Greenco is a manufacturer of environmentally friendly products for the agriculture industry. Its founder, board chairman and

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Greenco is a manufacturer of environmentally friendly products for the agriculture industry. Its founder, board chairman and chief executive officer is Carolyn Crabb, a dedicated environmentalist and, by her own admission, a “hands-on” administrator. You are an independent board member and chair of the company’s audit committee. Over the years, you have come to respect Crabb as a person, but also to see her management style as problematic: She dictates policy without listening to others and frequently makes decisions solely on the basis of environmental considerations, even though they reduce the company’s profits. A shareholder places a proposal to split the offices of CEO and chairman on the company’s annual proxy statement. You believe that if the proposal were adopted it would benefit the company because it would require Crabb to listen to others; you also believe that you would probably be named chairman if Crabb had to give up that title. You think that if the proposal is not adopted, it will be a black eye with institutional investors, who are likely to bail out of its stock. Crabb, however, hates the proposal and, because she owns 30 percent of the company’s stock, can probably prevent it from passing if the company opposes it. What do you say at the directors’ meeting where the company’s response is debated?

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