Clean Power Company and Energy Cooperative Recommendations

Topics: Fiduciary, Stock, Conflict of interest Pages: 3 (769 words) Published: November 3, 2012
Energy Cooperative and the Clean Power Company Recommendations

Energy Cooperative and the Clean Power Company Recommendations

Energy Cooperative

The ethical dilemmas in this case have to do with conflict of interests. All members of the board of directors have signed agreements that, while serving on the board, they will act without prejudice, without any allegiance to a specific cooperation. “Such codes of conduct, and the consequences of breaking them, then need to be communicated frequently to the staff members” (Gardyn, 2003). The company needs to make it clear what the consequences will be for not following the signed agreement.

The first issue is the misrepresentation. If each director says that he is calling as a director of the cooperative, he is misrepresenting his position to all the clients that he calls. The cooperative has no business making business deals with the personal clients of the board members. If they do this, it may make the personal clients feel that the cooperative supports their interest and really the cooperative has no desire to.

The second issue is the conflict of interest. Each of the board members is acting as a consultant and they shouldn’t be combining the two. The board members are saying to their personal clients that they are on the board of directors when they are really not. This information shouldn’t be told to the personal clients, because the personal clients are not a part of the cooperative. Each separate entity or position the board members hold should be kept separate. If not, it will be hard to draw a line as to what the director is representing and the roles will no longer be clear, with each position.

The cooperative is established to provide information and education. It is not to promote businesses or specific clients. The stakeholders in this organization are the ones that are seeking information. There is a risk that the stakeholders not getting the most accurate information or...
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