Even when the Board learned about the loans to Ebbers, because the loans needed to be disclosed in the company’s third quarter 10-Q report, the Board ratified and approved the compensation committee‘s actions. WorldCom received neither collateral from Ebbers nor did the compensation committee oversee Ebbers use of these funds. All of which were wrong and again, a strong pointer to how weak the Board was and it created room for a lot of accounting malpractices. A strong Board that included directors who were more focused on the shareholders would have avoided the multimillion dollars in loans that further deteriorated WorldCom’s financial situation. From the case, the conspiracy began in 2000, shortly after Ebbers' bank started calling in his
Some people may question how this scheme was able to go on for so long with nobody catching on. Ponzi schemes are very elaborate schemes. According to Business Insider, “Ponzi schemes are run by a central operator, who uses the money from new, incoming investors to pay off the promised returns to older ones. This makes the operation seem profitable and legitimate, even though no actual profit is being made. Meanwhile, the person behind the scheme pockets the extra money or uses it
Republican policies blamed Europes economic problems and not the USA for the Depression because Europe would not import any of their goods, since they could not afford to. Also, they thought that they should leave business alone to bring back prosperity but that made things even worse, by leaving things alone because it was getting worse, it looked like Hoover didn’t care of what was happening and didn’t want to help. Also, Republicans thought and feared that if the government helped people, they would become less self-governing and less willing to work. The last reason on why Roosevelt won the election, was Roosevelt’s election campaign. He went on a big tour around the USA in the weeks before the election.
The airline industry in US has been challenged and many of firms were bankrupt. However, JetBlue Airways started to expand aggressively and remained profitable by insisting on its low-fare strategy. JetBlue has been published through initial public offering in April 2002, barely two years since established. The initial price range for JetBlue shares was $22 to $24, but facing sizable excess demand, the management increased the range as $25 to $26. After the whole process of IPO including SEC reviewing, road showing, book-building, pricing, tombstone advertisements, JetBlue finally launched in NASDAQ at $27/share as initial pricing, closed at $45 per share on the first day of trading.
Ethical Issues In Management All managers are role models; however, not all managers are good role models. A leadership role offers the opportunity to communicate expectations to employees, followed up with actions demonstrating those proper behaviors. Similar to parenting, the ‘do what I say, not what I do’ approach will only result in employee rebellion. Instead, the managers supporting the ‘say what you mean, mean what you say’ mantra gain both respect and loyalty. When Paul O’Neill, CEO of Alcoa refused to join a country club that discriminated in membership, he was asked to overlook his feeling and join anyway, so as ‘not to rock the boat.’ His response was, “What excuse am I going to use six or twelve months from now?
His strategy was to expend through aggressive acquisitions. In this case, we will answer some questions such as which functions of worldcom were the problem and discuss those problems, why following orders is not an excuse for breaking the law, what is Cynthia cooper doing after the fall of worldcom and what would have been another way to resolve the problem. Worldcom set world records for the largest company to ever go bankrupt, and for the largest accounting fraud. The top departments of the whole issue were the management and the accounting departments. The objective of managers is to maximize share holders values, the management department failed to fullfil investors goals .
"Lessons from Lehman Brothers: Will We Ever Learn?" Team C Management/521 June 23, 2013 Louise Stelma, Ph. D. Introduction There were many ethical factors that led to the demise of The Lehman Brothers. The Lehman Brothers were dishonest in regard to their accounting and balance sheets and there didn’t appear to be an open door policy. Also, executives were allowed to make questionable decisions for the organization and didn’t have to answer to why those particular decisions were being made.
Shareholders and managers became rich off of Welch's vision. In the Welch system, wealth was transferred from workers to shareholders. He insulated himself from the pain this caused, rationalizing that what he did was for the greater good. However, on the other hand, the company pressured cities, counties, and states to lower taxes by threatening to relocate operations, and this lowered budgets for schools. As we all know, education industry is like the lifeline and future in a country.
Goldstein’s success in his initial performance led him to take a different approach in 1996. Instead of being a passive investor and simply waiting for discounts to close naturally he decided to take a more active role and become the catalyst to close the discounts. As an active investor Goldstein’s objective was to convince enough shareholders of the fund that closing the discount was in their best interests and that electing him to represent the fund was the best way to achieve this goal. Gaining enough influence over the shareholders to gain control of the strategy used was very difficult as managers of the fund would oppose most initiatives put forth by Goldstein as it was typically against their interests. However, if everything came together appropriately, Goldstein could forcibly close the discount and earn an exceptional return when he has free reign over the fund’s strategy.
Widespread advertising is bad for society Do you really want to buy things you don’t need and then regret it? The levels of advertising are just too much these days. People cannot walk down the street, ride on a bus, watch television or read an email without seeing advertisements. People shouldn't have to have their lives attacked by a huge quantity of information they might not want. Advertising has grown to be an industry worth many billions of dollars across the world.