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Chapter 10 - Making It Stick: Doing What’s Right in a Competitive Market
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10.2 – Nestlé Water: A Crisis Profiteer?
1. Is this issue being blown out of proportion? Why or why not?
2. Does Nestlé bear any responsibility for not notifying the Forest Service about the expired
permit? Why or why not?
3. If Governor Jerry Brown had included water bottling plants in his water reduction plans, do
you think Nestlé would have agreed? Explain your answer.
4. Find two other examples of Nestlé’s poor reputation on ethical conduct. What could Time
Brown do differently here to help to restore faith and trust in the brand?
Students’ answers may vary. Here are some other examples of the company’s unethical
Chapter 10 - Making It Stick: Doing What’s Right in a Competitive Market
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Frontline Focus
You Scratch My Back—Adam Makes a Decision Questions
1. What do you think the reaction of Adam’s regional manager was to the initial news of the
loss of Dr. Green’s business?
Students’ answers will vary. Any supervisor would first react with shock and a
2. Do you think Zach’s company supported his willingness to provide Dr. Green’s “marketing
funds”?
3. What do you think will happen to Zach and Dr. Green now?
Key Terms
Ethics Officer: A senior executive responsible for monitoring the ethical performance of the
organization both internally and externally.
Organizational Integrity: A characteristic of publicly committing to the highest professional
standards and sticking to that commitment.
Proactive Ethical Policies: Policies that result when the company develops a clear sense of what
it stands for as an ethical organization.
Reactive Ethical Policies: Policies that result when organizations are driven by events and/or
fear of future events.
Chapter 10 - Making It Stick: Doing What’s Right in a Competitive Market
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Sustainable Ethics: Ethical behavior that persists long after the latest public scandal or the latest
management buzzword.
Transparency: A characteristic of an organization that maintains open and honest
communications with all stakeholders.
Review Questions
NOTE: Some questions allow for a number of different answers. Below are some suggestions.
1. You have been asked to join a team as a representative of your department. The team has
been tasked with the development of an ethics training program to support the company’s
new code of ethics. What would your recommendations be?
Students’ responses will vary. Since the code can’t capture every possible example, each
2. Your company wrote its code of ethics in 1986. You have been assigned to a team that has
been tasked with updating the code to make it more representative of current business ethics
issues like the Internet and modern business technology. What are your recommendations?
Students’ responses will vary. Continued growth of technology will present situations where
3. Does the role of an ethics officer bring real value to an organization, or is it just “window
dressing” to make the company look good?
Chapter 10 - Making It Stick: Doing What’s Right in a Competitive Market
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Students’ responses will vary. The role of an ethics officer should not be ridiculed or taken
4. Do you think you could be an ethics officer? Why or why not?
5. When you go shopping, do you pay attention to how transparent the company is in its
business practices? Why or why not?
6. Would organizational integrity make a difference in your loyalty to a company? Why or
why not?
Students’ responses will vary. Most students would agree that organizational integrity makes
Review Exercises
1. Which ethical theories could be applied here?
Students’ responses will vary. Organizational integrity, which is a characteristic of publicly
committing to the highest professional standards and sticking to that commitment, can be
Chapter 10 - Making It Stick: Doing What’s Right in a Competitive Market
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company develops a clear sense of what it stands for as an ethical organization—not only
2. When Brad took his complaint to the local media, a spokesperson for the city finance office
pointed out that the city’s property taxes were paying for the emergency services that were
currently working overtime to help everyone impacted by the storm. Is that an ethical
argument? Why or why not?
3. If you were in Brad’s situation, how would you react?
4. How would you resolve the situation?
Internet Exercises
1. Review the commitment of the Charity Commission (the regulator for charities in England
and Wales) at https://www.gov.uk/government/organisations/charity-commission/about.
a. What are the stated priorities of the commission?
b. What guidance does the commission offer in managing a conflict of interest?
Chapter 10 - Making It Stick: Doing What’s Right in a Competitive Market
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Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
The commission offers publication CC29: Conflicts of Interest: a guide for charity
trustees
(https://www.gov.uk/government/publications/conflicts-of-interest-a-guide-for-
charity-trustees-cc29)
c. What guidance does the commission offer for the role of a trustee?
2. Review the website of the United States Department of Justice (DOJ) at
https://www.justice.gov/oip/government-transparency
a. What was the message of President Obama’s FOIA Memorandum?
b. What are the three principles of the Open Government Directive?
c. Select and summarize three example initiatives of how transparency is being promoted
across the government.
Chapter 10 - Making It Stick: Doing What’s Right in a Competitive Market
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Team Exercises
1. A different Massey Energy.
Divide into two teams. One team must defend the decision made in the lawsuit against Don
Blankenship from Massey Energy. The other team must critique the decision and come up
with an alternative resolution to the mine explosions.
2. An ethics charter.
Divide into groups of three or four. Each group develops a charter that documents its
company’s commitment to ethical behavior. What industry is your company in? What does
ethical behavior look like in that industry? What will your company’s commitment consist
of? A code of ethics? Performance guarantees? Corporate governance policies?
Chapter 10 - Making It Stick: Doing What’s Right in a Competitive Market
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Thinking Critically
10.1 – Mott’s: Sour Apples
1. When you consider Milton Friedman’s position on corporate responsibility in Chapter 4, is it
possible to defend DPS’s demand for lower hourly wages?
Students’ responses will vary. Milton Friedman’s position on corporate responsibility states
2. Was DPS considering the interests of all stakeholders in this battle? Explain why or why
not?
Students’ responses will vary. Some may answer that DPS was considering the interests of
3. How could senior executives have approached this situation differently?
4. Both sides claimed in media interviews that they had won their case. Was there victory here?
Explain why or why not.
Chapter 10 - Making It Stick: Doing What’s Right in a Competitive Market
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Copyright © 2018 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill
Education.
workers would be offered 401(k) plans instead of pensions. Students may answer that
nobody won the case as neither side will be happy with what they got. They may answer that
there was compromise in this case.
10.2 – The Failed Transformation of BP
1. What evidence is there in this case that BP simply addresses fines “as a cost of doing
business”?
2. BP chief executive Tony Hayward argued that “changing the culture of a 100,000 person
company couldn’t happen overnight.” He had been in charge for three years before the
Deepwater Horizon spill. Were critics right to expect more change than they saw?
3. Has BP been successful in its move “Beyond Petroleum”?
4. How can BP begin to restore its reputation going forward?
