RESOLVING ETHICAL BUSINESS CHALLANGES :QUESTIONS • EXERCISES1. Identify the ethical and legal issues ofwhich Albert needs to be aware.2. Discuss the advantages anddisadvantages of each decision thatAlbert could make and has made.3. Identify the pressures that havebrought about these issues. PART 2: ETHICAL ISSUES AND THE INSTITUTIONALIZATION OF BUSINESS ETHICS"This isn't good, Mary. A couple of and selling more and more to pull his ownanalysts were just fired for doing that at abig firm last week," said Albert.Several weeks later the people some of his uncle's friends' portfolios werewho were sending Mary the obnoxious losing significant value. Other matters,messages were fired. Mary was also asked however, were causing him even moreto see the head of her division. When sheportfolio, as well as those of his clients, intothe black. He was getting worried becauseanxiety. The previous week Barry had calledhim, asking for some inside informationcame to his office, he said, "Please shutthe door, Mary. I have some bad news. I on several companies that he was workingknow that you weren't involved with what with for an IPO. Albert knew that thiswas happening with the e-mail scandal; could be construed as insider informationhowever, you did forward messages that and had said no.contained such material. As a result, I haveno alternative but to give you your twoweeks' notice. I know this is unfair, but a while. I need to score big because ofI have my orders. Because of this mess, the holidays. You probably don't know,the SEC wants to check all your tradesfor the last eight months. It seems to be aformality, but it will take time, and as you looked upon favorably. I'm not asking forwell know, the chances of going to anotherfirm with that hanging over your head are Is that clear enough for you, Al? E-mail itslim. I'm sorry that it's only two monthsuntil the holidays." That night Mary fell hung up.into a depression.To exacerbate the situation, Albert'sparents were flying in from the People's you. I want you to buy some stock for aRepublic of China. They were not happy few friends and me. When it goes to $112,with Albert's marriage to a non-Chinese I want you to sell it. We'll pay the taxeswoman, but they had consoled themselves and give you a little bonus for Christmas asthat Mary had a good job. They had also well. I want you to buy tomorrow as soonsaid that if things should go badly for themin New York, they could always come tothe parents' retirement home in Taiwan. See you tomorrow."However, the idea of leaving the UnitedStates, attempting to learn Mandarin, and QUESTIOONS · EXERCISESraising children in an unfamiliar culture 1. Identify the ethical and legal issues ofdid not appeal to Mary.Albert was also having someproblems. Because their income was cutin half, Albert tried to make up for theloss by trading in some high-risk markets,such as commodities and precious metals.However, many of these investmentsturned sour, and he found himself buyingToday, Barry called again and said,"Look, Al, I've been doing you favors forbut what I've been doing for you couldbe construed as spinning, which is notthe IPO information–I'm demanding it.over by tomorrow morning." Then BarryAn hour later Albert's supervisorcame in and said, "“Al, I need a favor fromas the market opens. Here are the accountnumbers for the transaction. I must run.which Albert needs to be aware.2. Discuss the advantages anddisadvantages of each decision thatAlbert could make and has made.3. Identify the pressures that havebrought about these issues."This case is strictly hypothetical; any resemblance toreal persons, companies, or situations is coincidental. RESOLVI NG ETHIC AL BUSINESSCHALLENGES*Albert Chen was sweatingprofusely in his Jaguaron the expressway as hethought about his optionsand the fact that Christmaspeople had engulfed bothhim and Mary.He had graduatedwith honors in financeand had married Mary inhis senior year. They hadboth obtained prestigiousbrokerage jobs in the NewYork area, and both hadbeen working killer hoursJohn F. Kennedy International Airport, seemed to to develop their accounts. Listening to otherbe looking up from an abyss, with no daylight to brokers, both had learned that there were somebe seen. Several visits and phone calls from various added expenses to their professions. For example,and the Chinese New Yearwere at hand. He and hiswife, Mary, who were ontheir way to meet Albert'sparents at New York'sCHAPTER 4: THE INSTITUTIONALIZATION OF BUSINESS ETHICSthey were told that brokers need to "look" investigated the company and discoveredand "act" successful. So Albert and Mary that the stock was grossly undervalued.bought the appropriate clothes and cars, She made a few phone calls and found ajoined the right clubs, and ate at the right company that was interested in doing arestaurants with the right people. They hostile takeover. Mary also learned fromalso took the advice of others, which was toidentify the "players" of large corporations acceptable to the union, the union wouldat parties and take mental notes. "You'd do everything in its power to oust the oldbe surprised at what information you hear management-by striking, if necessary-with a little alcohol in these people," saidone broker. Both started using this strategy, started to materialize, Mary told severaland five months later their clients began to of her best clients, who in turn did verysee significant profits in their portfolios.Their good luck even came fromher father that if a new management wereand welcome the new one. As thingswell on the stock. This increased her statusin the firm, which kept drawing biggerstrange places. For example, Albert had clients.an uncle whose work as a janitor gavehim access to many law offices that had public stock offerings (IPOS) of newinformation on a number of companies,especially those about to file for a very hot IPO, he would talk to some ofbankruptcy. Mary and Albert were able to his best venture-capital friends, who thenuse information provided by this uncle to bought the IPO5 and gained some verybenefit their clients' portfolios. The uncle good returns. This strategy helped attracteven had some of his friends use Albert.Albert soon became a player in initialcompanies. Occasionally, when Albert sawsome larger players in the market. By thisTo Albert's surprise, his uncle's friends point in his young career, Albert had madeoften had nest eggs in excess of $200,000.Because some of these friends were quiteelderly, Albert was given permission to buy worked on the stock floor. As they wereand sell nonrisky stocks at will.Because both of them were earning wanted to, he, as a favor, when placinggood salaries, the Chens soon managed to orders to buy shares, would occasionallyinvest in the market themselves, and their put Albert's or Mary's trade before theinvestments included stock in thecompanyfor which Mary's father worked. Aftereighteen months, Albert decided to jump Mary told Albertabout what was happeningship and start working for Jarvis, Sunni,Lamar & Morten (JSL&M). JSL&M's some of the brokers with off-color jokesreputation was that of a fast mover in thebusiness. "We go up to the line and then men. I just don't care for it."measure how wide the line is so that weknow how far we can go into it," was a Albert asked.common remark at the brokerage firm.About six months ago, Mary's father, opening my messages if they come fromwho was with a major health care company,commented that the management teamwas running the company into the ground."If only someone could buy the companyand put in a good management team,"he mused. After the conversation, Marya great many friends.One of those friends was Barry, whotalking, Barry mentioned that if Albertclient order.The first sign of trouble came whenat her office. "I'm getting e-mail fromand even some nude photos of women and"So what are you doing about it?""Well, I've just started not eventhese people," Mary replied."What about messages that requestthat you send them on? What do you dowith those?" queried Albert."I just e-mail them along withoutlooking at them," was her response.

Question

RESOLVING ETHICAL BUSINESS CHALLANGES :QUESTIONS • EXERCISES1. Identify the ethical and legal issues ofwhich Albert needs to be aware.2. Discuss the advantages anddisadvantages of each decision thatAlbert could make and has made.3. Identify the pressures that havebrought about these issues. PART 2: ETHICAL ISSUES AND THE INSTITUTIONALIZATION OF BUSINESS ETHICS&#34;This isn't good, Mary. A couple of and selling more and more to pull his ownanalysts were just fired for doing that at abig firm last week,&#34; said Albert.Several weeks later the people some of his uncle's friends' portfolios werewho were sending Mary the obnoxious losing significant value. Other matters,messages were fired. Mary was also asked however, were causing him even moreto see the head of her division. When sheportfolio, as well as those of his clients, intothe black. He was getting worried becauseanxiety. The previous week Barry had calledhim, asking for some inside informationcame to his office, he said, &#34;Please shutthe door, Mary. I have some bad news. I on several companies that he was workingknow that you weren't involved with what with for an IPO. Albert knew that thiswas happening with the e-mail scandal; could be construed as insider informationhowever, you did forward messages that and had said no.contained such material. As a result, I haveno alternative but to give you your twoweeks' notice. I know this is unfair, but a while. I need to score big because ofI have my orders. Because of this mess, the holidays. You probably don't know,the SEC wants to check all your tradesfor the last eight months. It seems to be aformality, but it will take time, and as you looked upon favorably. I'm not asking forwell know, the chances of going to anotherfirm with that hanging over your head are Is that clear enough for you, Al? E-mail itslim. I'm sorry that it's only two monthsuntil the holidays.&#34; That night Mary fell hung up.into a depression.To exacerbate the situation, Albert'sparents were flying in from the People's you. I want you to buy some stock for aRepublic of China. They were not happy few friends and me. When it goes to $112,with Albert's marriage to a non-Chinese I want you to sell it. We'll pay the taxeswoman, but they had consoled themselves and give you a little bonus for Christmas asthat Mary had a good job. They had also well. I want you to buy tomorrow as soonsaid that if things should go badly for themin New York, they could always come tothe parents' retirement home in Taiwan. See you tomorrow.&#34;However, the idea of leaving the UnitedStates, attempting to learn Mandarin, and QUESTIOONS · EXERCISESraising children in an unfamiliar culture 1. Identify the ethical and legal issues ofdid not appeal to Mary.Albert was also having someproblems. Because their income was cutin half, Albert tried to make up for theloss by trading in some high-risk markets,such as commodities and precious metals.However, many of these investmentsturned sour, and he found himself buyingToday, Barry called again and said,&#34;Look, Al, I've been doing you favors forbut what I've been doing for you couldbe construed as spinning, which is notthe IPO information–I'm demanding it.over by tomorrow morning.&#34; Then BarryAn hour later Albert's supervisorcame in and said, &#34;“Al, I need a favor fromas the market opens. Here are the accountnumbers for the transaction. I must run.which Albert needs to be aware.2. Discuss the advantages anddisadvantages of each decision thatAlbert could make and has made.3. Identify the pressures that havebrought about these issues.&#34;This case is strictly hypothetical; any resemblance toreal persons, companies, or situations is coincidental. RESOLVI NG ETHIC AL BUSINESSCHALLENGES*Albert Chen was sweatingprofusely in his Jaguaron the expressway as hethought about his optionsand the fact that Christmaspeople had engulfed bothhim and Mary.He had graduatedwith honors in financeand had married Mary inhis senior year. They hadboth obtained prestigiousbrokerage jobs in the NewYork area, and both hadbeen working killer hoursJohn F. Kennedy International Airport, seemed to to develop their accounts. Listening to otherbe looking up from an abyss, with no daylight to brokers, both had learned that there were somebe seen. Several visits and phone calls from various added expenses to their professions. For example,and the Chinese New Yearwere at hand. He and hiswife, Mary, who were ontheir way to meet Albert'sparents at New York'sCHAPTER 4: THE INSTITUTIONALIZATION OF BUSINESS ETHICSthey were told that brokers need to &#34;look&#34; investigated the company and discoveredand &#34;act&#34; successful. So Albert and Mary that the stock was grossly undervalued.bought the appropriate clothes and cars, She made a few phone calls and found ajoined the right clubs, and ate at the right company that was interested in doing arestaurants with the right people. They hostile takeover. Mary also learned fromalso took the advice of others, which was toidentify the &#34;players&#34; of large corporations acceptable to the union, the union wouldat parties and take mental notes. &#34;You'd do everything in its power to oust the oldbe surprised at what information you hear management-by striking, if necessary-with a little alcohol in these people,&#34; saidone broker. Both started using this strategy, started to materialize, Mary told severaland five months later their clients began to of her best clients, who in turn did verysee significant profits in their portfolios.Their good luck even came fromher father that if a new management wereand welcome the new one. As thingswell on the stock. This increased her statusin the firm, which kept drawing biggerstrange places. For example, Albert had clients.an uncle whose work as a janitor gavehim access to many law offices that had public stock offerings (IPOS) of newinformation on a number of companies,especially those about to file for a very hot IPO, he would talk to some ofbankruptcy. Mary and Albert were able to his best venture-capital friends, who thenuse information provided by this uncle to bought the IPO5 and gained some verybenefit their clients' portfolios. The uncle good returns. This strategy helped attracteven had some of his friends use Albert.Albert soon became a player in initialcompanies. Occasionally, when Albert sawsome larger players in the market. By thisTo Albert's surprise, his uncle's friends point in his young career, Albert had madeoften had nest eggs in excess of $200,000.Because some of these friends were quiteelderly, Albert was given permission to buy worked on the stock floor. As they wereand sell nonrisky stocks at will.Because both of them were earning wanted to, he, as a favor, when placinggood salaries, the Chens soon managed to orders to buy shares, would occasionallyinvest in the market themselves, and their put Albert's or Mary's trade before theinvestments included stock in thecompanyfor which Mary's father worked. Aftereighteen months, Albert decided to jump Mary told Albertabout what was happeningship and start working for Jarvis, Sunni,Lamar & Morten (JSL&M). JSL&M's some of the brokers with off-color jokesreputation was that of a fast mover in thebusiness. &#34;We go up to the line and then men. I just don't care for it.&#34;measure how wide the line is so that weknow how far we can go into it,&#34; was a Albert asked.common remark at the brokerage firm.About six months ago, Mary's father, opening my messages if they come fromwho was with a major health care company,commented that the management teamwas running the company into the ground.&#34;If only someone could buy the companyand put in a good management team,&#34;he mused. After the conversation, Marya great many friends.One of those friends was Barry, whotalking, Barry mentioned that if Albertclient order.The first sign of trouble came whenat her office. &#34;I'm getting e-mail fromand even some nude photos of women and&#34;So what are you doing about it?&#34;&#34;Well, I've just started not eventhese people,&#34; Mary replied.&#34;What about messages that requestthat you send them on? What do you dowith those?&#34; queried Albert.&#34;I just e-mail them along withoutlooking at them,&#34; was her response.

Accepted Answer

Ethics plays a major role in business. Business ethics include the appropriate business practices…