Page 4 - CIMA SCS Workbook November 2018 - Day 2 Suggested Solutions

SUGGESTED SOLUTIONS

entertainment or other forms of hospitality. Whilst this might be to Novak’s benefit in the short
term, were it to be discovered that you had sanctioned such activity it could seriously damage the
company’s reputation over the longer term, even to the extent that new Novak drugs are rejected
more frequently by the PRA in future.

There is also your personal position to consider. You might be found guilty of criminal charges if
you had knowingly approved acts of bribery in your position as Executive Director of a quoted
company.

As a member of CIMA, I must demonstrate the highest levels of integrity, and therefore would not
be willing to be associated with potentially unlawful or unethical acts.

Recommendation

It is worth meeting with Richard Stilton to get further detail on what he is proposing. Particular
emphasis should be on finding out more about his track record in helping companies such as
Novak, and also what other clients he has worked for and any testimonies from them.
Furthermore, precise details should be given on what his expense budget is to be used for before
any decision on appointing him is made.

EXERCISE 2

Email

To: Anton Frind, Director of Research
From: Senior Manager
Subject: NX1 and activist threats

The purpose of this email is to evaluate the benefits and risks of investing in NX1. It will then
consider possible ethical stances that Novak might adopt in response to the recent threats from
activists over testing on animals.

NX1

Benefits

The first main benefit of committing to research in NX1 is that it is consistent with Novak’s sense
of mission and corporate values. Our public statement is that “Novak’s mission is to provide
society with innovative and effective solutions to disease”, and the development of a new drug to
combat Algernon’s disease would certainly fit with this. Furthermore, we have a stated corporate
value that our research “will be driven by the needs of consumers”. As there is currently no drug
on the market to combat this disease, there is certainly a consumer need for one to be developed.

Secondly, investing in NX1 would confirm the company’s CSR stance on tackling disease. In our
latest annual report, we state that we have a commitment to developing countries. This is shown
in more than 1 way, such as providing training to health workers, and making products affordable.
Investing in NX1 would demonstrate further commitment to good CSR practice, which can only
serve to enhance the company’s reputation internationally.

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