlining details of the charges and before the director could leave his office, he receives a call from a journalist asking for the company's comments. He must determine if there has been a breach in the company's policy on discrimination and plan how the company will deal with the media.

Teaching Note: 8B02C04 (3 pages)
Industry: Manufacturing
Issues: Communications; Relationship Management
Difficulty: 4 - Undergraduate/MBA


Chapter 17:
The Information Age: Property and New Technologies

ORANGEWERKS: A QUESTION OF ETHICS
Christina A. Cavanagh, Ken Mark

Product Number: 9B01C007
Publication Date: 4/23/2001
Revision Date: 5/18/2017
Length: 4 pages

OrangeWerks, an entrepreneurial company that creates software applications, is preparing to present to venture capital firms for its first major round of funding. However, during routine network maintenance, the network administrator becomes aware that the company may not have purchased the original software used to create the company's product, and that government workplace safety insurance was not in place. He must decide how to proceed with the knowledge by assessing available options and judging the stakeholder impact, as well as his career implications.

Teaching Note: 8B01C07 (5 pages)
Industry: Administrative, Support, Waste Management and Remediation Services
Issues: Action Planning and Implementation; E-Commerce; Organizational Behaviour; Ethical Issues
Difficulty: 4 - Undergraduate/MBA


Chapter 18:
Information, Computers, the Internet and Business

CANADIAN IMPERIAL BANK OF COMMERCE: DIGITAL EMPLOYEE PRIVACY
Mike Wade, Ken Mark

Product Number: 9B00E018
Publication Date: 1/26/2001
Revision Date: 1/8/2010
Length: 6 pages

The Canadian Imperial Bank of Commerce (CIBC) had implemented word recognition software, Assentor, in its U.S. brokerage arm to ensure its employees were not acting inappropriately in their dealings with customers and to protect company systems from viruses. This software scanned e-mails for flagged business words and archived the e-mails in a central database. The manager of compliance at CIBC's head office in Toronto, found that the decision to implement the Assentor software was much easier than deciding what to do in the event the software found something improper. Issues related to company ethics and employee privacy were raised. Acknowledging that occasional personal e-mails would be sent and received, he wondered what the legal ramifications would be if a manager found out about a private situation because Assentor had found a flagged word in a personal e-mail. He felt that clear communication with and upfront understanding from employees would help prevent negative impressions of this process so he had to determine the best way to inform employees about the e-mail scanning while enforcing CIBC's e-mail policy.

Teaching Note: 8B00E18 (4 pages)
Industry: Finance and Insurance
Issues: Risk Analysis; Privacy Issues; Management Information Systems; Management of Technology
Difficulty: 4 - Undergraduate/MBA


Chapter 19:
The International Business System, Multinationals, and Globalization

CAMECO IN KYRGYZSTAN: CORPORATE SOCIAL RESPONSIBILITY ABROAD
Pratima Bansal, John Scarfe, Richard Johnston

Product Number: 9B03M063
Publication Date: 11/28/2003
Revision Date: 10/22/2009
Length: 18 pages

Based in Saskatoon, Canada, Cameco was the world's largest uranium mining company. It had developed its policy for corporate social responsibility in northern Saskatchewan where it had its major mining operations and where there were a large indigenous population of Cree and Dene Indians. The issue centres on whether the same corporate social responsibility policy can be applied to the company's joint venture with the Kyrgyzstan government to operate a gold mine in eastern Kyrgyzstan. Complicating the decision was a chemical spill that had occurred several months before, and relations with citizens in nearby communities were at an all-time low. The joint venture's vice-president of human resources and corporate relations must decide which of the programs might be succesfully implemented in Kyrgyzstan, what new programs might need to be developed, and how best to communicate company policy to the local community.

Teaching Note: 8B03M63 (7 pages)
Industry: Mining, Quarrying, and Oil and Gas Extraction
Issues: International Business; Corporate Responsibility; Communications
Difficulty: 4 - Undergraduate/MBA


Chapter 20:
Corrupt Contexts and International

N.K. BUILDERS AND CONTRACTORS - INDIA
James A. Erskine, Nipun Chaudhary

Product Number: 9B02C018
Publication Date: 4/29/2002
Revision Date: 11/9/2009
Length: 10 pages

N.K. Builders and Contractors was a construction company newly formed by an experienced contractor and a young project manager. The project manager was very knowledgeable of the construction industry but not familiar with the bidding process for contracts; for this he relied heavily on the experience of his partner. The company's first project was a government contract that required the partners to go to the divisional office to apply for the tender, where they found out they were one of 15 interested in the highway project. The bidding process was similar to an auction, the highest bid won. Money generated from the highest bid was shared equally among the remaining contractors, and the higher the bid the more commission government officials received. Winning the contract is only the beginning. Once a company receives the project, they are expected to begin work within a month; however, many things can happen between winning and the completing of the contract and he would discover there would be a number of times when it would be necessary to pay various officials to proceed with the project. The project manager was disappointed in the way the company was awarded the project and now must decide if he should quit and lose the money he invested in the company or remain with the business.

Teaching Note: 8B02C18 (4 pages)
Industry: Construction
Issues: Contracting; Ethical Issues; Market Entry; Government and Business
Difficulty: 4 - Undergraduate/MBA


Chapter 21:
Global Issues and International Obligations

TALISMAN ENERGY INC.
Lawrence G. Tapp, Gail Robertson

Product Number: 9B03M028
Publication Date: 5/28/2003
Revision Date: 10/26/2011
Length: 28 pages

Talisman Energy is the largest Canadian oil and gas producer, with main business activities in exploration, development, production and marketing of crude oil, natural gas and natural gas liquid. At a special board of directors meeting, the management and board of Talisman conducted a review of the Sudan operations to assess its fit within the current business portfolio. After years of direct and often angry criticism by human rights groups and the fact that the United States government was threatening to restrict firms operating in Sudan from listing their securities on American markets, the board was considering its options in the region. The Sudan project had good economic value for Talisman with good future prospects and production possibilities. Additionally, the company had gone to considerable lengths to develop and implement socially responsible policies and programs in Sudan. Senior management believed that they had contributed to an increased quality of life for the people of Sudan. Despite this, activist groups had continued to attack Talisman for their role in Sudan. The continued pressure from activists and governments were believed to be responsible for a steady decrease in share price. The issue before the board in conducting this review was to question whether continuing operations in Sudan was compatible with Talisman's mandate to operate in the best interests of the company and its shareholders.

Teaching Note: 8B03M28 (10 pages)
Industry: Mining, Quarrying, and Oil and Gas Extraction
Issues: Board of Directors; International Management; Corporate Governance; Ethical Issues
Difficulty: 4 - Undergraduate/MBA


Chapter 22:
The New Moral Imperative for Business

YAHOO V. SURVIVORS OF THE HOLOCAUST
Henry W. Lane, David T.A. Wesley

Product Number: 9B02C051
Publication Date: 10/29/2002
Revision Date: 11/9/2009
Length: 15 pages

Yahoo Inc. was the second largest Internet portal worldwide and the leading Internet portal in France. After Nazi-era memorabilia was posted on one of its English-language auction sites, the company was ordered under a French law to block access to neo-Nazi content. Yahoo filed a countersuit, alleging that compliance would violate free speech, as guaranteed under U.S. and international laws. Angered by the company's response, survivors of the Holocaust charged the chief executive officer with war crimes, for supporting the atrocities of the Nazi regime through its Web site. The borderless nature of the Internet raises many issues for the company: conflicting laws and cultures of other countries, differing views on freedom of speech and suppression of objectionable material, ethical considerations and the impact of extraterritoriality.

Teaching Note: 8B02C51 (8 pages)
Industry: Information, Media & Telecommunications
Issues: Competitiveness; International Law; Ethical Issues; International Business; Northeastern
Difficulty: 4 - Undergraduate/MBA