 Ethics in Corporate America By: Katie, Catherine, Alexander, Emery, and Michael

 Unethical Workplace Romance

What is Workplace Romance?

Unethical Romance Effects on the Workplace Include: - Loss of interest - Misunderstandings - Misguided decision-making - Tension - Division

The McCourt’s

Jamie McCourt -Accused of affair with her driver -Fired as CEO of Dodgers -Over $20 million in legal costs

Frank McCourt - Paid $130 million in settlement costs to keep ownership of Dodgers - Gave three properties (estimated $50 million value) to Jamie in settlement - Forced by MLB to sell the Dodgers this Spring in order to cover incurred debts

The Dodgers -Negative press -Loss of sales -Cuts in team salary -Inability to sign free agents -Inability to resign players -Turmoil in front office

Ethics & Advertising  Ethics in advertising impacts both the consumer and the company

A Case Study: Airborne  Dietary Supplement  Created by a School Teacher  Claimed it was a “Miracle Cold Buster”  Said to “Get Rid of Colds in 1 Hour”  Company had no Credible Evidence to Support it’s Claims

Consequences  Class Act Law Suit of $23.3 Million  Reputation

What They Could Have Done Establish their credibility by: - Creating a Credo -Making a Company Code of Conduct Like....

 Enron: The Cost of Cleverness

Background  Merger of pipeline companies (1985)  Deregulation of electrical power markets  Shift from “energy delivery” to “energy broker”  Increased volatility of natural gas prices

Special Purpose Vehicles  Pseudo-partnerships  Exaggerate earnings and hide debt  Conflicts of interest

Culture  “Win-at-all costs”  “Rank and yank”

Top-down Ethics  Attention  Reaction to crisis  Role modeling  Allocation of rewards  Criteria of selection and dismissal

 The Blackwater Scandal

March 31, 2004  4 Blackwater USA security personnel were escorting 3 flatbed trucks to pick up kitchen supplies for the US Army.  They had no mission prep time, rear gunners, map of the area, or heavy machine guns. They road in unarmored SUVs.  Once in Fallujah, their convoy came to a halt in heavy traffic. There the two SUVs were ambushed from behind. Because they had no rear gunner and no heavy machine guns, they did not see the ambush coming and were left to defend themselves with only their M4s.

Videos and pictures of the aftermath led to what is now referred to as the First Battle for Fallujah, a movement led by the US Army and Marines to retake the city. The intensity of the siege and the number of Iraqi civilians killed led to building resentment against US troops, who did not distinguish between soldiers and civilian security contractors.

Part of the bridge where the burnt bodies of the four Blackwater guards were hung after US Marines retook the bridge.

Conclusion  When Blackwater tried to hide documents pertaining to the mission, the family members of those killed finally sued Blackwater for the documents.  Blackwater tried to say that the documents were classified by the government when they were not.  As a result of this incident Blackwater has lost many of their contracts and have changed their name several times to distance themselves from the incident.

 Sweatshops

 Harsh Environments -Blocked Fire exits -Unsanitary Bathrooms  Harassments  Low payment  Armed Guards  Human trafficking  Long hours

GAP

Consequences  Bad public image  Court settlements and legal fees  Public uproar

Work Cited all-time/ End to End Consulting. GE's Vitality Curve. Digital image. The Organisation as an Organism. End to End Consulting, Web. 8 Feb Healy, Paul M. and Krishna G. Palepu. "The Fall of Enron.” Journal of Economic Perspectives (2003): Document. Sims, Ronald R. and Johannes Brinkmann. "Enron Ethics (Or: Culture Matters More than Codes)." Journal of Business Ethics (2003): Document settlement