Deck 2: Business Ethics and Social Responsibility

Question 1

The National Collegiate Athletic Association(NCAA) was founded in 1905 to serve as a national regulator and organizer of college football in the United States. It has around 1,100 member schools and regulates a wide variety of intercollegiate sports.
Since its founding over a century ago, the NCAA has refused to allow student athletes in its sports to be paid other than through academic scholarships. This is true even though the organization and its member colleges make millions of dollars off licensing top players' names, images, and likenesses for use in television, videogames, and other media. The NCAA's continuing stance has been that college athletes are "amateurs," and to pay them would destroy the pure competitive spirit and nonprofessional nature of college sports.
In August 2014, a California federal district court judge struck down this long-standing practice, finding it violated federal anti trust laws. The judge ruled that starting July 2016,the NCAA must allow member colleges to create trust funds for student athletes where a portion of their licensing revenue can be deposited and later accessed by them after graduation. The NCAA may cap the amount each student makes at $5,000 per year, but that still adds up to hundreds of millions in revenue potentially redirected back to the players.
The NCAA is in the process of appealing the decision and may also seek a special congressional exemption from anti trust laws (Major League Baseball enjoys a similar exemption). If the decision stands, however, only time will tell how the ruling will affect the NCAA and the atmosphere of college sports in general. 12
Are there potential negative impacts of this decision on college athletes? If so, what does this illustrate about the subtleties and difficulties of ethical decision making?

Answer 1

Case Summary :
The NCAA is an association which is responsible for management of college football in United States. Their revenue is generated through licensing top player names, images for media approach such as television, videogames and images, etc. A district court judge from California found it discrimination to deprive the students of their rightful share of income as it was violating the antitrust laws.
She ruled to give a part of their earning back to the students after graduation. This made them want to be exempted from the antitrust law through special consideration similar to the one that association MLB enjoys.
Potential negative impact on students :
The students would be facing an issue of non professional behavior. They would lose their competitive spirit to play the game. They cannot play the game with pure thoughts about the game alone. These are potential negativities which can be a result if the students get paid.
Ethical decision making their subtleties and difficulties :
Ethical decision making is difficult with the court wanting the students to get paid as they feel that depriving them the money they earn would be a violation of the antitrust law. However, the main function of NACC is to make sure they learn the sport and play it completely fair.
This being the case cannot be assured if such laws get passed. They would have to filter and plan alternate means to retain the purity of the game.
Conclusion :
Unfavorable influence on the students can be found. Also the decision to do the right thing is difficult however they should try to keep the sport and their players professional and true to their sport.

Question 2

The current understanding of solar energy seems inextricably linked with concepts like sustainability, environmentalism, and" going green." There have been ups and downs in the solar business. Starting around 2005, the solar energy industry experienced a boom. The public desire to move toward sustainable energy sources fueled government subsidies, investment in research and development, and other favorable forces. New companies formed and grew rapidly, and the future looked bright. Unfortunately, the boom did not last. When the global economic recession hit, governments and investors were forced to pare back on solar subsidies and investment. Other market forces, such a san influx of Chinese firms oversupplying solar panels at extremely low prices, contributed to a crash in profitability and demand. Many companies went out of business, and those that survived had to reestablish investor confidence and reevaluate their approach. In the past few years, the solar industry seems to have rebounded once more, with solar panel prices again increasing and companies returning to profitability. Supporters tend to view solar power as an ethical solution to the energy crisis because it has the potential to significantly decrease the negative environmental impact of traditional fossil fuels. However, some industry leaders and analysts argue that for the solar industry to truly mature and prosper, it must be founded on solid economic competitiveness, not just ethical and environmental ideals. They say that rather than relying on subsidies and the "sustainability" image, solar companies need to learn how to better utilize standard strategic advantages such as economies of scale and practical product development. If they are right, then perhaps a day will come when solar is no longer a "green" solution, but simply a good solution. 67
What kind of image does the solar industry currently have in terms of sustainability and business ethics? Why does it have this image?

Answer 2

Case summary:
Solar energy is linked with the impression of sustainability, environmentalism etc. In 2005, solar energy experienced a boom which led to the public desire of moving towards sustainable energy sources. But the global recession made the investors and governments to move back on solar subsidies and investment.
Recently solar industry has been active once again and these firms have returned to success. Supporters feel it as the best alternative source to the growing energy crisis. But some industry leaders feel that this should be built on solid competitiveness. If appropriately consumed, solar energy will become a good solution and not just a green solution.
Images of solar industry are:
Solar energy is believed to be a sustainable energy resource. Industries now want to make use of this "green solution" as the alternate resolution to the rising energy crisis.
Solar industries have the image where they are doing something which is useful to people now and in future. It is a source of unlimited energy. They are trying to harvest this energy to help mankind.
They have "green" image because the world has come to understand that the speed at which they are spending all energy resources proves these resources won't last long. They need to look at alternate sources of sustainable power in the imminent future. Solar energy is inexhaustible and can be availed in large amounts. Also by using this, environment would be unharmed and pollution free.
Conclusion:
Industries are making use of solar energy to have a more environment friendly energy system. This image is formed because it existing in plenty and it is renewable.

Question 3

Navigating copyright laws is a two fold challenge for businesses. They must work to protect their own intellectual property to maintain a competitive advantage. Additionally, they must take efforts to avoid copyright infringement of works from other companies. Even unintentional use of copyrighted material can result in enormous fines.Sirius XM Holdings Inc. found this out the hard way. Sirius provides subscription satellite radio services to 26.3 million people and is currently the largest U.S. radio broadcaster based on revenue. Federal copyright laws dictate that the company is required to pay royalty fees for music it broadcasts that was created after 1972. Because federal law does not protect music created before 1972, the company freely broadcasts music from the1950s and 1960s without paying royalties to the artists. Despite following federal law, Sirius XM is engaged in legal proceedings with three major record companies and a number of artists who claim that the company violated state laws. A judge in California confirmed this, ruling that pre-1972 music is protected under state law. The task of determining which music can be legally streamed is especially problematic, especially for a provider like Sirius XM that offers satellite access to subscribers in every state. The cost of paying royalties would amount to a notable cost for the company. However, lawsuits also pose an impending risk. The variations in state and federal copyright laws create ongoing challenges for Sirius XM and other firms. As intellectual property regulation continues to evolve, businesses must exert care to research all applicable laws that relate to intellectual property. 82
Should Sirius XM pay royalties for pre-1972 music even though federal law does not require it?

Answer 3

Case summary:
A company must be careful to follow copyright laws. They must protect their intellectual property and be careful to avoid copyright infringement even through unintentional means. Company SXM provides satellite radio services and is the major radio broadcaster in the Country US according to revenue generation.
Federal laws indicate that no royalty fees need to be paid for broadcasting music which was developed before 1972. Though company SXM followed federal law, they entered into legal proceedings with three record companies because they claim that it violates the state law.
Variations in state and federal law makes it necessary for business to research all possible laws that relates to the use of intellectual property before being used.
Company SXM must pay royalties for music developed before 1972:
Company SXM is liable to pay royalty to the artists. Though federal law has stated that no royalties need to be paid for music before 1972, however state law implies payment of royalties to the artists must be paid. It is necessary to be law abiding be it state or federal law.
Though it will cost the company more for these royalties, it is better to pay than to face lawsuits. Facing lawsuits will make them lose goodwill from their customers.
Conclusion:
Company SXM must pay royalty for music developed before 1972, because the state law has plainly explained it in its statute.

Question 4

The National Collegiate Athletic Association(NCAA) was founded in 1905 to serve as a national regulator and organizer of college football in the United States. It has around 1,100 member schools and regulates a wide variety of intercollegiate sports.
Since its founding over a century ago, the NCAA has refused to allow student athletes in its sports to be paid other than through academic scholarships. This is true even though the organization and its member colleges make millions of dollars off licensing top players' names, images, and likenesses for use in television, videogames, and other media. The NCAA's continuing stance has been that college athletes are "amateurs," and to pay them would destroy the pure competitive spirit and nonprofessional nature of college sports.
In August 2014, a California federal district court judge struck down this long-standing practice, finding it violated federal anti trust laws. The judge ruled that starting July 2016,the NCAA must allow member colleges to create trust funds for student athletes where a portion of their licensing revenue can be deposited and later accessed by them after graduation. The NCAA may cap the amount each student makes at $5,000 per year, but that still adds up to hundreds of millions in revenue potentially redirected back to the players.
The NCAA is in the process of appealing the decision and may also seek a special congressional exemption from anti trust laws (Major League Baseball enjoys a similar exemption). If the decision stands, however, only time will tell how the ruling will affect the NCAA and the atmosphere of college sports in general. 12
Why has this issue become such a controversial topic?

Question 5

The current understanding of solar energy seems inextricably linked with concepts like sustainability, environmentalism, and" going green." There have been ups and downs in the solar business. Starting around 2005, the solar energy industry experienced a boom. The public desire to move toward sustainable energy sources fueled government subsidies, investment in research and development, and other favorable forces. New companies formed and grew rapidly, and the future looked bright. Unfortunately, the boom did not last. When the global economic recession hit, governments and investors were forced to pare back on solar subsidies and investment. Other market forces, such a san influx of Chinese firms oversupplying solar panels at extremely low prices, contributed to a crash in profitability and demand. Many companies went out of business, and those that survived had to reestablish investor confidence and reevaluate their approach. In the past few years, the solar industry seems to have rebounded once more, with solar panel prices again increasing and companies returning to profitability. Supporters tend to view solar power as an ethical solution to the energy crisis because it has the potential to significantly decrease the negative environmental impact of traditional fossil fuels. However, some industry leaders and analysts argue that for the solar industry to truly mature and prosper, it must be founded on solid economic competitiveness, not just ethical and environmental ideals. They say that rather than relying on subsidies and the "sustainability" image, solar companies need to learn how to better utilize standard strategic advantages such as economies of scale and practical product development. If they are right, then perhaps a day will come when solar is no longer a "green" solution, but simply a good solution. 67
Can it truly be potentially detrimental to be known for sustainability?

Question 6

Navigating copyright laws is a two fold challenge for businesses. They must work to protect their own intellectual property to maintain a competitive advantage. Additionally, they must take efforts to avoid copyright infringement of works from other companies. Even unintentional use of copyrighted material can result in enormous fines.Sirius XM Holdings Inc. found this out the hard way. Sirius provides subscription satellite radio services to 26.3 million people and is currently the largest U.S. radio broadcaster based on revenue. Federal copyright laws dictate that the company is required to pay royalty fees for music it broadcasts that was created after 1972. Because federal law does not protect music created before 1972, the company freely broadcasts music from the1950s and 1960s without paying royalties to the artists. Despite following federal law, Sirius XM is engaged in legal proceedings with three major record companies and a number of artists who claim that the company violated state laws. A judge in California confirmed this, ruling that pre-1972 music is protected under state law. The task of determining which music can be legally streamed is especially problematic, especially for a provider like Sirius XM that offers satellite access to subscribers in every state. The cost of paying royalties would amount to a notable cost for the company. However, lawsuits also pose an impending risk. The variations in state and federal copyright laws create ongoing challenges for Sirius XM and other firms. As intellectual property regulation continues to evolve, businesses must exert care to research all applicable laws that relate to intellectual property. 82
How would it affect Sirius XM if access to certain music was limited for subscribers living in or driving through certain states?

Question 7

The National Collegiate Athletic Association(NCAA) was founded in 1905 to serve as a national regulator and organizer of college football in the United States. It has around 1,100 member schools and regulates a wide variety of intercollegiate sports.
Since its founding over a century ago, the NCAA has refused to allow student athletes in its sports to be paid other than through academic scholarships. This is true even though the organization and its member colleges make millions of dollars off licensing top players' names, images, and likenesses for use in television, videogames, and other media. The NCAA's continuing stance has been that college athletes are "amateurs," and to pay them would destroy the pure competitive spirit and nonprofessional nature of college sports.
In August 2014, a California federal district court judge struck down this long-standing practice, finding it violated federal anti trust laws. The judge ruled that starting July 2016,the NCAA must allow member colleges to create trust funds for student athletes where a portion of their licensing revenue can be deposited and later accessed by them after graduation. The NCAA may cap the amount each student makes at $5,000 per year, but that still adds up to hundreds of millions in revenue potentially redirected back to the players.
The NCAA is in the process of appealing the decision and may also seek a special congressional exemption from anti trust laws (Major League Baseball enjoys a similar exemption). If the decision stands, however, only time will tell how the ruling will affect the NCAA and the atmosphere of college sports in general. 12
Who are the various stakeholders of the NCAA? How will each of them be affected by this decision?

Question 8

The current understanding of solar energy seems inextricably linked with concepts like sustainability, environmentalism, and" going green." There have been ups and downs in the solar business. Starting around 2005, the solar energy industry experienced a boom. The public desire to move toward sustainable energy sources fueled government subsidies, investment in research and development, and other favorable forces. New companies formed and grew rapidly, and the future looked bright. Unfortunately, the boom did not last. When the global economic recession hit, governments and investors were forced to pare back on solar subsidies and investment. Other market forces, such a san influx of Chinese firms oversupplying solar panels at extremely low prices, contributed to a crash in profitability and demand. Many companies went out of business, and those that survived had to reestablish investor confidence and reevaluate their approach. In the past few years, the solar industry seems to have rebounded once more, with solar panel prices again increasing and companies returning to profitability. Supporters tend to view solar power as an ethical solution to the energy crisis because it has the potential to significantly decrease the negative environmental impact of traditional fossil fuels. However, some industry leaders and analysts argue that for the solar industry to truly mature and prosper, it must be founded on solid economic competitiveness, not just ethical and environmental ideals. They say that rather than relying on subsidies and the "sustainability" image, solar companies need to learn how to better utilize standard strategic advantages such as economies of scale and practical product development. If they are right, then perhaps a day will come when solar is no longer a "green" solution, but simply a good solution. 67
Does the solar power industry have to move away from its "green" label to become stable, or is there another solution?

Question 9

Navigating copyright laws is a two fold challenge for businesses. They must work to protect their own intellectual property to maintain a competitive advantage. Additionally, they must take efforts to avoid copyright infringement of works from other companies. Even unintentional use of copyrighted material can result in enormous fines.Sirius XM Holdings Inc. found this out the hard way. Sirius provides subscription satellite radio services to 26.3 million people and is currently the largest U.S. radio broadcaster based on revenue. Federal copyright laws dictate that the company is required to pay royalty fees for music it broadcasts that was created after 1972. Because federal law does not protect music created before 1972, the company freely broadcasts music from the1950s and 1960s without paying royalties to the artists. Despite following federal law, Sirius XM is engaged in legal proceedings with three major record companies and a number of artists who claim that the company violated state laws. A judge in California confirmed this, ruling that pre-1972 music is protected under state law. The task of determining which music can be legally streamed is especially problematic, especially for a provider like Sirius XM that offers satellite access to subscribers in every state. The cost of paying royalties would amount to a notable cost for the company. However, lawsuits also pose an impending risk. The variations in state and federal copyright laws create ongoing challenges for Sirius XM and other firms. As intellectual property regulation continues to evolve, businesses must exert care to research all applicable laws that relate to intellectual property. 82
Should Sirius XM be required to comply with both federal and state laws?