1999 Business Ethics Fortnight

December 1999
 

Dear Friends,

Once again, I am happy to send you a copy of the annual report of the Center for Ethics and Business at Loyola Marymount University. Our 1999 program saw considerable growth over 1998, we achieved a major goal of attracting teams from other parts of the country, and this produced substantial improvement in the quality of the presentations in our student team competition.

In the spirit of assisting anyone interested in putting on an event like this, this report will continue to describe our attempts to improve it and to detail our discoveries about what works and what doesn’t work in a program of this sort.

Sincerely,

Thomas I. White, Ph.D.
Hilton Professor of Business Ethics
Director, Center for Ethics and Business
 
 



I. 1999 Business Ethics Fortnight




We began planning for the 1999 Business Ethics Fortnight with the same basic format we’ve used since 1996.
 

Responding to suggestions following the 1998 contest, however, we also instituted four major changes aimed at making the competition more attractive to teams from off campus.
 
  I am happy to report that 1999 was our best year yet. The number of teams from Loyola Marymount increased dramatically over 1998. We were able to attract teams from a variety of schools around the country. And the quality of the presentations again improved.
 
 


The Competition/The Winners






Approximately 100 LMU students comprising 20 teams participated in the preliminary round of the presentation competition. Five LMU teams advanced to the intercollegiate round where they were joined by teams from Loyola University of Chicago, Manhattan College, the United States Naval Academy, the University of Texas at Austin and Valparaiso University. (See the end of this report for a complete list of team members and topics, as well as summaries of the winning presentations.) The competition was very keen, with less than a point separating the top teams. Loyola University of Chicago placed first, receiving both the $1,000 Emmons Prize (for the overall winner) and the $500 Maxwell Prize (for the top non-LMU team). We had originally planned to award a second and third place, with prizes of $600 and $400 respectively. However, the scores of the next three teams were identical, so we declared three runners-up who shared $1,000: the University of Texas at Austin, Valparaiso University, and one of the LMU teams. The 5K biathlon, with its $500 Cordova Prize, was won by Valparaiso. There was a tie for the 10K biathlon, and its $500 Cordova Prize, between the team from the Naval Academy and one of the LMU teams.
 
 

All of the teams excelled in a variety of ways, and the judges were extremely impressed with everyone. However, the team from Valparaiso merits special mention because of some unusual circumstances they faced. The Valparaiso team was assigned to present Saturday afternoon. However, they were competing in the 5K division of the biathlon, which meant that they had to race that morning. Unfortunately, Shannon Bachman of the Valparaiso team was hurt during the run and had to be taken to a hospital to determine the extent of her injury. After receiving treatment (and a pair of crutches), she returned to her hotel to change, and then headed back to LMU for her team’s presentation. To present well enough to be one of the runners-up and to win the biathlon is difficult enough in the best of circumstances, but to do so under these conditions is very impressive indeed. Even though Shannon and her teammates were the youngest group in the competition, made up only of freshmen and sophomores, they handled this situation with a level of poise and maturity that eludes many people twice their age, and for that they deserve our admiration as well as congratulations.
 
 

*
 
 

Commentary on the Event






Attracting Participants
 
 

One of the most difficult aspects of holding a competition of this sort is to get enough students interested to make the contest competitive. In the first three years of the program, we tried three different patterns for attracting students. In essence, we experimented with changing our sense of the students whom we were trying to serve by the contest. The 1996 competition required participation by students in a variety of LMU core courses and allowed participation by any other interested LMU students. The 1997 competition required participation by students in one LMU core course and allowed participation by any other interested LMU students. The 1998 contest encouraged students in selected LMU electives to participate and allowed participation by any other interested students (from LMU or elsewhere).
 
 

After evaluating the results of these three approaches, we decided that, for 1999, we would use a variation of the pattern from the program’s second year. Feedback from LMU students suggested that the amount of work involved in preparing a competitive presentation was such that most students felt that unless they were doing the work for a course in which they were enrolled, involvement in the contest took away too much time from other courses. In other words, if they could get course credit, they were happy to do it. In order to guarantee an adequate field for the preliminary round in 1999, then, we required participation in selected sections of a core course required of all business majors. Happily, the strategy worked. Through careful scheduling of the day and time of certain sections of "Business as an Institution in Society," we saw a substantial increase of LMU students over 1998, with approximately 20 teams in the preliminary round.
 
 

The 1999 competition also saw us achieve a major goal of making the competition intercollegiate. This was one of our original goals, but when we began the event in 1996, we decided that we would keep the competition as a campus event for a few years as we worked out the kinks. In anticipation of the day when we would want to invite outside teams, we did do national mailings of reports and announcements about the 1996 and 1997 events. In 1998, we decided to see if we could attract students from colleges and universities in the Los Angeles area, and a small number of students from UCLA and Cal State/Long Beach teamed up with some LMU students. Given the success of this initial foray, we decided to make a major push on this front for 1999. We began looking for interested teams in the fall of 1998 through a combination of announcements on our website and mailings to deans of business schools, members of the Society for Business Ethics, and area faculty who were teaching business ethics courses. As a way of dealing with the fact that many teams simply couldn’t afford to travel to Los Angeles, we also offered the option of participating via a videotaped presentation or by videoconferencing. While we did get some response from our initial mailings, it was much less than we’d hoped. So we decided to narrow our focus and approach schools with a history of sending students to such competitions—specifically, teams competing in the "Ethics Bowl," a contest which has been put on for the last few years by the Association for Practical and Professional Ethics. So I went to the APPE meeting in Washington at the end of February, and personally approached students and coaches from a variety of teams. As mentioned earlier, we were able to interest five schools: Loyola University of Chicago, Manhattan College, the United States Naval Academy, the University of Texas at Austin and Valparaiso University. However, there was still one final hurdle to overcome. Some of these teams had difficulty finding the necessary funds to travel to Los Angeles, but fortunately we were able to come up with a patchwork solution. A long-standing friend and supporter of the Center provided us with a small fund that we could use to defray some travel costs; we received help with airfares from Southwest Airlines; and we were offered excellent rates by Los Angeles Rent-a-Car and the Wyndham Garden Hotel in Culver City.
 
 

The matter of the financial barriers to teams traveling to Los Angeles brings up an important issue that we are currently grappling with. Even though we were able to assist some of the teams financially, it was only for a relatively small percentage of the cost of travel. Fortunately, despite the fact that this was a last minute matter, the schools that sent teams had enough resources that they were ultimately able to find the money to cover most of the costs. However, this would not be true of many schools. The first 13 years of my teaching career were spent at a college that was ultimately forced to close because of financial problems. As a result, I am painfully aware that there are some schools that—no matter how much advance planning they did—simply would not be able to afford sending a team to Los Angeles. These schools are always hard-pressed financially which means that they are prevented from offering their students opportunities that regularly go to students from better-endowed schools. Moreover, a disproportionate number of these schools have student bodies that are wholly or primarily African American, Native American, female, and the like, that is, groups that traditionally have had a more difficult time entering business. Therefore, we have set as a major goal for the 2000 competition finding a corporate partner who will be willing to cover all travel costs for five teams from such schools.
 
 
 
 

Judging/Scoring
 
 

One of the perennial issues that we face in this contest is how to keep the judging fair and consistent. We use about 50 different judges, and, because their schedules are so busy, most judges evaluate only one or two presentations. The challenge is obvious.
 
 

We’ve approached this matter from a variety of angles. Based on suggestions from the judges, we’ve regularly tried to make the evaluation form that they use clearer and more precise. We try to pair new judges with veterans. As a way of muting the effect of a judge who’s either too critical or too generous, we try to have four judges at each session. And, if it comes to it, if the scoring of one judge is significantly different from his or her colleagues, we reserve the right to take that into account in determining the team’s score.
 
 

While we were largely satisfied with the judges’ performance in the 1999 competition, we did observe some significant differences among some judges in how they thought the teams should deal with the financial dimensions of their cases. Some judges were very demanding, looking for evidence that the team had done meticulous, real-life research on all the relevant financial details relating to the solution they were proposing. Other judges took a very different tack. They thought that as long as the teams showed that they understood the general financial concepts that were involved, the specific numbers the teams worked with could even be fictional. We are currently addressing this issue by working with the judges to determine a reasonable and specific set of financial criteria.
 
 

On a related topic, the fact that the overall scores of the top four teams were so close—with only a fraction of a point separating them—makes it clear that we need to revise the form the judges use to make it even more discriminating. We are currently considering a variety of options, ranging from using a different numerical scale for existing categories to adding new categories.
 
 

Of course, the new financial criteria and the revised judging form will be made available to all competitors well in advance of the competition.
 
 
 
 

Ethical Analyses
 
 

The students’ analyses of the ethical dimensions of the problems they studied showed significant improvement over 1998. We attribute this to a combination of factors. The outside teams, all of whom had participated in the Ethics Bowl, brought an impressive level of sophistication to the competition. We also notified teams in advance that we would "weight" the scores for the ethical analysis so that they constituted one-third of a team’s final score. And we developed better written guidelines. Trying to help students with the challenge of discussing ethics in a simple and practical way yet still remaining within a basic, philosophical framework, we suggested that teams address at least the following four questions.
 
 

    1. Does the problem/solution harm anyone?
    2. Who is benefited?
    3. Does the good outweigh the harm? And, in thinking about the good and harm, are you taking into account that some goods are qualitatively better than others and that some harms are qualitatively worse than others?
    4. Completely apart form the tangible impact of the problem/solution on those affected, is everyone involved being treated appropriately? That is, are there specific "rights" or "duties" that are a part of this case that must be respected? Is there a conflict of rights, duties or obligations? How should the conflict be handled?
Our thinking was that by answering these four questions, teams would be covering the basic issues involved in teleological and deontological approaches to ethics: a) the tangible good and/or harm experienced by those affected (humans and, if appropriate, nonhumans) and b) the "rights" or fundamental moral principles involved in the actions themselves.
 
 

Despite the improvement, we hope to see continued progress on this front. It was still too frequently the case that the financial and legal analyses of a team’s presentation were far more sophisticated than their ethical analysis. But, conversely, the ethical analyses were sometimes more technical than is desirable. It’s true that this is primarily a business ethics competition, and that the ethical dimensions of the case should take center stage. However, one of the competition’s major goals is to help students learn how to argue for an ethical course of action in a way that men and women in business find engaging and convincing. Thus, one of the major challenges that each team faces is to explain issues in a way that will lead average executives, lacking a specialist’s background, to readily see both the ethical issues and, in particular, their financial implications.
 
 
 
 

Tools for Improving Quality: Videotaping/Website
 
 

There was a marked improvement in the presentations of LMU students between our second (1997) and third (1998) competitions, improvements that we attributed largely to the fact that we began videotaping presentations in 1997. We taped the presentations in the final round, put the tapes on reserve in the library, and strongly encouraged students to study as many as they could. Because of our success in 1998 and our hope for further improvement, we used the same strategy for 1999. Once again, it seemed to have the desired effect, as the LMU presentations improved again. The tapes were also helpful in letting teams from other schools know what the competition entailed.
 
 

As we continue developing the competition as an intercollegiate event compressed into a small amount of time, however, the logistics associated with doing high quality taping become increasingly complex. We are thus rethinking whether we want to continue this. We currently have a good set of tapes of excellent presentations, so we probably won’t tape the 2000 competition. We’ll then assess that decision in light of the teams’ performances.
 
 

As another way of trying to improve the quality of the presentations, we began using the Center’s website as a place to post any material that we thought could help teams put together stronger presentations. We uploaded: general information on the competition, reports on the 1996-1998 contests, a list of possible topics, a detailed description of what was expected in a presentation, the form that the judges would use, and extensive material on philosophical ethics. (For more information about the website, see below.)
 
 
 
 

Increased role of students
 
 

The original impulse behind this competition was the desire to design a program in which students, not "ethics experts," would occupy center stage and in which students would be active participants, not passive observers. In light of this fact, we are planning in the 2000 competition to ask students to take on yet another task—evaluating other teams’ presentations. While we have not yet worked out the details, teams will be required to observe at least one (but possibly more than one) presentation, and to quickly prepare a written evaluation that summarizes its main points and identifies both its strengths and weaknesses. The assessment will itself be evaluated, and the team preparing it will receive a score for how well they did. These evaluations will not go into the presenting team’s score, but the team which is the subject of the evaluation will receive a copy as feedback. Our goal is to set students a task that they cannot prepare for in advance, to expose them to a variety of topics and presentations throughout the competition, and, in particular, to help them recognize that in performance evaluations, identifying strengths is just as important as pointing out flaws.
 
 




II. WWW.ETHICSANDBUSINESS.ORG






From 1996 to 1998, the Center’s exclusive focus was the Business Ethics Fortnight program. As the competition began to take shape, however, we began looking for ways that we could be an educational resource for a wider range of people. In 1997, we had posted a very basic website, but as the power and popularity of websites grew, we saw that the internet offered us the opportunity we were looking for. A website can easily contain a large number of tools and materials that can help stimulate a websurfer’s thinking about ethics. So at the end of 1998 we launched a completely redesigned website, trying to make it helpful to a variety of audiences. We continued to use the site as the primary place to post information about the spring Business Ethics Fortnight competitions and the LMU Run for the Bay. But we also tried to give readers material that they would find engaging and useful.
 
 
 
 

"Ethics Toolbox"/Links
 
 

We began by creating a section called the "Ethics Toolbox," where people can find a number of intellectual tools: a) a questionnaire that helps them learn how they currently approach ethical issues, b) a practical strategy for approaching ethical dilemmas, c) a brief defense of the moral life, and d) a description of some corporate ethics programs. From the first three of these "tools," readers can also find more extensive information: a description of these two ethical styles, discussion about whether these styles are related to gender, an overview of a philosophical approach to ethics, and a detailed discussion of Socrates’ and Plato’s defense of a life of moral virtue. The variety of material and the difference in its depth resulted from our belief that while some readers would prefer something short, others would want something more detailed. We wanted to make sure that the reader with a casual interest could get something at that level and not feel overwhelmed, but that readers with a bigger appetite could be satisfied as well. The "Ethics Toolbox" is by far the largest part of our site.
 
 

Visitors to the website can also find an extensive list of links to other sites concerned with ethics.
 
 

Cases/Discussion
 
 

We also wanted the site to have some interactive material, so we included a section that contains short descriptions of some contemporary ethical issues in business. We began with the Long Term Capital bailout and the more prosaic issue of taking credit for someone else’s idea. When the opening of a Hooters restaurant stirred considerable local controversy, we posted that as a case. And, even though it was more of a sports issue than a business issue, we asked for reaction to the charge that the goalie of the world champion American women’s soccer team had in fact "cheated." On some of these cases, we ask specific questions; on others, we simply solicit reactions. We also have a general bulletin board, where anyone is welcome to post comments on any issue of interest to them.
 
 

Visitors can sort through the results of how readers vote on these cases by sex or age, and at least on one issue, we’ve seen a small, but interesting, difference in how men and women have responded. The case is as follows: "You make a suggestion at a meeting. You’re ignored. Ten minutes later, someone else says the same thing—without giving you credit. Is this stealing?" Readers are asked whether they’ve ever experienced this in the workplace, how they would rate the action ("nothing wrong," "somewhat wrong," or "very seriously wrong"), and whether they consider it "stealing."
 
 

Throughout the first 300 responses, a pattern has emerged in how men and women respond to this scenario. Although there is no significant difference in the percentage of men and women who have experienced this in the workplace (76% of the men and 81% of the women say they have) or who think it counts as "stealing" (76% of the men and 77% of the women label it as such), there is a difference in how seriously wrong the sexes see this matter. More women think it’s more seriously wrong than the men do: 58% of the women versus 51% of the men say "very seriously wrong" (while 40% of the men versus 32% of the women say it’s only "somewhat wrong," and 10% of the women versus 9% of the men say "nothing wrong.") It’s not a huge difference, but the 58% versus 51% and the 40% versus 32% differences seem noteworthy when all of the other figures are about the same.
 
 

Visitors can also post comments on any of our cases or on any topic they choose on the site’s discussion board. Or, they may write directly to the Center via an e-mail link.
 
 

Business Ethics Fortnight/LMU’s Location/Website Contest
 
 

As mentioned above, the site is the main location for information about our annual competition: the intercollegiate student team presentation and "L.A.’s Weirdest Biathlon" (the combined academic/athletic contest). We include reports on earlier competitions, detailed guidelines, a copy of the form that judges use to evaluate presentations, a list of possible topics, and any other information that we think might be helpful. The page describing the biathlon even includes a link to training programs on the Runner’s World website for anyone new to running. We have a separate, but linked website for the LMU Run for the Bay (www.runforthebay.org), where readers can find race information, a course map, and the best times from past races. In the hope of providing some extra incentive to students from other parts of the country who might be interested in putting together a team, we also use the website to shamelessly promote the university’s proximity to the beach. LMU is only one mile from the ocean, and April in Los Angeles is decidedly warmer than April in Boston or Chicago, for example. We thus offer links to some of the webcams at area beaches and even to a surf report.
 
 

We are also using the website to promote a new addition to the program. In order to make it easier for more students from a distance to be involved in Business Ethics Fortnight, and as a way to challenge students to learn how to work effectively with new technologies, the 2000 Business Ethics Fortnight will include a business ethics website design competition. Because we believe that websites will continue to evolve as tools that individuals in business use for the sake of communication and persuasion, we are inviting students from across the country to design a website that addresses an ethical issue in e-commerce. We’ll choose a case that all teams will work on; we’ll post the details of the case; teams will submit their websites to us; we’ll upload them all at the same time; and then they’ll be judged. Competitors face a daunting challenge. How do you design a site that educates a viewer about the ethical, financial and legal dimensions of the problem and persuades them that you’ve come up with a reasonable solution that passes muster on all three counts? How do you design a site that is at the same time "user-friendly," comprehensive and effective? We believe that this is a good educational exercise in itself. But since our goal is for the websites to be judged by men and women from business who have a fair amount of online sophistication, we’re hoping that this will be another way that we can develop connections between business and the academy.
 
 
 
 

Two Surprises
 
 

We’ve been pleased with the reaction to the website and with the number of visitors it attracts. There is also regular use of the discussion board. And we’ve had a number of requests from individuals in human resource departments for permission to use our ethical style questionnaire in ethics training sessions. However, three developments have surprised us. First, we have attracted more international visitors than we’d initially expected—especially more students. We now regularly respond to inquiries on a variety of topics from students working on projects in business ethics from one side of the planet (Great Britain) to the other (New Zealand). Second, we have been able to assist a wider constituency than would have been the case if we had no website. During the first few months of the site, I received requests for assistance from programs designed to bring individuals from other countries to the United States in order to learn how business and government handle ethical issues. In each case, we were contacted after a web search on business ethics turned up our site, and after the program officer was impressed enough with it to think that we might be a useful resource. As a result, we have had the opportunity to discuss a variety of issues connected with implementing ethics programs with individuals from such countries as Estonia, Jordan, Namibia, Vietnam and Paraguay—opportunities that we never imagined would present themselves.
 
 
 
 

The Third Surprise: Our Slogan/Going Retail
 
 

While the two matters just described surprised us, they were still within the scope of what might be reasonable to expect from a business ethics website. However, one matter took us far beyond what we’d ever expected.
 
 

I have detailed in an earlier report that during the third year of the program, we began using a slogan designed to catch students’ attention. We said that the competition was, "More fun than decent people think should be legal." The first time we used this slogan on a banner, the banner was stolen after one day. The second banner lasted five days before it too disappeared. This convinced us that we had an attractive slogan, so we began the process of copywriting it, and we started looking for ways to use it effectively. The first thing we did was to produce bumper stickers with the slogan on them and to give them away. (We hoped that this would at least reduce the likelihood of losing another banner.) We offer the bumper stickers at campus events, throughout the competition, at the LMU Run for the Bay and through our website.
 
 

However, it was our offer on the website that has produced our greatest surprise. Over the last year, we have received nearly 5,000 requests for bumper stickers from different parts of the world, and this led us to wonder whether we could find a way to use the slogan to raise funds for teams in the competition who needed help with travel expenses. As a result, we have just opened a "store" on the Center’s website that offers both T-shirts and coffee mugs that carry the slogan. I will report in the future whether this venture proves successful. However, it is fair to say that the last thing we ever imagined being involved in is retail sales.
 
 


III. The future






The development of Business Ethics Fortnight through its first four years, our foray into the internet, and some major events at LMU have taken us to a point where we need to do give serious thought to our future.
 
 

Accordingly, the Center has recently established an Advisory Board. The membership of this group is wide-ranging, with some individuals coming from business and others from different corners of LMU. Our hope is that such a richness of perspectives will be an invaluable resource as we chart our course for the future. My next report, then, will have much more to say about how we see our role in the next millennium.
 
 



 
 




1999 BUSINESS ETHICS FORTNIGHT

INTERCOLLEGIATE STUDENT TEAM PRESENTATION COMPETITION

PARTICIPANTS






First place/Presentation Competition (Emmons Prize)

Mawell Prize (Best non-LMU presentation)
 
 

English-Only Language Policies: Civil Rights and Liberties in the Workplace
 
 

Joseph Kirkland, Marty Julia Lentz, Charles Tate; Chris Field, advisor; Loyola University Chicago
 
 

Business Identity of Team
 
 

Golden Mean Consulting, a quality-oriented consulting firm with a commitment to providing legally, ethically, and financially superior solutions to meet our client’s needs and exceed their expectations.
 
 

Business Identity of Judges
 
 

A committee comprised of senior executives from Watlow Electric Manufacturing Company (St. Louis, Missouri), whose Illinois-based subsidiary Watlow Batavia, Inc., is facing a lawsuit filed by the U.S. Equal Employment Opportunity Commission as a result of the company’s "English-only" policy.
 
 

Executive Summary
 
 

In August of 1997, Watlow Batavia, Inc., an Illinois-based subsidiary of your St. Louis-based manufacturing company, Watlow Electric Manufacturing Co., adopted a brief policy with, as senior management would soon discover, potentially disastrous results. This policy, a so-called "English-only" policy, mandates that "no worker can speak a language other than English for whatever reason during business hours while on business premises." Four employees were terminated and three employees were disciplined for violating the policy by conversing in Spanish with co-workers. The employees terminated in relation to the "English-only" policy were workers on a twelve-person assembly line. As a result of these firings, the U.S. Equal Employment Opportunity Commission has filed a lawsuit against Watlow Batavia on the grounds that the "English-only" policy violates the civil rights of employees because it bars them from speaking Spanish at any time during working hours.
 
 

Though "English-only" rules may be adopted for reasons that are legally and ethically questionable, it is easy to conceive of a business environment wherein such policies would be appropriate. Companies may adopt "English-only" rules for apparently legitimate reasons such as to promote efficiency, productivity, safety, or employee morale. As David Griesing reports in the Chicago Tribune, "There are workplaces where an English-only rule may make sense. In operating rooms, where teamwork is vital with lives on the line. In nuclear reactors, where misunderstanding could cause meltdowns. In airport control towers." In short, English-only policies are defensible by appeal to a legitimate business necessity. As we will argue, however, Watlow fails to provide a legitimate business necessity.
 
 

Insofar as Watlow’s current "English-only" policy is legally questionable, ethically suspect and fiscally irresponsible, we urge your company to (1) negotiate a fair, out-of-court settlement with the EEOC and (2) adopt a legal, ethical, and financially-sound alternative to Watlow’s current "English-only" language policy. Our hope is that Watlow will be able to minimize the possibility of future legal action and the exorbitant costs, financial and otherwise, which result from litigation. Ms. Lentz will speak to the legality of Watlow’s current policy, defining the admittedly ambiguous case law in this area and any relevant legal precedents surrounding English-only rules. Given this legal foundation, Mr. Tate will elaborate on the ethical nature of English-only rules, demonstrating both the extent to which our proposed alternative is ethically superior to Watlow’s current English-only rule and the relevance of such ethical reasoning to the art of business. Mr. Kirkland will summarize our policy proposal with a special emphasis on the financial benefits of our proposed solution. It is our hope that Watlow Batavia can become a stronger, more competitive company as a result of this challenge.
 
 
 
 
 
 

Runner up/Presentation Competition

Winner, 5k Biathlon (Cordova Prize)
 
 

Considering Johnson & Johnson’s Operations in China
 
 

Shannon Bachman, Joel Boehm, Benett Bootz, Robert Evans, Jonathan Huffman; Sandra Visser, advisor; Valparaiso University
 
 
 
 
 
 

Business Identity of Team
 
 

Representatives of the Executive Committee of Johnson & Johnson
 
 

Business Identity of Judges
 
 

Johnson & Johnson shareholders
 
 

Executive Summary
 
 

Currently, Johnson & Johnson manufactures in and sells products to China. Due to the recent debate over the United States’ position with China, we at Johnson & Johnson have re-evaluated our position with respect to operations in China. Since there are no clear legal guidelines governing our actions, our evaluation focused mainly on moral and financial considerations. Having found that the Chinese Government engages in activity we find unacceptable, and given that our operations in China and our sales to China result in taxes paid to this Government, we were forced to decide whether we can in fact justify our current status with China.
 
 

Certainly there is no clear answer to this dilemma. Whether we cut off, maintain, or increase operations in China, there will be negative consequences. The taxes paid to the Chinese Government will certainly help support this institution. Yet withdrawal will hurt our Chinese employees, particularly if other companies recognize our actions as correct, and follow suit. The effects of Johnson & Johnson’s decision are certainly not limited to those mentioned above as well.
 
 

The situation is also dynamic. Any decision made will need to be re-examined as circumstances change. However, Johnson & Johnson cannot sit idly by, adopting a "wait and see" attitude. We must examine closely the data available, and weigh this information against our consciences, as well as the company Credo -- our guiding inspiration since General Robert Wood Johnson introduced it over 50 years ago.
 
 

Having weighed the multiple aspects of this dilemma, we will recommend to you, our shareholders, that Johnson & Johnson both remove manufacturing operations and discontinue sales in China.
 
 
 
 
 
 

Runner up/ Presentation Competition
 
 

Global Profts, Global Headaches
 
 

Jessica Chou, Elizabeth Edrington, Helen Wei; Bill Shaw, advisor; University of Texas at Austin
 
 
 
 

Business Identity of Team
 
 

K-PAN Business Practice Improvement Committee
 
 

Business Identity of Judges
 
 

K-PAN Board of Directors
 
 

Case: Global Profits, Global Headaches
 
 

K-PAN is a Ft. Worth maker and marketer of textiles. It’s a publicly traded firm whose name, for over 50 years, was synonymous with men’s and women’s work clothes. The 80’s and 90’s brought great changes to the textile industry. Among other things, labor costs were on a steep incline. In K-PAN’s North Carolina and Texas plants, costs were squeezing profits to the point that K-PAN’s board decided to follow its competitors overseas. Over a three year period, K-PAN phased-out its domestic operations with a generous re-training, re-settlement program for former employees in need of help, built a $28 million state-of-the-art plant in Nicaragua ($20.5 million in bonds placed by Dillion), and purchased its remaining needs through local agents in Pakistan and Indonesia.
 
 

The worldwide popularity of one of K-PAN’s articles, "Hangin," put a welcomed spike in its earnings, but also focused public attention on problems that its board was determined to resolve.
 
 

The adverse publicity that first stunned Nike and Kathy Lee, began to haunt K-PAN with a vengeance. Ft. Worth residents, supported by a vocal group of former K-PAN employees and the Amalgamated Textile Workers Union, assailed the firm via informational picketing and through the media. K-PAN’s "model" plant in Nicaragua exhibited a number of shortcomings (long hours, low pay, environmental, health, and safety problems). The negative publicity generated by its Central American operations paled in comparison to the outcry that stemmed from its link with "sweatshops." Its purchases through local agents in Pakistan and Indonesia [allegedly] contributed to the perpetuation of atrocious working conditions in those countries.
 
 

K-PAN’s insistence that it owned and operated no facilities in those countries couldn’t begin to ward-off attacks on its corporate policy. "K-PAN ETHICS," the central focus of its code had been untouched since it was carefully crafted by K-PAN’s founder, Mr. W, as he was widely known. K-PAN ETHICS spoke of a "living wage," "shareholder satisfaction," "community responsibility," and "customer confidence," but those components of the code were met satisfactorily (or, at least, they were un-protested) since their post-war inception.
 
 

"If we forego profits to raise working conditions in the Third World," remarked one board member, "we’re just going to have to reduce our purchases, and that’s going to cost jobs. Who’ll be better off? And our customers won’t be happy with the higher prices either. They could switch to Levis or Wranglers."
 
 

"Why not take those costs out of profits?" asked Professor Dickinson, boyhood pal of the founder and the most recently elected board member. "My God," groaned the chief financial officer. The representative of Dillion rolled her eyes and remarked, "The bondholders are going to love us. "Someone caught the Chairman’s attention and asked, "Can we take a break now?"
 
 

The Chairman was about to grant the request, when Elizabeth Edrington, daughter of the founder, interrupted. "I’d like for the Chairman to appoint Helen Wei, Jessica Chou and me to a committee to look into this matter further and report back at our next meeting." "So Ordered," said the Chair, "we’ll hear your report at our West Coast retreat, scheduled for the 16th April in L.A. Meeting adjourned."
 
 

Executive Summary
 
 

To: K-PAN Board of Directors
 
 

From: K-PAN Business Practice Improvement Committee
 
 

Background
 
 

K-PAN, a Fort Worth, Texas firm, produces and markets textiles while specializing in men’s and women’s work clothes. As the prices of domestic labor rose throughout the 1980s, the company decided to move production to Nicaragua and acquire supplies through merchants in Pakistan and Indonesia. Although K-PAN gained popularity and profits through its new strategy, adverse publicity arose due to its association with and exploitation of sweatshops.
 
 

Issues
 
 

At last month’s board meeting, K-PAN executives discussed the problem at length and organized a committee to examine the issues involved. The appointed committee convened and evaluated

possible solutions to the problem according to three primary issues:
 
 

· Financial performance over the short and long term
 
 

· Current lack of legal standards governing the industry

· Ethical implications of any solutions prepared
 
 

Recommendations
 
 

The goal of the committee is to bolster ethical standards while maintaining profits in order to align K-PAN’s actions with its corporate policy. After completing a thorough analysis of the

issues, the committee designed a three-part solution in order to remedy the sweatshop problem:

· Phase out of purchases in Indonesia and Pakistan

· Focus on improving working conditions and employee wages in Nicaragua

· Adopt new business partners who will help enforce our ethical standards
 
 
 
 

Runner up/Presentation Competition
 
 

Should Coca-Cola Continue to Sponsor the Olympics?
 
 

Jennifer Cabeje, Michael Kelley, Regan Ranoa, Marie Sia, Lisa Watkins; Loyola Marymount University
 
 

Business Identity of Team
 
 

Coca-Cola Marketing Ethics Committee
 
 

Business Identity of Judges
 
 

Senior Management of Coca-Cola
 
 
 
 
 

Executive Summary
 
 

Recently, the International Olympic Committee (IOC) has been accused of accepting bribes from cities bidding for the Olympic Games.
 
 

Coca-Cola spends about $350 million on their Olympic marketing campaign. Corporate sponsors expect not only to gain positive exposure of their company name, but also to increase sales of their products and to increase market share.
 
 

The United States Senate’s proposal for a change in tax-exemption legislation and the OECD’s anti-bribery treaty may hinder attempts of bribery in the United States and abroad.
 
 

Both the Olympic Games and the International Olympic Committee claim to be founded upon fundamental principles of fair play and honor. For this reason, Coca-Cola had decided to be the Olympics’ longest continuing sponsor. Yet, the IOC scandal has presented ethical dilemmas for the IOC and its corporate sponsors.
 
 

After a lengthy investigation of the situation, we recommend that the Coca-Cola Company pressure the IOC to reform. Because Coca-Cola and the IOC have had a long relationship, we feel that the IOC will seriously consider Coca-Cola’s request for a public financial statement, an independent bid committee, and accountability.
 
 
 
 
 
 
 
 

10k Biathlon (Cordova Prize), tie
 
 

The Role of Women in the Military
 
 

Dennis Doyle, Alexs Thompson, Robert Devine; Aine Donovan, advisor; United States Naval Academy
 
 

Long Term Capital Management
 
 

Britta Bucholz, Colin Casey, Joseph Harrison, Rob Taylor; Loyola Marymount University
 
 

Other Finalists:
 
 

Compliance Risk Management: James Gannon, Timothy Giroux, Elizabeth Hickey; Manhattan College, John Wilcox, advisor
 
 

Software piracy: Bill Buermann, Michelle Chapman, Trevor Foley, Sarah Reed, Vincent Kostiw; LMU
 
 

Sex and advertising: Sammy Chow, Lavinia Iskandar, Traniece Jackson, Christopher Johnson, Myetta McCoy, Magan Mitchell; LMU
 
 

Maquiladoras: Kerry Bardwil, Richard Michael, Anthony Podegracz; LMU
 
 
 
 

LMU Preliminary round competitors:
 
 

Production of collegiate apparel in sweatshops: Tamaya Petteway, Melissa Redondo, Tricia Thompson, Nina Vujanovic
 
 

Investment opportunities in brothels abroad: Lindsay Gladner, Akash Lal, Yvette Nino, Jia Lin Wang
 
 

Hawaiian Tropic and bikini contests: Lou Ceniza, Edward Figueroa, Alex Martinez, Marcel Perez III, Ou Te
 
 

Child labor and Disney: Paul Babatunde, Gabe Pagtama, Lynn Presto, Roxanne Stonerock
 
 

Ethical issues in electronic information systems: Amine Chamchoum, Dayra Dominguez, Lisa Mak, Ana Valdivia, Valisara Vongsrirungruang
 
 

Advertising and sex: Ed Chen, Nuantia Flowers, Kathy Kim, Kenichi Saito, David Theroux
 
 

Pornography and the internet: Viendif Gunawan, Victor Ibrahim, Indrawan Januardy, Brian Kleinhofer, Lyris Oliva, Jenn Woodward
 
 

Violence and films: Abby del Rosario, Franchesa Gordon, Jodi Murayama, Todd Okamoto, Nicole Zabat
 
 

Animal testing and cosmetics: Brian Davis, Carrie Estes, Alexa Fasheh, Richard Mills, Mala Trifunovic
 
 

Beer and advertising to minorities: Maureen Langham, Jessica Norlin, Analia Piccollo, Liliana Torres
 
 

Pricing of pharmaceuticals: Juan Flores, Daniel Mursalim, Eric Sutanto, Hector Torres, Robert Utomo
 
 

Biotechnology: Alexis Cole, Meghan Dunbabin, LaVonne Gonsalves, Mark San Buenaventura, Aimee Shimizu, Daphne Vadman
 
 

Three Gorges Dam: Richard Michael, Maria Moy, Jay Romias, Grace Szebelledy, Tulinh Vu
 
 

Maquiladoras: Lynn Brown, Fanny Kosasi, Omar Gonsalez, Alicia Soto, Jinie Tenges
 
 

Hooters of America, Inc.: Anabel Caraballo, Jorge Cuervo, Conrad Haro, Julian Liu, Eldo Lopez, Ricardo Ordonez
 
 
 
 

Judges:
 
 

Dolphy Abraham, LMU

Angel Barragan, Los Angeles Times

Ross Bengel, LMU

Gail Bernstein, PNC Business Credit

Blanche Bettinger, LMU

Ben Bobo, LMU

Peter Brockett, Brockett Tamny and Co.

Richard W. Burden, Burden and Associates

Janice Burrill, Wells Fargo Bank

Richard W. Capalbo, Oxford Group

Linda Carlisle, Northrop Grumman

Kevin Choroomi, Stonecraft Enterprise

Jeff Covert, Oracle Corporation

Frank Daly, Northrop Grumman

Lynn DeGroot, U. S. Trust

Leah DeLancey, Baker & Hostetler, LLP

Carville Dennehy, Northrop Grumman

Patricia Douglas, LMU

Tom Fleming, LMU

Robert Foster, UCLA

Jeff Gale, LMU

Frederica Hendricks, LMU

Les Hribar, Ukiah Software

Hal Huffer, MXPXA Planning Group

Joseph Jabbra, LMU

Mary Korey, Automobile Club of Southern California

Sherry Lawson, Coldwell Banker

Joe Lim, Imperial Bank

Dale Loepp, United Building Materials Corp.

Jerry Mann, UCLA

Thomas J. McCabe, Jr., Northrop Grumman

Mahmoud Nourayi, LMU

Tracie Ricketts, Steelcase

Peter Smith Ring, LMU

Barney Rosenberg, LRN, Inc.

Ricci V. Ruffinelli, VCS, Inc.

Tom Sabol, Englekirk and Sabol, Inc.

Kala Seal, LMU

Jim Stalker, The Maxwell Group

Annette Stoll, The Maxwell Group

Rolf Strutzenberg, Toyota

Courtney Surls, LMU

Louke van Wensveen, LMU

Steve Venghaus, Stevens Air Transport, Inc.

Thomas Edward Wall, Los Angeles County Metropolitan Transportation Authority

Ray Watts, LMU

Aimee Wheeler, Norwestern Mutual Life/Baird

James Wilson, Toyota

Millie Yamada, Northrop Grumman

Beverly Youngstrom, Northrop Grumman
 
 
 
 



 
 

LMU Run for the Bay
 
 
 
 

5K Men
 
 

1. Alan Gord, 28, 16:23

2. Martinez Hilario, 35, 16:45

3. Michael Oleata, 36, 16:48
 
 

5K Women
 
  1. Lauren Klatsky, 24, 18:55

2. Adrianne Trader, 35, 19:04

3. Kelle Taylor, 35, 20:27
 
 
 
 

10K Men
 
 

1. Dan Goldstein, 34, 33:12

2. Stefan Skasa, 28, 35:35

3. Marco Ortiz, 49, 35:40
 
 

10K Women
 
 

1. Angela Isbill, 24, 35:40

2. Lene Tapangco, 25, 38:16

3. Phyllis Pastre, 34, 42:35
 
 

Winner of race T-shirt design competition: Maureen Pacino, LMU
 
 
 
 
 
 



 
 
 
 
 
 
 
 

DONORS AND SPONSORS
 
 
 
 

Business Ethics Fortnight: Donors
 
 

Moses and Rachel Cordova

Northrop Grumman

Robert H. Kerrigan, Northwestern Mutual Life/Baird

The Robert and Christine Emmons Foundation

The Maxwell Group

Center for Asian Business

Conrad N. Hilton Foundation

Los Angeles Chapter: National Association of Purchasing Management
 
 

Business Ethics Fortnight: Sponsors
 
 

Los Angeles Rent-a-Car

Wyndham Garden Hotel, Culver City

Southwest Airlines
 
 

LMU Run for the Bay: Sponsors
 
 

Amazing Balloons by Gee

Boise Cascade Office Products

Kuli Image

Runner’s World

Ralphs

Sparkletts

Trophymasters
 
 
 
 

OTHERS WHO ASSISTED WITH THE COMPETITION OR THE RUN
 
 

Andy Barillas

Katherine Berry

Kim Francis, Heal the Bay

Mark Gold, Heal the Bay

Allen Gray

Suzanne Kite

Akash Lal

LMU Conferences and Scheduling

LMU Development Office

LMU Public Safety

Herbert Medina

Peter Mosinskis

Michael Reiner

Ken Summers

Time Management

Chad Yussman

The 40+ race volunteers