At first, when I started this assignment, I dove into it digging around on the internet, going to the library, looking up the legal aspects of exactly what had been the technical violations of the laws governing this kind of business merging circumstance. Overwhelmed, and no closer to a clearer understanding of the situation at hand, I just happened to skim over the question again. Chapter 2. I felt this was a clear enough hint as to where to find what I was looking for. I read it, and don’t know why I made it so much more difficult than it needed to be.
The lapses in ethics and coporate social responsibility in the AOL Time Warner situation were actually, quite obvious. Blatent, obvious, and in my opinion, even obscene. Although my knowledge of the actual facts surrounding the merger of AOL and Time Warner is somewhat limited, I can now at least say that I do know enough in the area of business ethics and corporate social responsibility to determine that this situation had a gross lapse in both. AOL failed to show social responsible behavior in almost every feasible area. I do not feel AOL, specifically, acted in the best interests of its investors, its customers, not even its employees.
In the decision making process which must have been done before taking on the multi-billion dollar merger between AOL and Time Warner, AOL exercised no concern for the people involved whom worked for this company, invested in this company, and were counting on this company, as well as its success, with as much as even their entire life’s savings. The general rule, which is outlined in Chapter 2, about what to say and when to say it when faced with an ethical dilemma, one of the rules of thumb is to consider the decisions your audience is facing.
In other words, what information do they need in order to make an intelligent decision? By focusing on your audience’s needs, it is much easier to clarify exactly what constitutes truthful communication. AOL not only withheld important and pertinent information. AOL mis-represented the information in order to suit their needs and their best interests at the time. When I say “their” needs, I am not referring to AOL and its backers, investors, employees, etc. I am referring to AOL’s senior executives, such as Steve Case.
It was due to the over-inflation of AOL’s stock, which was caused by exaggerated projections in the company’s future success. I feel AOL acted unethically, and without corporate social responsibility, but Time Warner failed as well in the area of corporate social responsibility. In my opinion, Time Warner, in essence, approached this mult-billion dollar merger as if it were a “crap shoot”, to which the senior executives merely said, “All in! ” and rolled the dice. Time Warner had a responsibility to investigate the company whom they were intending on investing money in which did not belong to any involved individually.
Although Time Warner’s actions may be construed to have been with the best of intentions, there really isn’t a “crystal ball” to foresee the future, however, there is no excuse for the negligence exercised in the lack of investigation to discover such discrepancies as the Justice Department and the Securities Exchange Commission found. This type of business deal is not one which should be left to senior executives to decide alone. This should have been a decision made by the executives, the investors, even maybe the employees.
Had a bit more foresight been used, maybe if the Time Warner senior executives had allowed for more input by the investors who had the most to lose, or if AOL hadn’t been given so much credibility with their promises of fortune and success, Maybe if there had been the social responsibility or business ethics factored into this “deal of a century”, then the well-being and best interests of all involved would have been of equal consideration and this disaster probably would have never made it off the “drawing board”.