58 Conclusion

This chapter explains the role of boards of directors in the corporate governance of organizations such as large, publicly traded corporations. Wise boards work to manage the agency problem that creates a conflict of interest between top managers such as CEO and other groups with a stake in the firm. When boards fail to do their duties, numerous scandals may ensue. Corporate scandals became so widespread that new legislation such as the Sarbanes-Oxley Act of 2002 and C-SOX have been developed with the hope of impeding future actions by executives associated with unethical or illegal behavior. Finally, firms should be aware of generational influences as well as other biases that may lead to poor decisions.

 

Exercises

  1. Divide your class into four or eight groups, depending on the size of the class. Each group should select a different industry. Find positive and negative examples of corporate social performance based on the dimensions used by KLD.
  2. This chapter discussed Oliberté shoes. What other opportunities exist to create new organizations that serve both social and financial goals?

 

Attributions

Figure 10.1:
William Shakespeare Statue, Central Park, NYC by Ahodges7 (http://commons.wikimedia.org/wiki/File:William_Shakespeare_Statue,_Central_Park,_NYC.JPG) is in the Public Domain

Figure 10.2:
Paul Cézanne 222 by The Yorck Project (http://commons.wikimedia.org/wiki/File:Paul_C%C3%A9zanne_222.jpg) is in the Public Domain

Figure 10.3:
Hopital Shriners pour enfants – Canada de Montreal – Site Glen 01 by Jeangagnon (http://commons.wikimedia.org/wiki/File:Hopital_Shriners_pour_enfants_-_Canada_de_Montreal_-_Site_Glen_01.JPG) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/3.0/deed.en) (first); CreativeTools.se – PackshotCreator – Ben&Jerry’s Cookie Dough by Creative Tools (http://www.flickr.com/photos/creative_tools/4295718895/) used under CC-BY license (https://creativecommons.org/licenses/by/2.0/) (second); Canada Post RHD by Radagast (http://commons.wikimedia.org/wiki/File:Canada_post_RHD.jpg) is in the Public Domain (third); Nuvola Chadian flag by Antigoni (http://commons.wikimedia.org/wiki/File:Nuvola_Chadian_flag.svg) is in the Public Domain (fourth); Facebook Headquarters Menlo Park detail by Soerfm (http://commons.wikimedia.org/wiki/File:Facebook_Headquarters_Menlo_Park_detail.jpg) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/3.0/deed.en) (fifth)

Figure 10.4:
Pirate 02 by Raphodon (http://commons.wikimedia.org/wiki/File:Pirate_02.JPG) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/3.0/deed.en) (first); Pirate-ship by mystica (http://commons.wikimedia.org/wiki/File:Pirate-ship.svg) is in the Public Domain (second); Chess piece – White knight by MichaelMaggs (http://commons.wikimedia.org/wiki/File:Chess_piece_-_White_knight.JPG) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/2.5/deed.en) (third);  US Navy 030717-N-9693M-002 A U.S. Army Golden Knight parachute team member turns his parachute in preparation for landing at the U.S. Air and Trade Show by Photographer’s Mate 2nd Class Damon J. Moritz (http://commons.wikimedia.org/wiki/File:US_Navy_030717-N-9693M-002_A_U.S._Army_Golden_Knight_parachute_team_member_turns_his_parachute_in_preparation_for_landing_at_the_U.S._Air_and_Trade_Show.jpg) is in the Public Domain (fourth); Skull and crossbones by Unknown (http://commons.wikimedia.org/wiki/File:Skull_and_crossbones.svg) is in the Public Domain (fifth); Human-emblem-mail-green-128 by Hucz (http://commons.wikimedia.org/wiki/File:Human-emblem-mail-green-128.png) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/2.5/deed.en) (sixth)

Figure 10.5:
New York Police Officer by See-ming Lee (http://commons.wikimedia.org/wiki/File:New_York_Police_Officer.jpg) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/2.0/deed.en) (first); Duckie Monster by Unknown (https://www.flickr.com/photos/duckiemonster/2219220078/) used under CC-BY license (https://creativecommons.org/licenses/by/2.0/) (second); 20111013-OC-UNK-0003 – Flickr – USDAgov by U.S. Department of Agriculture (http://commons.wikimedia.org/wiki/File:20111013-OC-UNK-0003_-_Flickr_-_USDAgov.jpg) used under CC-BY license (http://creativecommons.org/licenses/by/2.0/deed.en) (third); 3D Judges Gavel by Chris Potter (https://www.flickr.com/photos/86530412@N02/8213432552/) used under CC-BY license (https://creativecommons.org/licenses/by/2.0/) (fourth); Can-vote-stub by Roux (http://commons.wikimedia.org/wiki/File:Can-vote-stub.svg) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/3.0/deed.en) (fifth); Helping the homeless by Ed Yourdon (http://commons.wikimedia.org/wiki/File:Helping_the_homeless.jpg) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/2.0/deed.en) (sixth)

Figure 10.6:
Charles Ponzi (August 1920) by Richard Arthur Norton (http://en.wikipedia.org/wiki/File:21rampell.xlarge1.jpg) is in the Public Domain (first); Pyrite Fools Gold Macro 1 by “Jon Zander (Digon3)” (http://commons.wikimedia.org/wiki/File:Pyrite_Fools_Gold_Macro_1.JPG) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/3.0/deed.en) (second); SNC-Lavalin, Montreal 2005-09-02 by Gene.arboit (http://commons.wikimedia.org/wiki/File:SNC-Lavalin,_Montreal_2005-09-02.JPG) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/3.0/deed.en) (third); Nortel04 by Bjoertvedt (http://commons.wikimedia.org/wiki/File:Nortel04.jpg) used under CC-BY license (http://creativecommons.org/licenses/by/3.0/deed.en) (fourth); Logging (8692551051) by Coconico National Forest (http://commons.wikimedia.org/wiki/File:Logging_(8692551051).jpg) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/2.0/deed.en) (fifth); BernardMadoff by U.S. Department of Justice (http://commons.wikimedia.org/wiki/File:BernardMadoff.jpg) is in the Public Domain (sixth)

Figure 10.7:
SarbanesOxley by Adam sk (http://commons.wikimedia.org/wiki/File:SarbanesOxley.jpg) is in the Public Domain (first); CBP Officers seize $409,000 in Unreported Currency by U.S. Customs and Border Protection (https://www.flickr.com/photos/cbpphotos/11853767103/) used under CC-BY-SA license (https://creativecommons.org/licenses/by-sa/2.0/) (second); Flags-of-usa-and-canada by Makaristos (http://commons.wikimedia.org/wiki/File:Flags-of-usa-and-canada.jpg) is in the Public Domain (third); Budget Debate 2011 (5601686862) by Colorado Senate GOP (http://commons.wikimedia.org/wiki/File:Budget_Debate_2011_(5601686862).jpg) used under CC-BY license (http://creativecommons.org/licenses/by/2.0/deed.en) (fourth); Piggybanksvg by Googleaseerch (http://commons.wikimedia.org/wiki/File:Piggybanksvg.svg) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/3.0/deed.en) (fifth); E-ticker by klip game (http://commons.wikimedia.org/wiki/File:E-ticker.jpg) is in the Public Domain (sixth)

Figure 10.8:
50-60 jaar Chiro 20.09.2008 087 by Nousefreak (http://commons.wikimedia.org/wiki/File:50-60_jaar_Chiro_20.09.2008_087.jpg) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/3.0/deed.en) (first); Warning sign font awesome by Dave Gandy (http://commons.wikimedia.org/wiki/File:Warning_sign_font_awesome.svg) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/3.0/deed.en) (second); Diversity (10314223086) by Oregon Department of Transportation (http://commons.wikimedia.org/wiki/File:Diversity_(10314223086).jpg) used under CC-BY license (http://creativecommons.org/licenses/by/2.0/deed.en) (third); Firefighters continue their strike to protect their pensions at Earlham Fire Station, Norwich by Roger Blackwell (https://www.flickr.com/photos/rogerblackwell/14689219208/) used under CC-BY license (https://creativecommons.org/licenses/by/2.0/) (fourth); (Nuclear Grunge Sign – Sepia by Nicolas Raymond (http://freestock.ca/signs_symbols_g43-nuclear_grunge_sign__sepia_p1712.html) used under CC-BY license (https://creativecommons.org/licenses/by/2.0/) (fifth); pocketchange by Cheryl DeWolfe (https://www.flickr.com/photos/triviaqueen/4925033319/) used under CC-BY license (https://creativecommons.org/licenses/by/2.0/) (sixth)

Figure 10.9:
Bank of Montreal Sainte-Catherine-and-Cote-des-Neiges branch by Eastmain (http://commons.wikimedia.org/wiki/File:Bank_of_Montreal_Sainte-Catherine-and-Cote-des-Neiges_branch.jpg) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/3.0/deed.en)

Figure 10.10:
CIGARETTE by Fried Dough (https://www.flickr.com/photos/42787780@N04/6447395405/) used under CC-BY license (https://creativecommons.org/licenses/by/2.0/)

Figure 10.11:
Lange-MigrantMother02 by Dorothea Lange (http://en.wikipedia.org/wiki/File:Lange-MigrantMother02.jpg) is in the Public Domain

Figure 10.12:
First man on the moon by –Nightflier (http://commons.wikimedia.org/wiki/File:First_man_on_the_moon.jpg) is in the Public Domain (first); Baby on Back by Elnaz6 (http://commons.wikimedia.org/wiki/File:Baby_on_Back.jpg) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/3.0/deed.en) (second); Guitar player by Nat Ch Villa (http://commons.wikimedia.org/wiki/File:Guitar_player.jpg) used under CC-BY license (http://creativecommons.org/licenses/by/2.0/deed.en) (third); Przykład selfie by Krazyjordan7 (http://commons.wikimedia.org/wiki/File:Przyk%C5%82ad_selfie.png) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/3.0/deed.en) (fourth)

Figure 10.14:
Cerebral lobes by Unknown (http://commons.wikimedia.org/wiki/File:Cerebral_lobes.png) used under CC-BY-SA license (http://creativecommons.org/licenses/by-sa/3.0/deed.en)

Figure 10.15:
Wcfields36682u cropped by Gabriel VanHelsing (http://wikimediafoundation.org/wiki/File:Wcfields36682u_cropped.jpg) is in the Public Domain

License

Icon for the Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License

Mastering Strategic Management- 1st Canadian Edition Copyright © 2014 by Janice Edwards is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License, except where otherwise noted.

Share This Book