(9) You are the CEO of a baked-goods plant located in
the South Bronx. You have gotten into the doughnut business and
your marketing VP suggests using a brand name that suggests that
the doughnuts are made in the old fashioned way. She suggests
using the brand name, "Grandma's Old-Fashioned Bakery" to evoke the
image of a simple bakery using wholesome ingredients. What should
you do?
(10) You are Chairman of the Board of a fairly
successful company. Many of the shareholders have been complaining
about excessive compensation for the CEO of your firm, especially
since employee wages are very low. They cite a statement by Warren
Buffett that "the ability of corporations to rein in skyrocketing
CEO pay is the 'acid test' of corporate governance reform." You
find that the CEO earns $22 million a year and the lowest paid
worker in the company earns $22,000. This ratio of 1000:1
seems a bit high to you. A recent study published by the Economic
Policy Institute indicated that CEOs at large firms in the United
States make about 300 times more than the typical worker. Other
members of the Board feel that since the stock has been going up,
the salary for the CEO should be raised. What should you
do?
(11) You are Chairman of the Board of a successful
technology firm. There is a nominal federal corporate tax rate of
35 percent, yet the effective tax rate of the typical corporation
is about 12.6%. Your firm has been clever with use of
transfer pricing and keeping money abroad and has barely paid any
taxes over the last 5 years; during this same time period, profits
were $28 billion. One member of the board feels that it is
un-American to use various accounting devices in order to avoid
paying taxes. Others feel that these are legal loopholes and
corporations have a fiduciary responsibility to minimize taxes. One
board member quoted what the CEO of Exxon once said: "I'm not
a U.S. company and I don't make decisions based on what's good for
the U.S." What should you do?
(12) You are CEO of a small company that manufactures sophisticated drones. Your company's drones are used for non-military purposes such as fighting wildfires, monitoring borders, aerial photography, and law enforcement (finding criminals). You have just received a huge order worth millions of dollars from a firm located in a country ruled by a vicious dictator. This dictator has been known to suppress human rights and has been waging a war against a group fighting for democracy. In the past, he has even used chlorine gas against his own people. The company assures you that the drones will not be used for military purposes. You suspect that the company is a front for the government and may modify the drones as weapons so that they can be used to target freedom fighters and terrorize civilians throughout the country. What should you do?
Answer: 9
(9) You are the CEO of a baked-goods plant located in the South Bronx. You have...
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