REL 228/MGT 228
Business, Ethics, and Society
Prof. Douglas Lamont
WEEK SIX: LECTURE/DISCUSSION
Theme for the week: In judging whether corporate America is serious about
reforming itself, CEO pay remains the acid test. Also shareholders worry
about who will succeed a dominant CEO, such as Warren Buffett and
Michael Eisner. The common good and corporate capitalism
Warren Buffett, 2004 Letter to Shareholders of Berkshire Hathaway.
I. CEO pay and succession
Council of Institutional Investors
. Ann Yerger, deputy director says “It’s pretty
clear [the ouster of Eisner as chairman of the board] hasn’t mollified some folks.
Former Senate Majority Leader George Mitchell’s promotion to chairman did not
definition of independence for the chairman and the board;
because, Mitchell’s law firm Piper Rudnick has received fees from Disney within
the last five years.
. Nell Minow, the editor, welcomed this
change in corporate governance at Disney.
Charles Elson, a professor of
corporate governance at the University of Delaware,
said the chairmanship
for Mitchell was unlikely to satisfy Disney shareholders. “It adds fuel to the fire.”
. CEOs tend to make lousy clients for defense lawyers. CEOs
don’t always follow direction very well, and sometimes they take a bad situation
and make it worse.
, the New York hotelier was probably not
acting on her lawyer’s advice when she said “only the little people pay taxes.”
former president of Enron forfeited his Fifth Amendment rights
and agreed to testify before Congress in 2002 about Enron’s collapse. Excellent
defense lawyers tell their CEO clients: “Never lie to me, never pay me late, and I
run the trial.”
was known to micromanage. She should have
taken the Fifth and remained quiet.
Tim Burt and Elizabeth Wine, “Disney board to examine post-Eisner
future at two-day strategy session,”
, March 8,2004, p. 1. Joshua
Chaffin, “ Celebrities on trial warned: beware of the Martha ‘syndrome’,”
, March 8, 2004,
Failure to admit and surrender guilt
to priests in Confession, lawyers in pre-
trial motions, and judges and jury during trail because our immoral, unethical, and
illegal actions have been transformed into
. We must repent our guilty
actions and attitudes, and we must rid ourselves of “false guilt” or shame,
particularly when it results from internalizing and making our own the negative
judgments others have made about us. The capacity by which one recognizes