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University Geneva Business School (GBS)
Subject Business Administration

Part 1:  Essay.  Explain comprehensively by providing introduction, body, and conclusion for each question

Questions

1. Finally, the ends-based tradition serves to remind that, good intentions aside, good ethical decisions require a consideration of the consequences of an action. One can use this dimension of analysis as a manager to evaluate how one’s decisions align with one’s goals. Explain the essence of Corporate Social Responsibility (CSR) and why it serves as an emerging strategy across today’s organizations. Cite an organization doing CSR and how such a program becomes strategic action for them.

2. Ethics is about human welfare, both our own and that of others. Ethics in this sense includes not only an imperative to not inflict harm upon others, but also entails a prescription for excellence. Explain at least three benefits of conducting Corporate Social Responsibility (CSR) in today’s world. Also, justify why cause-related marketing serves as a powerful tool of organizations to reach appreciation from the customers.

3. Business and ethics are necessarily linked – all businesses allocate harms and benefits for stakeholders, take actions that both express and shape their character, and observe certain standards of conduct. In this light, explain why the triple bottom line perspective supports the CSR programs and how it protects the interests of many. Give examples to support your answer.

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Part 2:  Case.  Answer as comprehensively as you can.  Provide introduction, body, and conclusion for each question 

Ethical Issues

John Smith is a sales manager for XYZ Company, a building supplies manufacturer.  Because John is a manager, he has more freedom than some other employees. Part of John’s job is to take potential customers out to lunch and try to get them to purchase XYZ’s products as well as attend Trade Shows out of town several days each month.  John manages 5 sales representatives.

This is part of XYZ’s Company Policy Manual:

1. Employees are authorized to use the XYZ Company credit card when taking potential customers out for lunch or dinner or paying for gasoline while away from the city on XYZ company business.

2. Employees are authorized to use the XYZ company credit card for flights (business class), hotels, rental car (mid-size), and dining (200dhs per day) while the employees are away on official XYZ Company business.

3. Employees are not allowed to use the internet for personal use during working hours.

4. All employees are required to swipe their ID card when he/she arrives and when he/she leaves the office for safety reasons (so the company knows who is in or out of the office in case of fire or other emergencies).

5. John is currently in a country for a contractor’s trade show.  He is using his company credit card to pay for his stay at the Ritz Carlton (5-star).  He told his boss that all 4-star hotels in Doha were booked because of the trade show.  Actually, there were several 4-star hotels John could have stayed at, but they were much farther away from the trade show site than the Ritz Carlton.

6. While at the trade show, John takes out 2 men from a construction company to try to get them to purchase supplies from XYZ Company.  Before he leaves the restaurant, John ordered a “take-away” dessert to eat in his hotel room.  John pays for the food with the company credit card.

7. The next day, John goes out to dinner with newly met friends at the hotel swimming pool.  He pays for dinner with the company credit card.

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8. On the last day of the trade show, John calls the XYZ Company HR Department and leaves a message saying he is sick and would not be coming back into the office for the next 2 days.  John is not really sick; he just wants to spend more time with some people he has met earlier with whom he wants to personally bond.

9. The next week, John returns to the XYZ Company office telling everyone how sick he had been over the past few days.  At 8 am, John calls Omar into his office and promises Omar an extra day off if he rushes to complete an important project by the next day. Omar works late into the night and finishes the project at 4 am.

10. The next morning, Omar tells John that he would like to take the Thursday off.  John responds “No, you can’t have an extra day off – we have too much work to do.”

11. John calls a meeting of his staff and asks for suggestions on how to increase sales of the XYZ gold-colored doorknobs.  Mansoor tells John that the gold-colored doorknobs are not selling well because they are of lesser quality than the silver-colored doorknobs and cost twice as much.  John says, “Mansoor, you are just being a baby.  Obviously, you are not working as hard as the rest of your team.  You are letting everyone down.”

12. They go around the table with each member of the team giving their ideas for increasing sales of the gold-colored doorknobs.  When Alia starts to tell her idea, John crosses his arms, sighs loudly, and rolls his eyes.  After Alia is done, he dismisses the team but asks Mansoor to stay behind.  John threatens to fire Mansoor unless he sells 500 of the gold-colored doorknobs by the end of the month.  John says he knows the gold-colored doorknobs are inferior (not as good) as the silver-colored doorknobs, but he does not care.

13. After the meeting, John gets on his computer and does some shopping for a present to send to the new friends he met earlier at the swimming pool.  He spends the next 2 hours surfing the net, looking for the perfect gift.  He then uses his office phone to call his new friends to let them know that a gift will be arriving soon.

14. Later, John reviews the project report that Omar had given him.  John removes Omar’s name from the report and types in his own name.  John forwards the report to the Regional Sales Manager (John’s boss) with the following note, “Here is the report I prepared for you.  Let me know what you think.”

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Guide Questions

1. Point out specific behaviors that involve ethical issues. Explain why these behaviors are or are not ethical workplace behaviors

2. How do the principles of CSR apply in the case? Explain by giving facts, examples from the case to justify your standpoint.

Part 3:  Case.  Answer as comprehensively as you can.  Provide introduction, body, and conclusion for each question

1. The pharmaceutical giant GlaxoSmithKline (GSK) has been accused by police of a massive bribery network run with travel agencies that were used to funnel $450 million to doctors, hospitals, and officials since 2007.

2. An anonymous tipster sent emails and documents to a newspaper, which showed sales staff bribing doctors with speaking fees and lavish gifts like Rolex watches if they prescribed GSK’s products. GSK currently spends $82 million a year paying doctors to speak at or attend conferences. GSK is even accused of organizing fake conferences to account for the money.

3. The investigation against GSK was announced last week and four senior GSK executives are being held for “serious economic crimes” and the head of GSK’s operations recently left the country. His departure coincided with a number of investigations of the company’s offices.

4. Five months after the investigation, GSK announced that it will stop paying doctors for promoting its drugs and stop having targets for its marketing staff — a first for an industry battling scandals over its sales practices, and a challenge for other pharmaceutical companies to follow suit.  Britain’s biggest drugmaker also said it is addressing conflicts of interest that could put commercial interests ahead of the best outcome for patients.

5. In the United States, the industry’s biggest market by far, many companies have run into conflicts over improper sales tactics and GSK reached a record $3-billion settlement with the U.S. government last year over charges that it provided misleading information on certain drugs.

6. “I think other companies will follow suit, but one of the biggest problems is that the industry persists in regulating itself,” he said. “The only way to properly control promotion is strong and enforced regulation by the state.”

7. The decision to stop payments to doctors for speaking about medicines during meetings with other prescribers marks a big shift for a global industry that has always relied heavily on the influence of experts in promoting products.

Questions

1. Discuss at least two important concerns related to unethical practices in GSK. If you were to apply the Principles of CSR, what could be the most appropriate principle that can be discussed?

2. Discuss how the company involved in the case can promote Cause-Related Marketing (CRM). How can such strategic CRM affect the company’s rebranding efforts?

3. If you were the CEO of the company, draw strategic recommendations on how the two concerns in question 2 can be addressed without sacrificing ethics. Be specific with your recommendations.

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