Despite the consensus that climate change will have huge consequences not just for the planet but also on corporate operations, businesses continue to fail to adjust their strategic decision-making processes to become more sustainable. One of the silent culprits behind climate change inertia lies in the cognitive biases at play in corporate decision making. This article builds on existing strategic decision-making models to explain how biases prevent managers from accurately identifying the moral dimensions of climate change. It also presents a broad range of practical interventions for how this constraint can be overcome.
Julien Levy, the case protagonist, is product manager at SOTARG France in charge of printers and related accessories. SOTARG is an international manufacturer of printers, print-related products and other electronic devices. He has been approached by a direct marketing firm offering its services in developing and implementing a sales promotion campaign to help boost SOTARG's end-of-year sales. The suggestion is to launch an in-store promotional campaign in 10 hypermarkets at a certain price per day per booth. Julien is interested, but has to evaluate how many new customers the campaign must generate in order to break even on the cost of the promotion or even be financially more interesting.
"In November 2006, 200 German policemen and prosecutors raided 30 offices and homes of Siemens managers to investigate allegations of embezzlement at Siemens' fixed-line phone unit. In the wake of internal investigations started at the end of 2006, Siemens finally admitted to having identified dubious payments amounting to €1.3 billion from the years 1999 to 2006. As a result, Siemens replaced all but one of its managing board members. At the end of July 2008, a former sales manager at Siemens' telecoms division, was convicted for his role in setting up the slush funds used to win contracts. The same day, the supervisory board approved the recommendations a well-known law firm to sue almost all executive committee members in charge between 2003 and 2006. Learning objectives: To introduce students to the issues surrounding corruption in international business."