Legal environment

Please see attached 2 PDFs (Chapter 1 and Chapter 2) and the attached PDF with 7 case problems and questions for answer. Use the materials from the PDF to answer the questions below.

Chapter 1

1.1 What public policies are furthered by this law? To what extent are there conflicts among the policies served, and how will they affect the way the law in this area is interpreted, applied, and changed?

1.2 What effect does this body of law or legal tool have on the competitive environment and the firm’s resources?



1.4 How can managers responsibly help shape this aspect of the legal environment?

Chapter 2

2.2 Christine Bancroft is a twenty-five-year-old blonde with a face and a figure that some of her male colleagues thought seemed better suited to the cover of the Sports Illustrated swimsuit issue than Advertising Age. After spending her first three months as an analyst at the privately held advertising boutique Scot Wayne More, sitting in her cubicle doing research on the Hispanic market, she looked forward to the day she would have a chance to wow clients with the finely honed marketing skills she had acquired while pursuing her MBA at Northwestern University.

Christine knew that Allen Scot and Bart Wayne had a reputation for entertaining clients from out of town at San Francisco’s all-male Pacific Union Club, so she was pleasantly surprised when Allen asked her to join him and Bart for lunch with Andrew Wise at the World Trade Club. Wise was an account executive from the Cincinnati headquarters of Quinn & Inder, the second-largest consumer products firm in the United States. At first, Christine thought that she’d been invited to discuss their plans to extend Quinn & Inder’s reach into the Hispanic youth market. But when she asked Bart how she might best prepare for the meeting, he smiled and said, “Just wear that little black dress you wore at the firm’s holiday party and leave the talking to Allen and me. Andrew asked for California, so we’re giving him California.”

What should Christine do? What would you do if you were head of human resources for Scot Wayne More and overheard the conversation between Bart and Christine while waiting in Allen’s office to go over an offer letter for a new hire? [Inspired in part by Joseph L. Badaracco, Jr., DEFINING MOMENTS: WHEN MANAGERS MUST CHOOSE BETWEENRIGHT AND RIGHT (1997).

2.5 Ginny Viloudaki, a recent graduate of New York University, is a first-year associate with the McBain Consulting Group. The partner in charge of a major strategy study for an important new client in the shipping business has asked her to call low-level employees in competing shipping companies to gather competitive data for use in devising a winning strategy for the client. The partner instructed her not to identify the client but to introduce herself as a consultant doing an analysis of the shipping industry.

Assume Viloudaki knows that senior managers in the competing firms would consider the data she is collecting proprietary and would not talk with her at all if they knew she worked for a direct competitor. Is it ethical for Viloudaki to question the lower-level employees without revealing that she is working for a direct competitor? What should she do if, after she tells the partner she considers it unethical to make the calls, the partner tells her that consultants do this all the time and that refusal to make the calls would be a career-limiting move?

2.7 By reading an individual’s Facebook or Twitter page, one can see his or her pictures, the people he or she is communicating with, what is written on the page, and even what the individual writes on others’ pages. Many people, however, have restricted access to their personal information by adjusting their privacy settings to better protect their privacy. The only way to see such a person’s entire page is to become his or her “friend.”

You are a manager of a consumer products company. Members of the managerial staff have an interest in discovering background information about potential employees and also have concerns about how employees are using their time while at work. You would like to find out more about your employees, so you, as a manager, are considering sending a “friend” or “follow” request to a subordinate employee for the sole purpose of gaining access to that person’s “private” page. Is this ethical? Should it be legal? Would it be ethical (or legal) to ask applicants to open their pages during a job interview? If a manager finds information on a social networking site that may warrant disciplinary action, such as abusive comments about fellow employees or threats against the safety of the workplace, should the manager act on it in his or her managerial capacity? Is it ethical (or legal) for an employee to use a smartphone to secretly record an end-of-year performance evaluation? [Based on Marie-Andrée Weiss, The Use of Social Media Sites Data by Business Organizations in Their Relationship with Employees, 15(2) J. INTERNET L. 16 (2011).]


2.8 In April 2011, Brittany Teofilo left the Stanford Graduate School of Business to become the founder and CEO of, a securities brokerage firm specializing in helping young companies use the Internet to raise money from the public. Her company went public in March 2013. In February 2014, Teofilo personally sold one million shares of stock for $75 million. She used $12 million of the proceeds to buy a large house in Atherton, California, an easy commute to the company’s Silicon Valley offices. Teofilo still owns another four million shares. employs thirty senior computer programmers who are paid a starting salary of $135,000 and given stock options potentially worth millions. The company also employs five janitors who empty the trash, clean the bathrooms, and vacuum the senior programmers’ work areas. These janitors are paid approximately $15,000 a year. Due to the astronomical cost of living in Silicon Valley, several janitors with children have second jobs and rent out space in their one-bedroom apartments to make additional money to support their families. Four of the company’s janitors are non-English-speaking immigrants from Cambodia who are desperate for employment and, as a result, are willing to work for the low salary.

Although there is a large pool of unskilled workers willing to work as janitors for $15,000 a year, the market for skilled programmers is so tight that has had to institute special incentives to keep the programmers happy. Most recently, a senior programmer was given a Tesla sports car to celebrate the completion of an important piece of code.

What ethical and business considerations should a corporation’s board of directors and its CEO consider when setting the salaries for the different types of workers it employs? What role, if any, should the government play beyond establishing a minimum wage? For example, should the Securities and Exchange Commission require public companies to disclose the ratio of CEO pay to that of the average worker?