Case Study: The Elderly Stockholder By Kathleen Higgens and Robert Solomon FACTS: You are the CEO of a corporation whose board has just decided to cut the dividend to the stockholders. This is a matter of absolute confidentiality, as it could have major effects on your stock prices if the information gets out before implementation of the cut. At a reception, an elderly gentleman, who retired from the company several years ago, approaches you. Virtually all of his savings and much of his retirement income is in company stock. He asks, point blank, whether he should sell some of his stock, in order to obtain some needed funds for living expenses. You know that he knows a "yes" answer will indicate some dramatic decision, such as a decision to cut the dividend, is impending. If you tell him "no," he could lose considerable value on his stock. QUESTIONS: 1. Who are the stakeholders? 2. What additional facts, if any, would you like to know before completing your analysis? 3. What ethical issues are involved at each of the Seven Levels of Integrity (nothing that not every case will have an issue at every level)? Law Contracts and agreements Professional standards Industry standards Local, regional, and area standards Personal relationships Moral and religious standards 4. What are the alternatives? 5. How does each alternative effect each stakeholder with respect to each ethical issue? 6. What is the best answer and why? 7. Do you tell him? 8. What do you say? 9. If you tell him, could it affect your company? 10. Could this affect you or your own job directly? 11. Suppose you tell him and he sells his stock. What problems, if any, does that create for you and/or him?

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Who are the stakeholders CEO Board of Directors Company shareholders including the elderly gentleman Employees Companys reputation and financial stability What additional facts if any would you like t... View the full answer