Read the case study WorldCom in your Boatright and Smith book (chapter 13) AND view the video below on WorldCom.
https://www.youtube.com/watch?v=u_rfIboPyYs
Analysis
1. What is the dilemma?
2. Who were the stakeholders? Please explain.
3. Who are the shareholders in this case? Please explain.
4. What stakeholders exercised defacto control? Why?
5. What stakeholders exercised dejure control? Why?
6. Why weren’t any of the shareholders indicted?
7. Do shareholders have defacto control over managers? What decisions do shareholders typically make? Please explain.
8. WorldCom was the result of misconduct by a few individuals. The Sarbanes-Oxley Act of 2002 addressed three major components of the American system for holding corporations accountable. What are they?
9. What could WorldCom have done differently? Hint answers are in Boatright and Smith (ch. 13) AND Comer and Vega (ch 12-15).
10. What type of program components and program benefits was WorldCom lacking?