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Homework 4

1. Are information gathering techniques like Rajaratnam common on Wall Street? If


so, what could regulators, investors, and executives do to reduce the practice?

Information gathering techniques like what Rajaratnam was doing is common on Wall
Street. Business people at Wall Street are in business to make money. Rajaratnam did
not have a sense of checks and balances. What regulators, investors, and executives
can separate those jobs out to make sure there is less of these practices. Raj was
president, fund manager, and the stock analyst. I think the government should set strict
laws requiring firms to have robust compliance, supervisory, surveillance, and control
measures in place to detect possible illegal insider trading. Overall, insider trading is
illegal, but for some reason business people sometimes are so greedy they let it
interfere with their work. They lose sight of whats right and whats wrong. Egoists
believe they should make decisions that maximize their own self- interest (Ferrell,
2015). No doubt, insider trading and other white-collar crime are going to continue to
happen.
2. What are the implications of sharing confidential material information? Is it something
that would affect your decisions about how to trade a stake if you knew about it?
If I were to be informed of insider information, I would try to take my chances in being
ethical, legal, and appropriate as I should be. I would want my colleagues, employees,
and investors and anyone else involved to fully understand the culture in which my
business decisions are run especially ethically. It would still be difficult to not make a
decision based on insider information. Overall I would hope that I am never approached
with the information.(Ferrell, 2015)

3. Do you think the secret investigation and conviction of Rajaratnam and other people
in the Galleon network will deter other fund managers and investors from sharing
nonpublic information?
No, as I said before in the first question, there has been insider trade fraud going on at a
rapid rate. I think with the findings from this case, many insiders will try to filter out
suspicious persons and pay closer attention to their business surroundings as well as
whos all involved in their circle of trust. (Ferrell, 2015)
Ferrell, F. (2015). Business Ethics. In F. Ferrell, Business Ethics (pp.517-523). Samford:
Cengage Learning.

Watch the Instructional Video "The Great Handbag Hoax" found at


http://danielsethics.mgt.unm.edu/videos/ethics-instructional-videos.asp (Links to an
external site.)
Discuss the issues posed in the video.
The Handbag Hoax is a perfect example of being unethical. The lady in the video does
not have a strong Moral philosophy and is hurting the system. Moral philosophy refers
to the specific principles or values people use to decide what is right and wrong.
(Ferrell, 2015) By lying and over using company time she is being unethical and
abusing the system. Overall she has wasted company time and lied about what she is
doing, this is unethical and hurts the business.

Ferrell, F. (2015). Business Ethics. In F. Ferrell, Business Ethics (pp.154-155). Samford:


Cengage Learning.

Read "Case 5: New Belgium Brewing: Ethical and Environmental Responsibility" on pp.
434-442.
Answer the questions at the end of the case.
What environmental issues does the New Belgium Brewing company work to address?
How has NBB taken a strategic approach to addressing these issues? Why do you think
the company has taken such a strong stance towards sustainability?

The biggest environmental issue that NBB has taken into account was the size of the
footprint that they are leaving on the environment and how much energy they are using.
NBB has continued to take steps in order to reduce their needs. NBB has a smart grid
which allows them to monitor energy usage and identify areas in which they can reduce
or turn off the power. NBB installed a 20kW photovoltaic array which provides 3% of the
companys overall energy. There is a special brew kettle that conserves energy and is
only the second of its kind in the United States. Sun tubes provide natural light and
reduce the need to provide additional lighting, they have a system that captures
methane and provides them with additional energy while reducing the burden on the
local water treatment facility, and they also have a steam condenser which recycles
water from one process to another. NBB have taken this stance because they want to
be seen as environmentally friendly. Also, they want to increase their profits overall.
(Ferrell, 2015)

2. Do you agree that New Belgiums focus on social responsibility provides a key
competitive advantage for the company? Why or why not?

I think that it does provide them an advantage for the company because it is going to
give their company a good name and ultimately save them money. Since they are so
involved in socially responsible activities they are able to put their NBB name out there
where it normally wouldnt be seen. This overall provides a competitive advantage to
other companies. (Ferrell, 2015)
3. Some segments of society contend that companies that sell alcoholic beverages and
tobacco products cannot be socially responsible organizations because of the nature of
their primary products. Do you believe New Belgiums actions and initiatives are
indicative of a socially responsible corporation? Why or why not?

NBBs actions are socially responsible even though the product they produce is not that
socially respected. Although NBB has made great strides in creating a socially
responsible brand image, its work is not done, New Belgium received the Environmental
Protection Agency's regional Environmental Achievement Award. It was both an honor
and a motivator for the company to continue its socially responsible goals. After all,
there are still many ways for NBB to improve as a corporate citizen. There are always
pros and cons on this issue because of the product that is being produced, but still I
believe that NBB's actions and initiatives are indicative of a socially responsible
corporation because the company donates to cause with a particular emphasis on water
conservation, sensible transportation and bike advocacy, sustainable agriculture, and
youth environmental education, among other areas. (Ferrell, 2015)

Ferrell, F. (2015). Business Ethics. In F. Ferrell, Business Ethics (pp. 434-443).


Samford: Cengage Learning.

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