Business Ethics (Case Analysis) Essay Example | Topics and Well Written Essays - 750 words

Business Ethics (Case Analysis) - Essay Example Brazil has been a place that Caterpillar has utilized to expand its operations and in 1993 the company consolidated its Brazilian operations in Piracicaba. Piracicaba was a town in dying need of industrial development in order to improve the supply of jobs available to the people. The region needed help and Catepillar became the perfect opportunity the people of Piracicaba needed. As Catepillar established itself in Piracicaba its arrival place it on the map as far as the town gaining international recognition. This indirectly helped the tourism industry and it eventually open the doors so that other companies began to move into Piracicaba. Caterpillar at first did not get too involved in the community. As the company starting building a networking within the community its level of involvement in social affairs at Piracicaba increase. Caterpillar since its arrival at Piracicaba improved the quality of life of the community by providing quality good paying jobs which helped many people in the region get out of poverty. Not only did the company pay a good salary, but the firm also provided many fringe benefits. The creation of a drug rehabilitation program to help employees with addiction is an example of the types of initiatives the company performed that goes beyond the norm. The employees are one of many stakeholder groups a company must considered when implementing corporate social responsibility strategies. Some of the other stakeholders that must be included within a CRS plan are the environment, suppliers, business partners, vendors, shareholders, lenders, and the community (Kotler, 2002). Despite the positive change that came once the company settled in the area many people the perception of many of the locals is that the company was simply not doing enough. Another thing was that the people felt that those Brazilians that gotten these good jobs were not grateful and were not doing anything to help the

Business Financing and the Capital Structure Essay - 6

Business Financing and the Capital Structure - Essay Example Raising finance through friends and family members is the least expensive way to access funds since it avoids high interest loans. Friends and family members are more patient than lenders, such as banks. The major disadvantage is that the owners must give out approximately 50% of their business to the outsiders. This puts the venture in danger of losing their business fully. Some of them may over expect the amount of profits. This brings misunderstandings because they expect more than can be afforded. Investments from family and friends require a good explanation about the impact of the venture. The financial arrangements should all be business-like. Formal business processes should be followed regardless of the relationship between the lender and the borrower. The details of the borrowed money should be outlined. This involves the means of payment, and what would happen in case the business does not prosper (Wolff, 2000). The borrower should not accept more money than the investor could afford to lose. It may render the company bankrupt. Finally, a written contract should be availed for the business owner, friends, and family. The business should treat the money as bridge financing to the next financing level (Boa and Edmans, 2007). Any payment schedule developed should suit the entrepreneur and the lender. An exit plan should be available describing how the investors will cash out the investments. Debt capital is loan obtained that must be returned with interest. Debt capital form of financing has higher interest rate than loans given to small companies since they have higher risks of return trade off than bigger corporate consumers do. The entrepreneurs maintain complete ownership of the business. Borrowed capital is a liability on the balance sheet. The major advantage of debt financing is that the lender cannot own the business. Those who lend capital only require interest on the loan given. Debt financing cost