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`
 

v à
  
£ Suppressed evidence for decades
£ Asbestos inhalation was killing their
own employees through lung cancer
and mesothelima
£ Company¶s medical staff collaborated in
the cover-up, for reasons we know
£ Illustrates the fine line between
acceptable and unacceptable
managerial behaviour
`
 

v 

£ ainth largest bank in the US had to be saved
from insolvency due to bad judgement and
80% of its equity now belongs to Federal
Deposit Insurance Corporation
£ Its chairman in 1976 declared that within five
years the magnitude of its lending would
match that of any other bank
£ Pursue a course of action that threatened to
bankrupt the institution, ruined their
reputation, investments & jobs of employees
`
 
 

v 
 

£ muilty of 2000 counts of mail and wire fraud,

accepting a fine of $2 million and putting up an
$8 million fund for restitution to 400 banks
v 
 


 


v !" Professor of Sociology at

meorge Washington University concluded
£ In the last 10 years, roughly 2/3rd of America¶s
500 largest corporations have been involved in
varying degrees, in some form of illegal
behaviour.
  !"#$%&'
(() %'!%*'!%*+ '' !


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#
 "$
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O

 

Was more than 40 years worth of

Manville executives all immoral?
÷

v 2he people involved were probably
 

&
 for the
most part, not very different from
you & me
v Found themselves in a dilemma,
and solved it in a way that seemed

  

, deciding not to
disclose information that could hurt
their product

÷` ÷`÷` 
v 2he activity is not ³really´ illegal or
immoral
v 2he act is in individual¶s or corporation¶s
best interest
v It is ³safe´ & will never be found out
v Because the act helps the company, the
company will condone it

V  
 



&
 
 


'

(
÷ 
v Manville Corporation ± Looking for safer
ways to develop safer working conditions
v Fine line between acceptable &
unacceptable managerial behavour
v Profit maximization Vs illegal conduct
v Knowing µhow far¶ is µtoo far¶
v Mostly retrospective evaluation
v We do come across decisions about use of
tobacco, clean air, use of chemicals,
polythene etc.
j  


v Conscience alone does not deter everyone
v 2o know the motivations and instincts that
underline corporate misconduct
v Managers are not paid for taking risk but
to know which risks are worth taking
v Independent Audit system ± Internal &
External & surprise audit (frequency)
v 2he most effective deterrent is to heighten
the perceived probability of being caught ±
e.g. empty patrol car
V

) 
) 
(