Hosted by Dr. William J. Frey

Jeopardy Hosted by Dr. William J. Frey

Hewlett-Packard Case Hughes Case Corporate Governance Corporate Governance 100 100 100 100 200 200 200 200 300 300 300 300 400 400 400 400 500 500 500 500

Row 1, Col 1 Who is CarlyFiorina? CEO of Hewlett-Packard from 1999 until February 2005, this individual also ran for senate in California in 2010

1,2 What are analogue to digital computer chips? Hughes Aircraft was responsible for manufacturing these for use in military hardware.

1,3 What is corporate governance? “The system of allocating power in a corporation that determines how and by whom the company is to be directed.”

1,4 What are some of the provisions of Sarbanes-Oxley? 1. Provide increased protection to whistle-blowers 2. Require adherence to an established code of ethics 3. Provide "full, fair, timely and understandable disclosure" 4. Require maintenance of “ honest and ethical" behavior. 5. Mandate reporting ethics violations promptly 6. Insist on compliance with "applicable governmental laws, rules, and regulations"

2,1 What is pretexting? This method of investigation involved investigators requesting information from operators orally, over the phone, pretending to be someone else if necessary

2,2 Who was Frank Saia? This Hughes official, manager of micro- circuit manufacturing, threw his glasses at Margaret Goodearl when told that she was considering initiating a harassment complaint against him.

2,3 What is the agency approach to corporate governance? Because this approach assumes that manager and owner interests diverge it sets as the central problem keeping managers faithful to owner directives.

2,4 What are the Federal Sentencing Guidelines? • The strategy of this government • approach to law breaking is to • provide incentives for corporations • to have in place serious and effective • compliance procedures.

3,1 Who is Jay Keyworth? This HP board member was found to have leaked information about board proceedings to the press and asked to step down from his position.

3,2 What are the Temperature Cycle, Constant Acceleration, Mechanical Shock, and Hermeticity tests? These tests carried out by Hughes test operators were necessary to ensure that the chips could operate effectively under battle conditions.

3,3 What is the stewardship approach to corporate governance? This approach assumes that managers can be altruistic and therefore that the central problem in corporate governance is to create an environment in which managers find work meaningful and fulfilling

3,4 What are the three parts to a compliance approach to ethical behavior? 1. Identifying minimum levels of acceptable conduct and codifying these into rules. 2. Putting into place systems to monitor behavior. 3. Administering punishments to those not in compliance.

4,1 Who is Tom Perkins? This board member resigned in protest of the board deciding to fire Keyworth. Later he claimed that he also resigned because his privacy was invaded by pretexting during the Kona II investigations.

4,2 What is the Inspector General Office of the US Department of Defense? • Margaret Goodearl and Ruth • Ibarra brought documented evidence • of Hughes test skipping here.

4,3 What is the principal or originator of the action and the agent or executor of the action? According to agency theory, an action breaks down into these two dimensions.

4,4 What are the duties of deliberation and candor? According to Dunn, the most fundamental duties of a director rely entirely upon the absolute trust that each director must have in one another’s confidentiality

5,1 Who are Patricia Dunn and Tom Perkins? These two HP board members were initially allies but became bitter enemies as a result of the leak investigation. One represents the agency approach to corporate governance while the other leans more toward the stewardship approach

5,2 What is a qui tam (on behalf of) lawsuit? What is the name of the lawsuit initiated by Goodearl and Ibarra to bring to the attention of the government Hughes’s wrongdoing?

5,3 What are the Federal Sentencing Guidelines? These require “exercising due diligencein hiring and assigning personnel to positions with substantial authority

5,4 What are the components of a values-based approach to corporate conduct? • (1) identify and formulate values. • (2) encourage employees to adopt values as • core commitments through training • programs, ethics audits, and corporate codes. • (3) respond to values "gaps“ or challenges by • means of moral support.

Hosted by Dr. William J. Frey