POCKETING THE GREENS CASE STUDY 1. Immediate Issue(s) or Problem(s) In Pocketing the Greens case, Cheap Pharma Inc. (CPI), a pharmaceutical company specializing in generic drugs sued Mr. De Guzman and two other members of the Board of Directors (BOD) for profiting from the transaction they made with CPI’s competitor and potential business partner named Green Med (GM). The CPI’s shareholders are demanding Mr. De Guzman as well as the two other members of BOD to render an accounting and return whatever profits they made from their transaction with GM to CPI. Is CPI in the right position to do this? What duties do directors owe the corporation which they serve? In this case, CPI and GM are competitors. Both of them are pharmaceutical companies. However, CPI is suffering from low sales due to fierce competition. On the other hand, GM is an insolvent company who is famous for its innovative use of lagundi leaves …show more content…
Thus, the BOD was forced to use the excess fund for buying the GM’s shares of stocks to cover the reconstruction of the plant. Mr. De Guzman and the two directors who processed the transactions convinced Dr. Gonzales to sell the shares to them instead. Dr. Gonzales agreed and the directors ended up buying the shares of stocks intended initially being sold to CPI. Given these pieces of information, were the directors exert enough effort to make CPI meets its obligations with GM? Were the directors in this case justified in buying the shares of Green Med? Can CPI sue GM and the directors for selling and buying the shares of stocks? Consider the possibility that CPI was not able to meet its obligations, can GM through Dr Gonzales sue CPI? The lawful and moral issues and the questions rose in this case study is what the author aims to resolve towards the end of this
Jan acknowledges his situation, “The whole idea of lawsuits is to settle, to compel the other side to settle” [1]. In fact, he uses this reasoning to his advantage by demanding a total of 320 million dollars from both companies. The case is drawn out and both businesses stubbornly refuse to take responsibility, Cheeseman arguing that, “These chemicals never reached Wells G and H - we will show that. And they never made anyone sick. We will show that, too” [1] while Fascher, representing Beatrice Foods, explaining that, “Unless you've proven that poisons reached the wells, there's no case” [1].
In 2004, John and Timothy Rigas were convicted in the New York District Court for charges that involved conspiracy, bank and security FRAUD. All of the security frauds cited against them were upheld on several counts. Michael Rigas and Michael Mulcahey were not found guilty on the charges brought upon them. For John and Timothy Rigas, the judgement passed down to them was up to 30 years in prison.
Logos Based on my understanding, Zunes does a great job stating his logos using the title and the subtitle. There are 10 things that Zunes would like to go over with readers that everyone in the world should be aware of, but often not. Therefore, a particular introductory paragraph that that arguments have may not be needed. The title and the subtitle are informative and clear.
Nowadays it seems like legal drugs are more expensive than illegal ones. This dilemma occurs because the pharmaceutical industry affects the economy significantly. Although the United States is a mixed market economy, there are instances where the economy seems like a free market economy. A free market economy allows companies to determine the prices of goods free from government intervention. The pharmaceutical industry, despite several regulations set by the food and drug administration, is a free market economy.
In the aftermath of Hurricane Katrina, there had been, and still are, many outcries of acts of injustice. Some argue that the majority of the urban black population hasve been unfairly treated. Some others hand out a harsher verdict that racial profiling and discriminations were the true motives of the mishandling the Katrina crisis situation. To make it worse, the media portrayed the victims of the disaster as perpetrators’ of imagined violence during the height of Hurricane Katrina. In any case, it is impossible to argue that the government as well as the public did treat the economically disadvantaged victims of Hurricane Katrina in a fair and timely manner.
This proves that throughout the case, Cendant Corporation wasn’t acting fully ethical nor with the desired fiduciary actions to their investors and the auditing team in this case being Ernst&Young. Aside from the trust being broken apart between both, there was never a sign of an internal control inside Cedant. Therefore, there shows that the corporate governance for Cendant Corporation didn’t have signs of existence as well. Most frauds that were occurring before the implementation of the SOX-2002, had top management such as in Cendant that didn’t have care for the ethical performances as much as in today’s corporate world with more regulations in hand by the government. At the end, Cendant had filings against them concerning their corporate governance
Why does a board of directors have a chairperson? Each of these groups is founded on the principle that each member gets a vote and power is distributed. But in order to accomplish decisions and missions, these groups succeed when they have strong leaders. Not leaders who silence the members and assume all power - rather, leaders who direct, motivate and inspire the members to work harder. To progress, a community needs clear guidance from an effective leader who can be replaced if necessary.
Wheeler v. The Pullman Iron & Steel Co. provides the particular evaluation standard. It establishes that “The majority of shares of its stock… must be permitted to control the business of the corporation in their discretion,” so long as it does not violate the law or corruptly subvert the rights of a shareholder.” Moreover, since it is “not [the courts’] function to resolve for corporations questions of policy and business management,” they must carefully pinpoint the breaking of law or corruption. For the rest of the board, gross negligence must be proven. Such a standard requires evidence of “reckless indifference to or a deliberate disregard of the whole body of stockholders or actions which are without the bounds of reason.”
Every citizen in the United States has individual rights protected by the Constitution. This protection also includes businesses that have gone through the legal process to become a legal entity ; more commonly known as becoming a corporation. Many times these individual rights, protected by the Constitution, conflict with the common good and as history shows, the courts consistently side with the common good when faced with a case that pits these two against each other. Big Pharma are corporations exercising their individual rights to market, and sell their product to consumers. In the process, the common good is suffering.
(Diageo, 2017). DIAGEO PLC’s BOARD OF DIRECTORS Roles: The role of the Chairman of the Board is to manage and provide leadership to the Board and ensures that all the Directors are properly informed and adequate information is made available to facilitate appropriate judgements. The CEO of Diageo has a duty of care for the day to day management of the company and putting into effect the resolutions and policies of the Board.
Derek Rotz MBA-502-61/03 3/2/18 In the case of Ace Fertilizer Company, Assistant Director of Manufacturing , Abby Conroy is faced with an ethical issue that was presented to her by boss George Smilee who is the Director of Manufacturing. Ace Fertilizer’s business is to produce lawn & gardening fertilizer, and the company is known for delivering the highest quality special order products. The fact that they can deliver on time with top quality is what helps to drive their business. They use a consistent mark up on special orders at an 80% mark up over the cost of the orders.
This is evident in that ADM did not comply with the framework set out for the business, therefore issues such as accountability, fairness and transparency have been misused and unethical actions were carried out .For example we see Mark Whitacre forging signatures and being able to make unauthorised payments. Therefore the primary characteristic of good corporate governance which is accountability has been violated. This action is immoral and amounts to unethical behavior. Furthermore, employees in ADM were expected to accept kickbacks via cheques.
The company pursued the wrong person after been told serval times by the defendant. The defendant was awarded 83 million dollars. PRA Group is proceeding back through the court system working on getting the ruling overturned (Margolies, 2015). This lawsuit was legal and ethical however it could be deemed as legal and unethical.
A Strategic Report provides shareholders of the company with information that will enable them to evaluate how the directors have performed their duty to promote the success of the company. A strategic report will always contain information that is material to its shareholders just like an annual report. A strategic reports main objective is to provide an understanding into the company’s business model and its main strategy and objectives. It also provides the users about the risks faced by the company and its impact in the future. The companies past performance is also analysed in the strategic report.
A system to check and balances the benefit of all the board of directors and to avoid some of top management from making decisions that only benefit themselves is created and named corporate governance. Corporate governance means the system of rules, practices and processes by which a company is directed and controlled. The set of rules provided as a guidelines for the board of directors to make sure that accountability and fairness in a company’s relationship with its stakeholders such as financiers, customers, management, employees, shareholders and also society in order to achieve company’s goals and targets in a manner that add a value to the company. All of the stakeholders play an important role in corporate governance to ensure that