Institute of Management Technology

Hyderabad

Course Handout

First Semester (Batch 2013 – 2015)

Course Title: Ethics, Responsibility & Governance Course Code: MGMT 551

Program: PGDM / PGDM (Finance) / PGDM (Marketing) Credits: 3

Instructor-in-charge: Dr. Srividya Raghavan

Instructors – Dr. S.Sailaja (Sec A); Dr. Srividya Raghavan (Sec B); Dr. Andal Ammisetti (Sec C)

Email id (@imthyderabad.edu.in) – saisailaja; srividyar; aandal

Course Objective

As a compulsory general management course in the first semester of the business management

program, „Ethics, Responsibility and Governance‟ is designed to provide an overview of

responsibilities and obligations of a business as a social, economic and legal entity. This course aims

to provide a framework for examining moral obligations and ethical decision making through the lens

of various theories of ethics. It provides a perspective on the social responsibility of a business and

deliberates critical issues of corporate governance mechanisms. The objective of the course is to

provide a primer on how businesses should think, act and behave as a responsible social unit that

exists for the benefit of the society and its various stakeholders.

Learning Outcomes (LO)

At the end of the course the students will be able to:

1. Appreciate the importance of ethical thinking in business context and understand how ethical

thinking goes beyond compliance with laws and regulations.

2. Critically analyze a context of ethical dilemma through the application of theories of ethics such

as Universalism, Rights, Distributive Justice, Ethics of Care and Virtue Ethics

3. Make balanced decisions in situations of ethical dilemma using ethical decision making models.

4. Understand the need for organizations to be socially responsible and adopt sustainable business

practices.

5. Understand the role of corporate governance and top management in providing the overarching

strategic direction to business

6. Understand the need for internal and external corporate governance mechanisms in protecting

shareholders‟ interest

7. Understand the functioning of top management and the need to balance the interests of various

stakeholders.

8. Understand the need for compliances and external controls in management of business

Text book

„Ethics, Responsibility and Governance‟ Compiled by S. Subramanian and Published by Tata

McGraw Hill for IMT Hyderabad

Reference Books

1. Banks, Erik., “Corporate Governance”, John Willy Publishers

2. Velasquez, M.G., “Business Ethics: Concepts And Cases” 6th Economy Edition, Prentice Hall

of India

3. Fernando, A. C., “Business Ethics & Corporate Governance” 2nd

Economy Edition, Pearson

Education

4. Monks, R. & Minow, N., “Corporate Governance”, Prentice Hall India

5. Ferrell, O.C., Fraedrich, J, Ferrell, L., “Business Ethics: Ethical Decision Making and Cases”,

Cengage Learning

6. Collins, D., “Essentials of Business Ethics”, Wiley Publishers

7. Kotler, P. & Lee, N., “Corporate Social Responsibility”, Wiley Publishers

8. Werther, W.B., & Chandler, D., “Strategic Corporate Social Responsibility: Stakeholders in a

Global Environment”, Sage Publications

ETHICS, RESPONSIBILTY AND GOVERNANCE (ERG)

Session Topic Content Readings & Cases

SECTION I: CORPORATE ETHICS

(1)

2nd

July

Introduction

.

Introduction to the course content:

Ethics, Responsibility and Corporate

Governance (CG) – how they are

linked.

Briefing on course requirements

Course handout

Text Book

(2)

4th July

Ethics, Morals

& Values

Conceptual understanding of various

concepts.

(Terms often confused or used inter-

changeably)

Lecture and Discussion

Chapter 1: Introduction to ethics

and CG (pgs 5-41)

Additional Reading (AR) 1:

“Linking Strong Moral Principles

to Business Success”

Knowledge@Wharton

(3,4)

9/11th July

Principles of

Ethics

Theories and principles to use as lenses

for examining contexts

Chapter 2: Principles of ethics

(pgs. 42-81)

Lecture and Discussion Additional Reading: Global

Approaches to Anti-Corruption

(HBS 9-902-062)

(5)

16th July

Ethical

reasoning

Systematic ethical decision making.

Situations of personal value conflict

and how to deal with them.

Case Discussion

Chapter 4: Ethics and Ethical

reasoning.(pgs 82-105)

Text Book - A note on ethical

decision making (pgs 250- 266)

Case 1: Martha McCaskey

(HBS 9 403 114)

(6)

18th July

Ethical

context

w.r.t. Business objectives and market

development

Case Discussion

Chapter 5: Organizational Ethics

and the law (pgs106-133)

Chapter 6: The Corporation and

its Stakeholders (pgs 134-155)

Chapter 8:Business-Government

Relations (pgs 156-179)

Case 2: GE Healthcare in India:

An (Ultra) Sound Strategy (UV-

1038)

(7)

23rd

July

Ethical

context

IPR – market dynamics

Case discussion

Case 3: Hollywood in India (A)

(HBS 9 711 017)

(8)

25th July

Ethical

context

wrt. Customers wellbeing

Case Discussion

Chapter 15: Consumer Protection

(pgs 180-201)

Case 4: On Weldon's Watch:

Recalls at Johnson & Johnson

from 2009 to 2010 (HBS: 9 311

029)

(9)

30th July

Ethical

context

w.r.t. Employees wellbeing

Case Discussion

Chapter 16: Employees and the

corporation (pgs 202-224)

Chapter 17: Managing a diverse

workforce (pgs 225-249)

Case 5: Wal-Mart – A Case of

Employee Discrimination - Multi

Media case study

(10)

1st Aug

Building

ethical

organization

Case and Article Discussion General reading: Business

Standard Article -

http://www.business-

standard.com/article/politics/kick

back-nation-

113060700972_1.html

Case 6: Infosys in India-

Building a Software giant in a

corrupt environment (HBS-9-

701-030)

SECTION II: CORPORATE SOCIAL RESPONSIBILITY

(11)

6th Aug

CSR –brief

historical

perspective-

Current

Definition-

Modern

Practices

Lecture and Discussion Chapter 18: The Community and

the Corporation (pgs 268-289)

Additional Reading 2:

Competitive Advantage and

CSR(HBR-R0612D)

(12)

8th Aug

Increasing

positive

contribution-

CSR practices

marketing

gimmick?

Case Discussion Chapter 3: Corporate Social

Responsibility (pgs 291-213)

Case 7: ITC e-Choupal:

Corporate Social Responsibility

in Rural India (HKU765-PDF-

ENG

Additional Reading: Corporate

Social Responsibility in India:

No Clear Definition, but Plenty

of Debate: India

Knowledge@Wharton

(http://knowledge.wharton.upenn.

edu/india/article.cfm?articleid=46

36 )

(13)

13th Aug

CSR Vs Profit

Vs

Government

Role – UN

Global

Compact

Lecture and Discussion Tata: Leadership With Trust

(Available in Text book)

(14)

15th Aug

Development

Vs

Environment

Protection

Lecture and Discussion Chapter 10: Ecology and

Sustainable Development in

Global business

Case 8: Vedanta in Orissa- Multi

Media case study

Three small videos related to

Vedanta’s Niyamgiri project

(15)

20th Aug

Environmental

Protection

Case Discussion Chapter 11: Managing

Environmental Issues (pgs 337-

360)

Case 9: Special Economic Zones

in India: Public Purpose and

private property (A)

Additional Reading 3: Tiffany &

Co: A Case Study in Diamonds

and Social Responsibility: India

Knowledge@Wharton

(http://knowledge.wharton.upenn.

edu/india/article.cfm?articleid=40

99 )

(16/17)

22nd

/27th

Aug

Sustainable

Practices,

Legal issues

and

Reporting-

Triple

Bottom-line

Reporting

Lecture and Discussions

Karmayog’s Rating of CSR

activities of Indian firms- Study

of website www.karmayog.com

and ISO 26000 (from ISO

website)

SECTION III: CORPORATE GOVERNANCE

(18)

29th Aug

Ethical

leadership

Ethical leadership Case 10: HP Company: CEO

Succession in 2010 (HBS 9-411-

056)

(19/20)

24th/25

th

August

Practioner

Session

Corporate

Governance

Introduction

Managing public limited firms –

Agency problems - context of M&A

Why governance? – Changes in

eighties - Cadbury Report, Hampel

Report and OECD Committee

Recommendations – SOX Act.

Lecture and Discussion

Chapter 9: Corporate

Governance: Principles and

Practices (pgs. 386-419)

Chapter 14: Stockholder Rights

and Corporate Governance

Additional Reading 4: Mergers

& Acquisitions: legal context:

basic framework for Corporate

Governance (HBS 9 803 200)

(21/22)

3rd

/5th Sept

Corporate

Governance

Global Corporate Governance models

Lecture and Discussion

Text Book pgs: 421-426 on three

forms of CG in UK, Germany

and Japan

(23)

10th Sept

Internal

corporate

governance

mechanisms

Role of Board (Directors); Functions

of the board;

Case Discussion

Case 11: Corp: Assessing the

board invitation

Additional Reading 5: HBR Sept.

2002: What makes great boards

great

Additional Reading 6: HBR Nov.

2006: How Well run boards make

decisions

(24)

12th Sept

Board

management

Corporate control, Agency relationship

and Activists shareholders

Case Discussion

Case 12: Barnes and Nobles Inc.:

The Yucaipa Proxy Challenge.

(IVEY W11506)

(25)

17th Sept

Internal

corporate

governance

mechanisms

Internal corporate government

mechanism

- Whistle blowers

Case Discussion

Case 13: Olympus and the

Whistle Blowing President

(IVEY 12751)

(26)

19th Sept

Internal

corporate

governance

mechanisms

Internal corporate government

mechanism

- accounting issues

Case Discussion

Case 14: Worldcom Inc.What

Went Wrong? (HBS 905M43-

PDF-ENG)

or

Case: Accounting fraud at

Worldcom (HBS 9 104 071)

Reference Case: A letter from

Prison (HBS 9-110-045)

(27)

24th Sept

Internal

corporate

governance

mechanisms

Short term-long terms goals

Case Discussion and discussion on

reporting

Case 15: Lehman Brothers:

Crisis in Corporate Governance

(NACRA NA0176)

(28)

31st Aug/1

st

Sept

Practitioner

Session

External

mechanisms

Hostile takeovers and Corporate

Control activity Lecture and

Discussions

Corporate Governance Lessons from

Financial Crisis Lecture and

Discussions

Lecture and Discussion

Additional Reading 7: The Future

of Corporate Governance (HBS

Digital Chapters – BEP029)

(29)

31st Aug/ 1

st

Sept

Practitioner

Session

Corporate

Governance in

India

Case Discussion Chapter 18: Corporate

Governance in India (pgs 427 -

445)

Case 16: Corporate Governance

Failure at Satyam (HKU889-

PDF-ENG)

(30)

26th Sept

Review of course learning

PRACTIONER SESSIONS

Name Designation Company Place

1 Mr. Shriram

Subramanian

Founder and MD Ingovern Research Services

Pvt. Ltd

Bangalore

2 Mr. N.V. Subbarao Co-founder and CEO Reboot Systems (India) Hyderabad

ASSESSMENT PLAN

Component Description Weightage LO Assessed Time line

1 CP 30% (15 +15) LO 1-8 Aug 30th and Oct 4

th

2 Debate 10% (5 + 5) LO 2, 3.4 1st and 27

th August

3 Written Report & Presentation 10% (5 + 5) LO 5,6,7,8 10th Oct

4 Activities (4) 20% ( 5% each) LO 1, 2,3 4 5th Aug

5 End Term 30% LO 1-8 21st Oct.

Case Analysis (30 marks):

Case Analysis is done at three levels – One at the individual level, two at study group level and three

at the class level. On days that students have a case analysis, students must discuss the case in their

study groups and submit a case analysis note one day before the class (4:30 pm on Monday and

Wednesday). Assessment is done on level of understanding the case facts, critical thinking and

decision making.

Debate (10 marks):

Early in the semester the class will be divided into ten teams (5-8 students). There are two

debates/discussions for the course. This will be spread across the sessions.

The first debate is in the area of ethics. This will be an open debate that must demonstrate an ability to

develop a logical argument/point of view (POV). Evaluation is on the level of preparation on topic

given, critical thinking, ability to articulate point of view and ability to defend point of view.

In the second debate student groups work with topics of CSR. Each topic will be allocated to two

teams, each taking opposite views. Each team prepares a paper (not to exceed 10 pages) describing its

position and arguments. Supportive documentation and references are required. Each team will make

a 5 minute argument followed by a counterargument. The debate lasts 20 min (Giving each team 2

opportunities to present their POV). The softer parameters of the presentation will be assessed on

persuasiveness, creativity, accuracy, and responsiveness to the opposing view-points.

CG Report and Presentation (10):

Each student has to choose a listed Indian firm and analyze its corporate governance practices in

comparison with Infosys Technologies ltd on a set of parameters. The parameters are

1. Board Composition

2. Audit committee practices

3. Ownership Structure

4. Auditors

5. Regulatory Compliances

Activities (20 marks):

There are series of activities linked to ethical decision making that is done in class. The evaluation is

done on level of involvement, application of knowledge and ability to learn from the activity.

End term Exam (30 marks):

A case based comprehensive exam covering all topics to assess understanding of theory and

application of the same.