Reference no: EM132192250

You are the CEO for Baby Soft, a publicly owned fortune 500 company that sells everything from soaps and shampoos, to medications and over the counter pain relievers. In a rash of criminally insane activity, an individual went into various stories in a major American city, filled up Baby Soft pain reliever capsules with cyanide, and put them back on the shelves poisoning 7 people to death. After its preliminary investigation, Baby Soft learned quickly that this was an isolated activity of one person in the city, and not anyone affiliated with company. In short, legally, the company is clear of any criminal behavior. As the CEO of the company, how should you respond to this situation? Write your response in the form of a letter to your shareholders. (Below are three possible options, although you are free to create your own.) In your response, you must give reasoning for your decision as it pertains to one of the following theories of corporate social responsibility: classical (Friedman), neo-classical (Bowie's Moral Minimum), or stakeholder (E. Robert Freeman). Be sure to indicate to your shareholders which management style you are employing and use the terms "shareholders," "stakeholders" or "moral minimum" in your letter. Although you don’t need a counter argument with this activity, be sure you offer critical insight.

(a) Do nothing. Because the company has not done anything wrong, is operating within the law, the company can do nothing more than let the proper legal authorities investigate, and prosecute the person. (Least Costly and what the shareholders most want)

(b) Recall regionally, but not national, quietly dealing with the situation and avoiding national media attention (more costly than A, but less than C)

(c) Issue a national recall of the product, instituting packaging changes that would prevent the action from happening again. (Most Costly)