2004 AGSM Conference: Hypothetically Speaking

AUTHOR: Editor   DATE: 30.11.04   ISSUE 3, 2004

Hypotheticals are powerful learning tools popularised by UK lawyer and academic Geoffrey Robinson. The interactive formula involves a plausible scenario and a panel of ‘executives’ who need to make decisions as the scenario unfolds.

{	AGSM’s hypothetical put issues of Corporate Social Responsibility under the microscope.

PHOTO: David Symth (Panel discussion)

The Hypothetical was originally conceived by Socrates, developed by Harvard Business and Law schools, and is growing in popularity amongst corporate Australia.

The panel included Michael Hawker (IAG), Katie Lahey (BCA), Helen Trinca (BOSS Magazine), Lucy Turnbull (Turnbull & Partners), Regina Hill (Effective Consulting), Ros Kelly (ERM), Rob McLean (AGSM), Christopher Messina (AGSM MBA Student) and Dr David Morrison (University of Queensland).

AGSM’s hypothetical put issues of Corporate Social Responsibility under the microscope. It examined the moral and ethical dilemmas behind everyday decisions made by the Board and executive team of Biolife, a biotech with access to a revolutionary development in genetic engineering.

The participant’s choices, and the debate and thinking behind those choices, offered valuable insight into how managers make decisions in the real world. As the scenario unfolded, the tensions between commercial imperatives like shareholder value at the expense of ethical issues, came to the fore.

The hypothetical explored the highly controversial topic of CEO remuneration asking the question “Are ‘super’ salaries ethical?” A diverse range of views was put forward. One panellist argued that there should be greater salary parity between all employees of Biolife while other panellists argued that the market sets salaries and that compelling salary packages should be offered to strategic employees to retain them.

Finally, a question about accepting corporate hospitality provoked extensive debate on the ethics of information. The risks of compromising independence through sharing resources and hospitality were contrasted with the need for an organisation to be open with the public, including media and other stakeholder groups.

The session was highly entertaining and deeply insightful. In a lively and good humoured debate, different positions were explored and individual values tested.

The fact that both the CEO and Chairman ‘resigned’ from their roles because they felt compromised by decisions made by the rest of the team illustrated the difficulties facing executives today and the complex moral and ethical decisions they make in their pursuit of socially responsible shareholder value.