Case Study 2: Bayer and Monsanto: Acquiring a Global Giant with a Giant Image
Problem
Written by Asbjorn Osland, George Whaley, and Denis Collins
Case Summary
The case explores was a large German
company that enjoyed a solid reputation and was seeking to expand its business in the crop
science division. Monsanto was the largest supplier of seeds in the world and was well-known
The main issue surrounding Monsanto is related to GMOs controversy. GMOs are legal
in the U.S. and around the world, but Monsanto had pushed GMOs on consumers without
disclosing which foods contain GMOs, which led to public criticism. GMOs are thought not to
harm consumers in the food they ingest either directly as grains, vegetables, or fruits, or
Monsanto has tried to defeat legislative bills and ballot proposals that required labeling of
foods containing GMOs. Nonetheless, in 2016, the U.S. federal government passed a GMO
labeling law. By the time, roughly three quarters of the food in the U.S. was estimated to contain
GMO and the U.S. Food and Drug Administration believed such food was safe.
Another controversy referred to Monsanto property rights and the fact that the company
patented its GMO seeds and prohibited farmers to replant seeds sold by the company. Farmers
Case Analysis
The mandates of ethical leadership are broad. Monsanto has perhaps overused the conventional
and Monsanto has won most court battles over the use and reuse of GMO seeds. If Monsanto
Critical Thinking Questions and Suggested Answers
1. If you were the CEO of Monsanto, how would you have implemented an
integrated strategy that would satisfy the needs of most stakeholders?
As a minimum, Monsanto should conduct a thorough stakeholder analysis and develop
proactive strategies for key stakeholders. One effective strategic approach is
environmental scanning to understand the goals and actions of its key stakeholders or
States, Monsanto could learn from this experience that its opposition was for naught.
Other opponents include environmentalists who question the use of agrochemicals
because of their impact on bees, butterflies, waterways, and so forth. Monsanto could
2. What is an effective reputation management strategy that Monsanto could have
used to reverse its public image as the most evil company in the world?
Both reactive (makeover) approaches and proactive (collaborative) approaches have
helped organizations to improve their reputations. For years, Monsanto had not
undertaken any strategic reforms but instead had employed a public relations
Examples could come from makeover steps taken by tobacco companies or any
other company trying to dig itself out of a reputational problem. For Monsanto,
recognizing its image problem and hiring a PR firm were hardly enough. It should
have employed proactive strategies. The general recommended PR approach involved
image. Part of this was an educational problem, but there were also many scientists
and agricultural experts who wanted agriculture to be more oriented to preserving
biodiversity than maximizing yields through massive expanses of monocultures of
corn, soybeans, cotton, or other GMO crops.
negative public image. The expanded use of social media to find and engage with new
publics and communications sources is one proactive, technology approach to deal
3. What should Monsanto have done about India?
requests but did not want to accept
the 70% cut in cotton royalties ordered by the government. It hoped that the courts
4. Do you regard GMOs as safe? We are told they are, but has enough research
been done? If Europe is so suspect of GMOs, why should the United States be so
complacent?
Scientists and governmental officials in the United States have asserted that GMOs are
safe. Product safety supported by credible research needs to be a continued part of
PR efforts. As pointed out in the case, the public pays
5. Even if GMOs are safe, the methods used by industrial agriculture have harmful
side effects such as creating super weeds, hurting butterfly and bee populations,
and contributing to run-off of agricultural chemicals that pollute waterways and
harm downstream wetlands, to name a few concerns. Could the world produce
enough food to feed the projected increase in population using ecologically
sensitive methods?
African nations have been reluctant to embrace GMO technologies but will likely face
a food shortage due to population increases and climate change making cultivation
6. If you were a Bayer executive, would you have acquired Monsanto? If yes, what strategies
Some students will answer that Bayer should have not acquired Monsanto given Monsanto
inherited liability and negative publicity. Several financial analysts classified the $63
Roundup safety1
declined over 40% since the acquisition of Monsanto2. Other students may argue that the
ty for Bayer to explore new and innovative
business opportunities with a of focus on agriculture. In this case, Bayer could engage in