Situation 1 A major conglomerate has fallen into a debt trap. This is a result of continuous investment of money by the promoters into risky ventures after diverting funds and loans through the flagship and profitable listed public company of the conglomerate- Company X. As a last ditch effort, the promoters have now decided to jump into the alcoholic beverage industry and wishes to ensure that they are able to attract the young and impressionable population through personalized advertising and surrogate marketing. The conglomerate has also decided to temporarily payback loans taken by a loss making company within the conglomerate- Company Y. This will be done by silently diverting a loan which the Company X will be taking from a bank for opening the alcoholic beverage business. Question 2: Explain the ethical aspects of the decision of the conglomerate to diversify into the alcoholic beverage industry and the choice of the target customer base chosen for the activity.
Situation 1
A major conglomerate has fallen into a debt trap. This is a result of continuous investment of money by the promoters into risky ventures after diverting funds and loans through the flagship and profitable listed public company of the conglomerate- Company X. As a last ditch effort, the promoters have now decided to jump into the alcoholic beverage industry and wishes to ensure that they are able to attract the young and impressionable population through personalized advertising and surrogate marketing. The conglomerate has also decided to temporarily payback loans taken by a loss making company within the conglomerate- Company Y. This will be done by silently diverting a loan which the Company X will be taking from a bank for opening the alcoholic beverage business.
Question 2: Explain the ethical aspects of the decision of the conglomerate to diversify into the alcoholic beverage industry and the choice of the target customer base chosen for the activity.
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