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By the end of the case study discussion, it is expected that students will have learned to assess what makes it likely that firms will respond to episodes of stakeholder activism; establish the interplay between nonmarket strategies and corporate governance mechanisms in assessing shareholder activism; explain about the board of directors as a corporate governance mechanism; evaluate the threats of nonmarket dimensions as a strategic response from the board; and understand the impact and increasing power of shareholders over board decisions.

In April 2019, to pressure Rumo S.A. regarding the duplication of the Itirapina–Cubatão railroad, indigenous peoples from 12 São Paulo villages bought six Rumo shares, which were quoted on Tuesday, April 23, 2019, at around BRL17 each. Duplication of the railroad started in 2011 and affected the lives of the Indians. The company promised to implement more than 100 improvements to the villages, but as of 2019, half of the improvements were at a standstill. After buying enough shares to entitle them to participate in the annual general meeting (AGM) of shareholders, the Indians went to Rumo’s AGM to voice their concerns and show how the villages had been affected. It was the audit committee that needed to discuss and solve the case of the indigenous peoples. What steps would Rumo take next? What was the best thing to do with regard to the claims of the Indians? This case shows the start of corporate activism in Brazil. This case reports the dilemma that Rumo faced with the indigenous activism at the beginning of 2019 because of the expansion of their railroad network across indigenous lands.

This case is suited for a class in which the students are exposed to a corporate governance framework and internal and external governance mechanisms. The case can be applied at the graduate and executive levels in relevant courses such as corporate governance, corporate responsibility, strategic management, and the stock market.

Teaching notes are available for educators only.

CSS 11: Strategy.

The case “Corporate Governance Failure at Ricoh India: Rebuilding Lost Trust” discusses the series of events post disclosure of falsification of the accounts and violation of accounting principles, leading to a loss of INR 11.23bn for the company, eroding over 75 per cent of its market cap (Financial Express, 2016). The case provides an opportunity for students to understand the key components of corporate governance structure and consequences of poor corporate governance. The case highlights the responsibility of the board of directors, audit committee and external auditors and discusses the changes required in the corporate governance structure necessary to ensure that such incidents do not take place. The case also delves into the classic dilemma of degree of control that needs to be exercised by the parent over its subsidiaries and freedom of independence given to the subsidiary board, which is a constant challenge all multinationals face. Such a dilemma often leads to the challenge of creating appropriate corporate governance structures for numerous subsidiaries.

The case is intended for MBA courses on corporate governance, business ethics and also for the strategic management courses in the context of multinational corporations. The case can be used to develop an understanding of the essential of corporate governance with special focus on the role of the board of directors, audit committee and external auditors. The case highlights the consequences and cost of poor corporate governance. The case can also be used for highlighting governance challenges in the parent subsidiary relationship for multinational corporations. The case can be used for executive training purposes on corporate governance and leadership with special focus on business ethics.

This case presents the challenges faced by the newly appointed Chairman Noboru Akahane of Ricoh India. In July 2016, Ricoh India, the Indian arm of Japanese firm Ricoh, admitted that the company’s accounts had been falsified and accounting principles violated, leading to a loss of INR 11.23 bn for the financial year 2016. The minority shareholders were agitating against the board of directors of Ricoh India and were also holding the parent company responsible for not safeguarding their interest. Over a period of 18 months, Ricoh India had been in the eye of a storm that involved delayed reporting of financials, auditor red flags regarding accounting irregularities, a forensic audit, suspension of top officials and a police complaint lodged by Ricoh India against its own officials. Akahane needed to ensure continuity of Ricoh India’s business and also act quickly and decisively to manage the crisis and ensure that these incidents did not recur in the future.

The case provides an opportunity for students to understand the key components of corporate governance structure and consequences of poor corporate governance. More specifically, the case addresses the following objectives: provide an overview of corporate governance structure; highlight the role of board of directors, audit committee and external auditors; appreciate the rationale behind mandatory auditor rotation; appreciate the consequences of poor corporate structure; explore the interrelationship between sustainability reporting and transparency in financial disclosures of a corporation; understand management and governance of subsidiaries by multinational companies; and understand the response to a crisis situation.

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CSS 11: Strategy.

The impact of corporate governance on internal controls and quality of financial disclosures.

Analysis of a real financial fraud event for a non-US multinational corporation. The case relies on accessing and analyzing annual reports for the firm, both before and after the fraud. Additional information on industry governance characteristics are provided in the case itself so that students can compare the firm to the industry.

This business case is centered on the analysis of Schneider Electric, a French multinational corporation, which had to restate their financial statements in 2011 because of accounting fraud. Following this event, Schneider undertook major changes in their board structure to improve internal control mechanisms. This pedagogical business case familiarizes students with international differences in ownership and board structure and emphasizes potential corporate governance changes after financial statement fraud.

Managerial finance, corporate finance, international finance, auditing. This case is more appropriate for upper-level undergraduate and graduate courses.

The case would be specifically useful in courses related to Corporate Governance, Board Dynamics, Leadership, Organizational Behaviour, Corporate Ethics and Strategic Management.

For Post-graduate/Doctoral and Executive Programme/Management Development Programme level courses in Corporate Governance, Board Dynamics, Leadership, Organizational Behaviour, Corporate Ethics and relevant areas of Strategic Management.

The case relates to the imminent departure of Raamit Pell, the founding CEO of Xcelent Services, an educational service provider, to his parental organization at Kozerton after completing his current five-year term. Raamit had moved from Kozerton to become CEO of Xcelent Services. Many of Raamit’s senior executives at Xcelent were not happy about his decision to return. They felt that his departure at this moment might, on the one hand, slow down the ongoing major expansion plans and on the other aggravate a mutiny, under covert Board patronage involving a powerful clique of certain senior executives. The parental agency finally agreed to release him. On the day of Raamit’s farewell, where surprisingly even the clique members were present, many executives appeared sad. Observing the mood, Raamit wondered whether his decision to return to Kozerton was the right one.

To understand the internal governance, leadership and behavioural environment of a company. To understand the impact of internal power equations of a company on the morale of its people. To analyze both the inconsistency between the stated goals of the organization and the revealed actions of its top decision-makers; and the lack of restraint on the power struggle among the top actors of the organization. To identify effective strategies for addressing such issues in future so that their fallouts would be minimized. To relate the behaviour in an organization to the organizational behavioural theories related to leadership, corporate governance, corporate ethics, managerial behaviour and agency problems.

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CSS 11: Strategy.

Data for the case came from public sources, including legal proceedings, court filings, company press releases and Securities and Exchange Commission filings.

In June 2020, former Pinterest employees made public charges of gender and racial discrimination. Despite changes implemented by the company, several Pinterest shareholders filed derivative lawsuits charging the company with breach of fiduciary duty, waste of corporate assets, abuse of control and violating federal securities laws. The case provides an overview of the company’s management, board and stock structures, as well as information on the shareholders who sued the company and their concerns. The case raises substantial questions about management’s and board member’s responsibilities in corporate governance, illustrates how stock structures can be used to impede governance and suggests ways to evaluate activist shareholders.

This case is appropriate for graduate, advanced undergraduate or executive education courses in strategy, corporate governance or strategic human resources that discuss corporate governance, fiduciary responsibilities, designing workplace culture or management responses to shareholders. Instructors can apply two sets of theories and frameworks to this case: theories of corporate governance and Hirschman’s (1970) exit, voice or loyalty framework in the context of shareholder activism.

Family business.

Specialized undergraduate courses, Elective MBA courses.

This case study uncovers the remarkable story of the relentless growth and sporadic weakening of Nurul Ain (NA) Limited, a family business conglomerate with major operations in the Eastern region of Africa. The case provides an opportunity to follow the different stages of development of this family-owned organization through a sequence of strategic events and family dynamics that led to its recurrent success, decline and rejuvenation. Despite the numerous successes of NA Limited since its establishment in the early 1990s, the ambiguous relationship between family, ownership and management systems has caused a ripple effect of strategic, structural and governance challenges that threaten the sustainability of the family business. Nowadays, the founder faces the pressing challenge of ensuring his legacy remains intact and is passed over to his chosen successor, who, in turn, is confronted with the dilemma of joining the family business or pursing an independent career outside NA Limited. Shedding light on the complexity of today’s family-run organizations, the case allows examining the effectiveness of strategic decision-making in an emerging market context by applying a variety of family business principles, theories and frameworks.

Discuss the sources of competitive advantage and the typical challenges that family firms face in the context of emerging markets. Perform a comprehensive corporate diagnosis and examine the specificities of strategic management process in family businesses. Assess the succession management practices in family-run organizations and design a profile of successful successor. Discuss the effectiveness of various corporate governance mechanisms in the context of family-owned enterprises. Evaluate the strategic choices of the top management team and offer recommendations for securing the family business longevity.

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CSS 11: Strategy.

The learning outcomes are as follows: to use advanced frameworks and tools to convey complex ideas related to strategy and sustainable business practices; apply relevant concepts and theories of corporate social responsibility and governance to a practical situation while making decisions; demonstrate understanding of the importance of stakeholders when developing socially responsible thinking; and analyze the different strengths and weaknesses of the organization when making a decision that would affect the company strategy.

Claire Humphry was the General Manager at the renowned The Nacre Hotel in Penang, Malaysia. Claire had a very busy job as she had many people who reported to her, and the hotel was always full of guests. One of the things Claire also managed was the restaurant OceanSound that was owned and operated by her hotel. OceanSound was a very thematic restaurant that specialized in making sculptures of food for special events. On the New Year’s Day in 2023, Claire came to work ready to tackle what was sure to be a long and busy day. However, Claire had not anticipated exactly how taxing the day would end up being. During Claire’s talks with her colleagues throughout the day, her conversation with her friend, the head chef of OceanSound, Poh, would nag at her head for the rest of the day based on the events that followed. The New Year’s special sculpture at OceanSound was to be a large rabbit made of cake to commemorate 2023 being the year of the rabbit according to Chinese zodiac. This is usually kept secret until the sculpture is revealed; but somehow this information had been leaked. This led to The Nacre Hotel and OceanSound being in the spotlight for bad reasons as this sparked a debate online regarding food wastage. This escalated quickly and even led to a famous food influencer commenting on this using specifically The Nacre’s name. Activists also quickly emerged in front of the hotel to protest the creation of sculptures and the food wastage in Malaysian hospitality industry, seeking to make an example out of The Nacre Hotel. The online criticism died down and was eventually replaced by praise for the sculpture. The activists were also eventually asked by the hotel security to leave, which led to the rest of the day to go as expected for a New Year’s Day at The Nacre. However, Claire’s nagging suspicion that they were not out of the woods led her to start looking into food wastage in the hospitality industry in Malaysia to educate herself and bring it up in a future meeting. Two days after this incident, on January 3, 2023, Claire found The Nacre Hotel posted on the newspaper headlines, dissecting the food wastage associated with the hotel now. After getting an urgent phone call from the Regional Manager, who was pressured by the board and shareholders, Claire decided the time to address this issue could not be delayed any longer. She wrote an email to her strategy team to come up with some ideas for possible solutions to the issue and to present them in a group meeting within a week’s time. At the conclusion of the meeting, Claire was contemplating about the decision that she had to make if she wanted The Nacre Hotel to continue operating successfully in Malaysia’s hospitality industry.

The main theoretical concepts illustrated in the case include corporate governance approaches, types of corporate social responsibility, stakeholders’ prioritization, organizational culture, organizational structure, industry analysis and strategic choices. Therefore, this case study can be used in a upper-level undergraduate business courses in the field of Strategic Management and Corporate Social Responsibility. The case study can be successfully used in a capstone course on Business Policy and Strategy, when tackling the concepts of corporate social responsibility, environmental sustainability strategy and corporate governance. Under this scenario, the usage of conceptual frameworks from Chapters 2 and 3 of the textbook titled “Concepts in Strategic Management and Business Policy: Toward Global Sustainability” by Wheelen and Hunger would be required. This case study can also be successfully applied to MBA level courses on Strategic Management in a Globalized World. In this case, the latest edition of the textbook titled “Exploring Strategy” by Whittington et al., could be used (particularly, the material from Chapters 2–9, 11, 14 and 15). Additionally, the case could also be used in courses related to Tourism and Hospitality, especially in schools which have specialized programs in this field.

Teaching notes are available for educators only.

CCS 12: Tourism and Hospitality.

Corporate governance, privatisation.

Masters level programmes, with particular focus on corporate governance, privatisation, and organizational development.

Yutong Bus is a real and highly publicized case in China. It is a listed company carved out from a state-owned enterprise (SOE), Yutong Group. Later the management successfully bought out Yutong Group and thus indirectly controlled the company. The deal transformed Yutong Group from a SOE to a private company. The management was innovative in pushing through the management buy-out (MBO), but politically, it created a public outcry about the loss of state-owned assets. The key issue here is the selection of state owned enterprises suitable for privatization and, more importantly, the determination of selling price. In China “the market for corporate control is still lagging behind” (Shanghai Stock Exchange).

Students would be expected to gain an understanding of recent economic reform in China, Corporate Governance in the Chinese context and wider issues associated with privatization and MBOs.

Teaching note.

After completion of the case study, the students would be able to comprehend the crisis at hand for Milkbasket, why did it resist Reliance’s takeover in the first place, then to evaluate the pros-cons and future prospects for the organization post-acquisition; to evaluate from an ethical standpoint the process of mergers and acquisitions using ethical frameworks to understand how, when, to whom and through what processes do mergers and acquisitions qualify the test of being ethical; and to analyse different hostile takeovers, especially through tender offers, proxy contests and toehold bidding strategy in this case.

Founded in 2015, Milkbasket was a micro-delivery start-up based in Gurugram (near New Delhi), India. Milkbasket would let its subscribers order till midnight and deliver groceries, milk and other everyday essentials to its subscribers before 7 a.m. next day. It had burnt a lot of cash and was facing difficulty in getting investors; as such they were engaged in discussions with many companies. Two of them – Reliance Retail Venture Limited and BigBasket – were not accepting the proposed valuation, but Milkbasket got term sheets from other two companies.

This case study can be used for graduate courses on strategic management, business ethics and corporate governance. This case study can also be used in corporate finance course to highlight the importance of making ethical/responsible judgements to protect stakeholder interests.

Teaching notes are available for educators only.

CSS 3: Entrepreneurship.

As China has pressed ahead with rural revitalization in recent years, its rural financial sector has also developed rapidly and the financial environment has been greatly improved. But compared with urban areas, the rural financial sector makes rather limited contributions to rural economic development for a variety of reasons, including single types of service providers, narrow coverage, and lack of services and products. The underdevelopment of the rural financial system is closely related to the characteristics of its target customers and the economic system. The deficient rural financial credit system, the low level of IT application, the difficulty in data collection and integration, and the insufficient collateral of farmers pose high costs and huge risks for financial institutions when providing credit and other financial services.

In the present case, fintech and financial innovation complement each other: The application of fintech makes innovation possible, and the need for financial development fuels the development of fintech. Leveraging fintech and new business models, MYbank has overcome the main obstacles in the development of rural finance to provide convenient financial services for farmers and rural MSEs. Fintech is the abbreviation of “financial technology.” It can be understood as the combination of finance and technology for easier understanding, but it is more than that. Fintech refers to the innovation of traditional financial products and services with various technologies to improve efficiency and reduce operating costs. The emergence and development of fintech have led to the creation of new business models, applications, and processes, which have triggered major changes in financial markets, financial institutions, and the ways financial services are delivered, and are reshaping the financial landscapes of countries and even the world.

There are three major problems in the development of rural finance: difficult access to data, difficult risk management, and difficult market penetration. In order to gradually remove the obstacles and guarantee sustainable business development, MYbank has created three new business models with the power of fintech: digital inclusive finance at the county level, industrial finance, and platform finance. With these models, MYbank is searching for a “Chinese solution” to the worldwide problem of rural inclusive finance.