Case 3 Lecture Notes
Monsanto Balances the Interests of Multiple Stakeholders
Teaching Overview
This case deals with the ethical implications involved in producing and selling a product with
unknown health and environmental side effects. Monsanto claims that its products are safe, even
beneficial for society. However, critics are not convinced. A major issue in this case pertains to
the debate over whether genetically modified plants and substances (milk) are safe both for the
environment and for human consumption. Other issues Monsanto faces have to do with
intellectual property and patent protection, and the question of whether seeds can be proprietary
goods. Traditionally, farmers save seeds from one year to plant in the next year, but Monsanto
wants introduce a “kill gene” to force farmers to purchase new seeds from the company every
year. The case also covers Monsanto’s long history of ethical misconduct, including instances of
hiding illegal pollution and taking bribes. Finally the case goes on to cover Monsanto’s corporate
responsibility initiatives, charitable giving, and how its genetically modified seeds may actually
help farmers in less developed countries. The case concludes by asserting that Monsanto claims
to have realized the errors of its ways and is on the path to greater corporate responsibility in the
future. The question to students remains: Do they believe Monsanto, or is it just lip service to
avoid further criticism?
SWOT Analysis
Internal Strengths
• World’s largest seed company
• Known specialist in biotechnology with huge worldwide market share
• Patented seed technology
consumer markets
Internal Weaknesses
• Known reputation for creating environmental problems in the past
External Opportunities
• Continuing shortages of food and inefficient food production in many lesser developed
• FDA maintains posture that biotech crops are safe
Case 3 Lecture Notes
Monsanto Balances the Interests of Multiple Stakeholders
External Threats
• Unknown potential health and environmental effects from genetically modified food
Problem/Decision Statement
This is a very complex and contentious case, and students should be encouraged to conduct
further research at Monsanto’s website (www.monsanto.com). Students should find the exercise
Strategy Alternatives/Recommendations
This case does not necessarily pose a challenge or dilemma to be solved by offering strategic
solutions. Instead, the case is designed to promote discussion on a number of fronts. The overall
theme should be gauging Monsanto’s true dedication to ethical and socially responsible business,
and how to best alleviate stakeholder concerns. Three potential avenues for fruitful discussion
include:
1. Charitable Donations—Many students will note that Monsanto’s philanthropic efforts are
anemic at best. The average small business in the United States contributes roughly 6
Case 3 Lecture Notes
Monsanto Balances the Interests of Multiple Stakeholders
© 2014 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
introduced in this case, and whether they think they offer advantages and hope to farmers.
Is it problematic that farmers have become dependent on Monsanto for their seeds,
pesticides, and herbicides? Or do they think there are better solutions out there? The case
touches on the growing importance of organic farming, which purports to be a more
thoughtful, sustainable solution to food problems that takes care of the land instead of
maximizing output. Students can discuss the pros and cons of Monsanto’s products, and
what they think the long-term costs to people, animals, and society will be.
Teaching Questions
1. If you were Monsanto’s CEO, how would you best balance the conflicting needs of the
variety of stakeholder groups that Monsanto must successfully engage?
Students will provide a variety of answers to this question. However, most will probably
2. Companies, like Monsanto, that can offer technology to improve human lives are often
said to have a moral obligation to society. How can Monsanto best fulfill this moral
obligation while also protecting society and the environment from the potential negative
consequences of its products?
While this is a difficult question, parallels can be drawn with the pharmaceutical industry.
Most research-based pharmaceutical companies give away their medicines to people who
3. Monsanto has developed a differentiated, patent-protected product that produces superior
yields when compared to traditional seeds. How has this successful marketing strategy
been impacted by the potential negative side effects and the potential negative
environmental impact of genetically modified seeds?
Case 3 Lecture Notes
Monsanto Balances the Interests of Multiple Stakeholders
One way to approach this question is to make comparisons with other products. In other
words, how are Monsanto’s seeds any different than other patent-protected products?
4. What can Monsanto do to alleviate stakeholder concerns? How could these actions be
woven into the marketing strategy for the company’s products?
The answer for Monsanto is simple: trust. Students will argue that Monsanto’s past lapses