Case Study.

Fall 2016 MGMT4308CASE STUDY PROJECT ONE INSTRUCTIONS
“The CEO Who Saved a Life and Lost His Job”
http://www.bloomberg.com/news/articles/2015-01-22/biotech-drug-approvals-social-media-storm-hits-

chimerix
Project Tasks
Please write an 8-10 pages’ long essay analyzing and discussing the following topics.
1. Task 1 (20 points): Summarize the case and identify (list) the ethical issues that have

arisen in this case. Please offer some details about each ethical issues (e.g. including what’s

occurred, who’s affected, etc.). Length suggestion: 2 pages.
2. Task 2 (20 points): Identify (list) all of the stakeholders of the company (i.e., Chimerix)

in the case, and discuss each of their viewpoints (e.g., needs, desires, concerns, costs, benefits,

power, etc.). Length suggestion: 1-2 pages.
3. Task 3 (20 points): Explain in detail which of the stakeholders should be involved and

helpful to solve the ethical issues that have arisen in the case, and why, given their viewpoints.

Length suggestion: 1-2 pages.
4. Task 4 (20 points): List all of the ethical theories and principles (i.e., 14 ethical

principles under the part “Principles of ethical conduct” from Page 241 in Chapter 8 of the

textbook) that are appropriate for solving the ethical issues in this case. Explain in detail why

each principle is appropriate for solving the particular ethical issue. Length suggestion: 2 pages.

http://energy.gov/hc/ethics-fourteen-principles-ethical-conduct-federal-employees
5. Task 5 (20 points): Using certain ethical approaches to recommend a plan of action for the

company that will help the company (i.e., Chimerix) remain competitive and avoid such problems in

the future. Explain the expected positive and negative consequences of the plan of action you

recommend. Length suggestion: 2 pages.
Guideline and Requirement
1. The length of your essay is about 8-10 pages (double-spaced, 12 pt “Times New Roman” font,

1-inch margins, excluding exhibits and references) in MS Word format.
2. Submission deadlines:
3. Before you start, read the instructions and the case twice. You should also read the four

files for instructions and learning materials for Module 5’s case discussion. They are included in

the project one folder too.
3. You should not conduct outside research for the case analysis. In other words, you should

pretend that you are facing exactly the same situation and information presented in the case.
4. Your answer should be specific to the five tasks specified above and follow the order to

organize your analysis. Please keep in mind that those topics are actually interconnected. You need

to integrate your answers into a report with smooth logic and internal consistency.
5. The analysis must be professionally written. Don’t use bullet or lists. Write your answers

in complete sentences. Please conduct spelling check, grammar check, and virus-check before

submission.
6. Avoid laundry lists. Focus and organize your analysis. Look for frameworks from the

readings or the textbook that help you organize and present your analysis.
7. Consider ‘turning the question’ into the beginning of your answer. That is, if the question

is, “What are the key issues?” begin your answer with; “The key issues” (include or are). This may

seem simplistic, but is a very effective way to help you focus your answer on the question(s) asked

and to earn full credit. Don’t repeat the entire question in your answer.
8. You need to highlight the names of the ethical principles in your paper.
9. Please follow APA format for your writing. Indicate any references you cited in your

report. The references list does NOT count for length requirement purpose.
10. Not following instructions would result in point deduction.
Grading Standards and Rubrics
In grading your written assignments, I use the following standards.
1. Rigor of analysis: You should use the appropriate frameworks from the class that are

germane to the problem.
2. Logical consistency: Your writing should be logically consistent from the beginning to the

end.
3. Depth of analysis and practical implications: Before making your own argument, consider

alternative explanations and solutions. Then try to justify your argument or identify the

situations under which some solutions are working better than others.
4. Clarity of writing: Papers should be addressed to a managerial audience. This means that

you should outline carefully, write clearly and concisely, and use appropriate tables and graphics

to support your argument, if necessary.

Here are the four files.
File 1
1. MGMT4308 Term Project One Instructions.
WHAT MAKES A GOOD SUMMARY?
A good summarization of case (or identification of the ethical issues/dilemma):
1. answers the questions: Who? What? Where? When? Why?
2. is concise. It summarizes the key points without repeating the case.
3. uses correct business and ethics terminology.
4. is fact-filled and avoids extraneous information such as:
“I feel they should have learned to tell the truth when they were children”. Your feelings, what

the managers learned, or did not learn, and children are not
relevant facts in the case.
Things to avoid:
1. Needless verbosity, or 1001 words to say little or nothing.
2. Repeat the case verbosity, or the answers must be in there somewhere.
3. Repeat the textbook verbosity, or show the professor I have read the textbook while
writing 1001 words.
4. Off-track verbosity or I don’t know so I’ll write about something else.
5. Generality and verbosity number 1, or sort of discuss the sort of general problems,
kind of, like.
6. Taking the case too personally, or I wish I was studying psychology and feelings.
7. Making the case personal or I wish someone wrote a case about me.
8. Using overly strong language or injecting your personal beliefs.

File 2. MGMT4308 Term Project One Instructions

HOW TO DO STAKEHODER ANALYSIS
Stakeholders are those affected by an organization’s operations. Although definitions vary,

stakeholders are often designated as groups rather than as individuals. In other words, for the

sake of analysis, managers and employees are usually grouped together as stakeholder group, rather

than focusing on a particular manager or employee, although some cases will focus more on the

individuals involved. Similarly, customers or stockholders as a group are usually the focus of

analysis, rather than an individual customer or the individual stockholder.
The most important thing to remember is that most organizations have similar stakeholders such as

stockholders, customers, employees, suppliers, creditors, unions, trade associations, government

and non-governmental organizations (NGOs), taxpayers, communities, religious groups, the

environment, and even future generations may be legitimate stakeholders. It is mostly their

interest in the organization and/or their influence on the organization that changes!
In other words, when you read a case, you may not always read about all of these stakeholder groups

specifically, but that doesn’t necessarily mean they can be ignored in your analysis. A good

stakeholder analysis will consider as many current, or potential future stakeholders as possible.

For example, NGOs may not be mentioned in a particular case, but if the company decided to choose a

course of action or project that could harm the environment, NGOs whose goal is to protect the

environment are quite likely to quickly target the business.
Sometimes stakeholders are also categorized as market or non-market depending upon whether or not

they have direct business dealings with the organization, or as primary or secondary stakeholders.

These categorizations can be useful at times, but may also interfere with a good analysis if one

assumes, often incorrectly, that nonmarket or secondary are synonymous with unimportant. They are

not synonymous and such assumptions about stakeholders should be avoided.
The first goal of a good stakeholder analysis is to identify the stakeholders who have, or are

likely to have, a stake in an organization’s operations. That is, they are, or they are likely to

be affected, by an organization’s operations now or in the future.
The next step in a good stakeholder analysis is to determine the interests of each stakeholder, or

what they want and/or expect from the organization. Also, the analysis should consider when and if

the interests of different stakeholders may converge or diverge. This often leads to a greater

understanding of which stakeholder groups might choose to join together to exert influence over the

organization through coalitions or other
efforts, or to a greater understanding of which stakeholder groups might become active, if they

have been inactive.
The next step in a good stakeholder analysis is to identify the level of influence or the power of

each stakeholder group. Some groups may have economic power, others groups might have legal power,

while groups such as NGOs often have the power of moral suasion backed up by activists who can

boycott or take other actions against an organization.
In conclusion, at a minimum, a good stakeholder analysis seeks to identify who are the most

important stakeholders, what are their interests, what is there ability to influence the

organization, and what stakeholders might form alliances or coalitions, and if so, under what

circumstances. The ultimate goal in a good stakeholder analysis is to help an organization better

understand its stakeholders so that it can develop better strategies that will more likely be

supported by its stakeholders.
This is only a summary of stakeholder analysis, please be sure to read your text for more

information on stakeholder groups and stakeholder analysis. In future classes, you might also learn

more about various ways to create ‘maps’ to better analyze stakeholder groups, interests, and

powers.
1. Our textbook, “the stakeholder model” in Chapter 1;
2. Our textbook, stakeholder map in “Engaging stakeholders” in Chapter 6;
3. Supplementalreading“ProjectOne_Instructions_StakeholderTheoryoftheFirm” attached in the same

folder.

File 3.
https://elearning.uhv.edu/bbcswebdav/pid-2964130-dt-content-rid-

21312202_1/courses/V_20163_MGMT_4308_28523/Project One_F16/Case One_Instructions_Stakeholder theory

of the firm.pdf

File 4.
2. MGMT4308 Term Project One Instructions
EXAMPLES OF IDENTIFYING ETHICAL ISSUES AND REASONING
Note: At the end of Chapter 8 of the textbook (13th edition), we are given an assignment called

“short incidents for ethical reasoning”. Here some sample answers to discuss the ethical issues and

application of those ethical principles on these small cases.
You can know from the sample answers below about how the ethical issues were identified and defined

and how different ethical principles were used to analyze and solve the ethical issues. I

highlighted those principles that are cited in the sample writing. Please also highlight the

ethical principles you mention in your writing.
A Clouded Promotion
Sample Answer:
The chairman of the accounting firm must decide whether to promote, retain, or dismiss the vice

chairman who falsely claimed an M.B.A. from the University of Michigan. Four considerations

predominate.
First, what is the chairman’s attitude toward lying on an employment application? Claiming an

unearned degree was a premeditated, aggressive, manipulative lie. It deprived the firm of making a

fully informed decision among qualified applicants. It likely deprived another individual of the

job the vice chairman now holds. Most people condemn lies on resumes. Yet some employers are

charitable when the person subsequently does the job well. Different responses come from variations

in ethical values about truth telling.
Second, the past performance of the vice chairman has been excellent. How should this be weighed? A

maxim of retributive justice is that punishment should be proportionate to the crime. Only then is

it deserved. For years the vice chairman has done an outstanding job, and this performance may be a

mitigating factor.
Third, what is company policy about false statements on resumes? If lower-level employees or

applicants have been fired and rejected for falsehoods, then retaining the vice chairman suggests a

double standard. Keeping this person would cause widespread cynicism.
Finally, this is an accounting firm. Accountants follow a code of professional ethics. It is

crucial that clients perceive the firm as having integrity. If it becomes known that the company

excuses questionable behavior in senior managers, clients might worry about the conduct of audits

or other sensitive matters. This is an overriding
consideration. The story is based on an incident at the Los Angeles office of an international

accounting firm, where the vice chairman was fired after discovery of a falsified application form.
False degree claims periodically surface in the press. Examples that led to firings are mentioned

in Chapter 7 on page 225 (13th ed). Sometimes the executive survives. In 2002 the story got out

that Ronald Zarella, CEO of Bausch & Lomb, falsely claimed an MBA from New York University. He

offered to resign, but the company’s directors retained him though they took away a $1.1 million

bonus.15
The Admiral and the Thieves
Sample Answer:
In his primer on the use of power, The Prince, Ni´ccolo` Machiavelli wrote: “A prince should care

nothing for the accusation of cruelty so long as he keeps his subjects united and loyal,” and

argued that by “making a very few examples he can be more truly merciful than those who through too

much tender-heartedness allow disorders to arise.”16
When the admiral fired the three workers for a theft of materials worth $25, he acted in accord

with Machiavelli’s philosophy. The ethical principle that important ends sometimes justify harsh

means could be applied. The admiral’s aim was to achieve an important community good. The means he

chose broadcast the determination with which he intended to pursue the no-theft policy. However,

they involve manipulation of the three workers. This action might conflict with the idea in Kant’s

practical imperative, which requires that individuals be treated as ends in themselves, not as

means to other ends.
Disciplinary actions raise ethical questions. The maxim of retributive justice, that punishment

should be proportionate to the crime, is applicable. Students may feel that losing thirty years of

work toward a pension is too great a penalty for aiding in a minor theft. They could be asked what

alternatives existed and if they would have worked as well to deter future theft. Some alternatives

are these.
1. Point penalties under a point system.
2. Verbal or written reprimand.
3. Leave without pay for one or more days. A variant is an unpaid, one-day decision-making

leave, after which the employees would return and say whether they intended to be honest as a

condition of continued employment.
15. 15 Philip Walzer, “Reasons Not To Pad Your Resume,” The Virginian-Pilot, May 4, 2007, p.

D1.
16. 16 T. G. Bergin, ed., New York: Appleton-Century-Crofts, 1947, pp. 47-48. Written in 1513.
4. Reduction in rank for the petty officers.
5. A combination of these measures.
The admiral displayed an authoritarian management style and believed that the workers under his

command could be motivated by fear. As Machiavelli noted, “it is much safer to be feared than to be

loved, if one must choose.”17
Sam, Sally, and Hector
Sample Answer:
The three layoff victims have different personalities. Sam and Hector are less aggressive than

Sally and do not get the extra benefits she negotiates. Although all three workers are in the same

situation, one is treated more generously.
The maxim of distributive justice requires that rules apply equally to workers in identical

situations and that benefits or burdens be distributed equally unless a job- relevant difference

justifies differential treatment.
Sally received preferential treatment owing to force of personality, ability to express threatening

behavior, negotiating skill, or obstinate demands. Are these relevant criteria for distributing

benefits? If there was a specific company policy about layoff compensation and an exception was

made, then the maxim of distributive justice is violated unless something in the situation exists

to justify the exception. Here it can be argued that Sally has traits that are valuable in business

situations. She created a negotiation, asserted her interests, and deserved the extra reward she

got because she acted whereas others passively accepted the situation.
A Personality Test
Sample Answer:
The questions on the psychological profile test are designed to reveal personality traits in job

applicants, including abnormalities. For example, the questions about difficulty sleeping, worrying

about sexual matters, and work stress are designed to detect anxiety. The questions about

disjointed hands and strange odors are aimed at schizophrenics. The question about enjoying dancing

in junior high school suggests masculine or feminine attitudes. And the question about friends not

liking you could reveal paranoid feelings. Naturally, these questions reveal personality only when

combined with many others in a validated test.
17 Ibid., p. 48.
Psychological tests such as this may create conflicts of rights, or entitlements that people have.

Employers have the right to protect their assets and to raise efficiency by hiring the best

applicants. Applicants, on the other hand, have the right to privacy of thoughts and emotions.

Ordinarily, there is a great power imbalance in the test- taking situation. Applicants refusing

tests are likely to go no further. Lying and deception are a common reaction to unfair, overbearing

power. A job applicant lies on a test that he or she feels is intrusive but must be taken to get

the job. Is this justified?
The ends-means ethic and the conventionalist ethic can be used to rationalize faking answers to

give the appearance of a “normal” personality or show traits that the employer seeks. The important

thing, it can be reasoned, is to get the job, and to do so, expedient means are justified. The goal

of getting the job justifies some dissembling.
Lying, or the intentional misstatement of fact, is not ethical. It violates principles such as the

categorical imperative. Still, many people believe that puffery is acceptable in the application

process. They may be cheating themselves if subsequently they do not fit into the job. A question

that could be discussed, however, is this. Would deceit be justified under limited circumstances,

such as if a person were unemployed and his or her family struggling?
Al
Sample Answer:
Al the sales representative exemplifies the phenomenon of the highly successful corner-cutter. Such

people exist in every organization. Several problems surface in the performance review.
First, by giving friendship and small gifts to loading dock workers in exchange for preferential

treatment, he undermines both company policy and the formal authority of the loading dock

supervisor. Other sales reps will see this as favoritism. The supervisor will be angry. Many are

watching to see how Al is handled. If he continues to get away with this, employees will become

cynical about “how things really work around here” and will believe that other policies are made to

be broken.
Second, by giving unauthorized discounts, Al has again violated policy and this time undermined the

authority of sales management. If discounts are necessary, he should request in advance an

exception or a policy change. By not doing so, he has opened himself and other sales reps to

pressure from customers for future concessions.
Third, Al has asked one customer to participate in a lie that works to his personal benefit. Delay

of payment for one week is not a great departure from normal procedure, but people at the other

company may feel uncomfortable being recruited
into Al’s self-dealing and wonder when Al’s propensity will turn to their disadvantage.
Al’s story raises the question of whether the ends justify the means. Al is productive. Do the

benefits to the company justify his tactics? This age-old philosophical issue is worth discussing.

But for a practicing manager the answer should be no. Al’s actions are a challenge to the

seriousness of any ethics statement set forth by management. Not even the utilitarian ethic

rationalizes well what Al is doing. Benefits from Al’s high sales may be great, but is the

alternative of letting him work unchecked worth the cost in organization morale? A key

consideration is that his questionable actions are probably not necessary. He could excel without

them. Over time the destructive achiever diminishes organizational performance. Unless Al is

disciplined, his actions will spread cynicism, encouraging others to cut corners and demotivating

coworkers who follow the rules but do not get Al’s star status.
The CEO was wrong, therefore, not to take action on Al’s performance review.
A Trip to Sea World
Sample Answer:
The buyer from the retail chain asks for a favor that is financially insignificant compared with

the possible sale. According to utilitarian reasoning, there are compelling benefits to paying for

the requested $500 trip to San Diego. The company will make a $3.6 million gross profit. The

buyer’s commission will be $50,000. Major stakeholders of the company will benefit.
What costs must be weighed against these benefits? The most important one is the precedent of

permitting such a manipulation. What will the buyer want next year? Will word get around that the

manufacturer can be rolled? Paying for the trip introduces a tolerance for extortion into the

business environment. The specific ethical problem is that the buyer is using his power as a

representative of his company to intimidate the manufacturer’s sales representative and get a

personal benefit for himself and for his wife. This is abuse of authority.
How should the sales representative handle this? He stands to make $50,000 from the sale and could

pay for the San Diego trip using his personal bank account. The ethical drawback to this, however,

is that the rep is then open to future extortionate demands in matters in which the manufacturer,

his employer, has a critical interest. Therefore, a “private” bribe is wrong because it confuses

authority of the company with personal gain in a way that is analogous to the way the buyer is

confusing his authority with self-gain. He should inform the sales manager at the manufacturing

company and seek advice.
The sales manager must decide what to do. To approve the trip validates an ethical compromise.

Refusing it might kill the order, but it might not. A third option is to inform managers at the

retail chain about the buyer’s behavior.
(This story is inspired by a similar situation occurring in a large corporation. In the real-life

version the sales manager elected to inform the buyer’s superior. The buyer was fired and the

purchase went through.)
Mary and Tom
Sample Answer:
Was Tom fair to Mary? Justice requires acting equitably toward others. In this situation that means

shouldering an equal share of the burden with Mary in their joint project. Tom skimped on his

share, allowing ambition and self-interest to divert his efforts.
Tom’s promotion over Mary was inevitable. Both worked on the critical radar project, but Tom’s

resume had an additional line for the privacy task force, a project not as important to the company

but one with high visibility. Tom showed political awareness when he joined the task force,

something that is a legitimate consideration in promoting a manager. Mary showed only competence as

a technician; she did not showcase ambition and political ability as did Tom.
This kind of promotion, which appears to reward the less competent, arouses cynicism in workers who

want to see the company (and the world) as a fair place. It shows “how things really work around

here” and teaches by example. Was the promotion fair to Mary? No, if merit alone is considered. Was

the company wrong to promote Tom? Not necessarily, if both merit and political skills are

important.
Although the incident invites a focus on distributive justice, other ethical principles are useful.

Tom’s actions fail the categorical imperative’s lofty standard, since slacking off cannot be made a

universal rule. They fail the quick test of reversibility; if Tom put himself in Mary’s position,

the injustice to her would jump out. They violate the organizational ethic in which people

subordinate their interests to the overall good.
On the other hand, Tom’s actions are rationalized by ethical principles from the realist school.

These are based on worldliness, not ideals. When Tom cut corners on the radar project to get time

for the privacy meetings he followed the conventionalist ethic, which encourages self-promotion if

it does not break a law or rule. Following the ends-means ethic, he made himself a more attractive

promotion candidate at Mary’s expense.
The Honda Auction
Sample Answer:
Dennis Josleyn, zone sales manager for the West Coast, is asking Dave Conant, co- owner of a Honda

dealership, for a kickback. Josleyn has arranged for Conant to get 64 cars for $128,000 less than

their market value. He wants half that, or $64,000, returned to him, with the money laundered

through a business he owns.
This violates the categorical imperative. It would never withstand disclosure. It is a means only

to a selfish end. It contradicts the Golden Rule. The intuition of any ethical person would reject

it. It violates the organization ethic because it steals from Honda. It cannot be justified by any

weighing of proportionality. It is against the law and bends corporate policy unfairly,

contravening maxims of justice. It could be justified by utilitarianism using only the most

expedient calculus. Josleyn lacks cardinal virtues.
If Conant acts on principle, refusing the deal, he rejects a $64,000 windfall. Worse, he declares

that he is not a player. New Honda’s will flow to dealers willing to pay these kickbacks. Conant’s

dealership, his livelihood, will wither. Since the corporation will not act against rogue managers

such as Josleyn, reporting the circumstances over his head is an ineffective option.
Is there any ethical rationale for making the payoff? Aristotle’s theory of responsibility is that

an actor is responsible for his or her choices unless excused by ignorance or incapacity. Conant is

not ignorant of unsavory consequences from this payment. However, an argument that he is

incapacitated exists. He is forced to make the payment, so the reasoning goes, because if he does

not he will lose his business. He is in the same position as a corporation in a foreign land that

cannot stay in business unless it descends into bribery. Yet this argument is flawed. The kickback

is wrong and the choice not to make it exists. The cost of standing on principle may be loss of the

dealership, a very high cost. But saying that the dealer is forced to make the bribe is incorrect.

He can refuse.
A second rationalization for making the payment is in the theory of amorality, discussed in Chapter

7, which is that a separate, lower set of ethics is applicable in business. Therefore, pursuing

commerce with clean hands is impossible. Our protagonist has no choice but the kickback. Without it

he leaves the game. This result validates the theory of amorality. But it also rationalizes

unethical behavior, an end some are unwilling to accept. They accept the theory of moral unity,

holding that there is only one, high set of ethics to use in all areas of life. The dealer should

stick to these standards even if it requires starting the game over.
In the end, when Conant paid the $64,000 it was a decision wrong in principle. We can empathize.

Yet it was wrong.
(This incident was part of a much wider fraud conspiracy among managers at American Honda Motor

Company, a subsidiary of Honda Motor Company of Japan. A
corrupt hierarchy formed within the sales division. Dealers bribed district sales managers for a

better mix of cars. They bribed zone sales managers to get more car shipments and paid off regional

sales managers for new dealer franchises.
Like the dealers, people in the sales division had an ethical decision to make. Quickly they

learned that careers stalled for those who did not join the club. A few managers remained outside

the conspiracy. Their careers stagnated and they had nowhere to turn, since the highest-ranking

sales executives openly socialized new participants into the scheme. Top Japanese officials at

American Honda were warned repeatedly about the corruption, but remained aloof and secretive. Their

silence protected the gang of Americans.
After fifteen years of rampant dishonesty, from the late 1970s to the early 1990s, American Honda

finally began to root out the crooked managers when some dealers sued. In 1995, the Department of

Justice brought fraud charges against top sales division managers, including Dennis Josleyn.18

Josleyn, who admitted receiving $1.2 million in payoffs and kickbacks, was convicted of

racketeering, conspiracy, and fraud and sentenced to 61/2 years in prison. His appeal was

unsuccessful.19 Honda Motor Co. has paid more than $400 million to Honda dealers because of their

lawsuits.20)
The Tokyo Bay Steamship Company
Sample Answer:
The Tokyo Bay Steamship Company is taking advantage of the sanguinary interest of the Japanese

public in suicides to expand business. The conventionalist ethic can be used to justify the

company’s operations. It is making money in the marketplace without violating any laws. But, of

course, a business does not always benefit individuals and society simply by meeting market demand.

Meeting demand for refrigerators, automobiles, and hamburgers is beneficial. Meeting demand for

cheap handguns, video game violence, and obscene lyrics creates a mixture of good and bad and is

controversial. Meeting demand for heroin, contract murders, and machine guns subtracts from

individual and societal well-being and is wrong (and illegal). Note that if someone has ethical

values that uphold suicide as a personal decision in which society has no interest, then the

behavior of the company is rationalized.
18 United States v. John W. Billmyer, Dennis R. Josleyn, Criminal Nos. 94-029-01, 94-029-04-JD

(USCD, New Hampshire), September 26, 1995.
19. 19 United States v. Dennis R. Josleyn, 206 F.3d 144 (2000).
20. 20 In re: American Honda Motor Company, Inc., Dealerships Relations Litigation, 162

F.Supp. 2d 387
(2001).
Several ethical principles lend themselves to condemnation of the company’s actions.
1. Aristotle’s theory of responsibility is that a person or a company is responsible for

permitting harm or evil unless ignorance or incapacity prevent action. Although the Japanese

culture views suicide more charitably than American culture, the Japanese still try to prevent it.

If suicide is an evil, then it is the obligation of the company to stop it, not facilitate it. The

company cannot claim ignorance or incapacity. Therefore, it is culpable.
2. The principle of proportionality invites reasoning that also leads to condemnation of the

volcano tours. Suicide is a major evil involving the loss of life without proportionate,

compensating social benefit. The harm to persons here outweighs the benefits for curious tourists

and stockholders. There is no evidence that the company would fail if it declined suicide-related

business. It is certain that evil effects will accompany the island business (in part because

efforts to stop the suicides are only partly effective). And the company has influence over these

evil effects because it provides transportation for the suicides.
3. The practical imperative can also be applied. It admonishes that people be treated as ends

in themselves, not as objects of manipulation for the selfish ends of others. The Tokyo Bay

Steamship Company is using suicidal individuals to build its revenues. They could be carried as

“goodwill” on its balance sheet. The practical imperative, however, teaches that the company should

be working to help individuals, not to assist self-destruction.
Tiger Woods
Sample Answer:
Tiger Woods displayed lack of integrity toward his family. The resulting global scandal reduced,

but did not eliminate his value for endorsing products. His main sponsors are corporations with

formal codes of conduct. None of these codes directly mention the conduct of celebrity endorsers.
Students can research the conduct codes of the companies mentioned in the short incident and

examine closely the wording to see if it does or should apply to Tiger Woods. Almost every code has

a general statement about integrity. None of these company codes try to regulate or penalize off-

work behavior (with the exception of criminal activity). Some codes, such as Nike’s, expect

employees to avoid seemingly any behavior that tarnishes the company’s reputation. Nike’s code

applied to “every employee.” The company may have rationalized that Tiger Woods was not technically

an employee.
Should these companies have extended the rules for their employees to cover Tiger Woods? It seems

reasonable to argue yes. A corporation with a double standard for employees and product endorsers

is open to criticism. There are, however, other arguments. One is that profits should have priority

over ethics. Another is that the codes do not literally apply to the personal lives of people

connected to, but not employed by, the corporation.

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