Strategic management chapter 2
Terms
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- Interlocking Directorates two kinds
- Direct interlocking directorate, indirect locking directorate
- Justice approach to ethics
- Distributive justice, retributive justice, and compensatory justice. Is the act consistant with the cannons of justice and law?
- Two types of BOD members.
- Inside directors, outside directors.
- What is Strategic Vision?
- A description of what the company is capable of becoming
- CEOS with charisma and clear strategic vision have three traits.
- 1) communicate a strategic vision 2) present a role model 3) show confidence in the ability of workers to meet high standards
- Indirect locking directorate
- two firms with members on a third companies BOD
- What are the responsibilities of top management?
- 1) Providing execuitive leadership and strategic vision, manage the strategic planning process
- Due Care:
- The duty of BOD to conscientiously carry out duties
- Carrols four responsibilities and how they relate to Maslows pyramid
- Each step must be satisfied before beginning the next.
- Archie Carrols four responsibilities of business:
- 1) Economic (you must make money) 2) Legal (you must not break the law) 3) ethical (follow general societal beliefs) 4)discretionary (philantropy)
- What are the responsibilities of the board of directors?
- 1) setting corporate strategy, vision or mission 2) succession: hiring and firing of the CEO 3) controlling and monitoring top management 4) reviewing the use of resources 5) caring for stockholder interests
- What is the impact of Sarbanes-Oxley?
- Sarbox formulated board independence and oversight, and protects the crap out of whistleblowers. Also requires that nominating, compensation and audit committees to be staffd by outside directors.
- Individual rights approach to ethics
- Humans have certain rights that must be respected. Does the act respect the rights of individuals involved?
- Direct locking directorate
- two firms with members on one of the others BOD
- How are people nominated and elected to the board?
- 87% of us companies use nominating committees. The rest are via CEO
- What is meant by BOD continuum?
- the range of the degree of involvement from Phantom to catalyst. Smaller companies tend to have less active boards.
- Utilitarian approach to ethics
- actions should be judged by consequences. Does the act satisfy the stakeholders?
- Three approaches to ethics
- 1) Utilitarian 2) Individual Rights 3) Justice
- Inside director
- Officers and executives of the company managed by a given BOD
- What is the role of the board in SM?
- Monitor , Evaluate, Initiate
- Ethics
- The consensually accepted standards of behavior for an occupation
- Milton Friedmans view on Business Responsibility
- Bottom line, baby. Anything else is robbing the stockholders
- Outside director
- Execuitives of another company than that managed by a given BOD