Wall Street Simulation
Finance and ethics - is it even possible to put them in the same sentence or is “wall street ethics” too big of an oxymoron? According to a study in May, 2015, almost “half of those surveyed said it was likely their competitors engaged in illegal or unethical behavior to gain a business edge, and close to 20 percent felt it was sometimes necessary for people in their profession to engage in illegal or unethical activities "to succeed.”
This activity allows the youth to experience the dynamics of Wall Street and to play different roles that make them reflect on the motives and methods of transnational corporations and the way they function.
Multi-agent role game
To reflect on the priorities of capitalist companies when they make decisions
To reflect on how interpersonal conflicts and animosities can influence companies’ decisions that affect thousands of people
To develop a critical thinking regarding how the global economic system works
Required Materials and Tools:
Printed role descriptions for each participant
Printed handouts of problems and solutions (one set per each "company").
The facilitator of the game declares his/her role as the “Wall Street” and divides participants into different groups (max 8) of so-called "companies". Groups are sitting at some distance from one another, so that they don't overhear other companies' discussions; each company has 4 participants.
The facilitator gives each participant of the company one of the roles (President, Councilor 1, Councilor 2 and Councilor 3), which must be kept secret and are not revealed to anybody, neither in nor outside the "company". (See the list of roles under “attached support files” below).
The person who got the role of “the President” of the company introduces herself/himself to the other members of a group and the game starts. Each company has one president. "Companies" decide on their names and inform the "Wall Street" (the game facilitator);
“Problems” are handed out to the "companies" by the “Wall Street” (see list of problems under “Problems” below). "Companies" discuss and vote to choose one of four possible solutions (in case of a tie the president's opinion prevails). Then they let the "Wall Street" (facilitator) know what the preferred solution is.
A Discussion takes place among all participants. The discussion is facilitated by the Wall Street (facilitator) who uses the questions provided under “Reflection” below.
NOTE 1: Facilitator can either propose to the group one specific decision-making process or can help the group choose a decision-making method, refer to The Town Hall and the Community Centre module.
NOTE 2: Time is of the essence! The facilitator can set up a time limit for solving each problem (i.e. 10 min). If you want to, you can run a second round of problems.
Attached Support Files
LIST OF ROLES
WALL STREET (FACILITATOR)
As the “Wall Street”, you are the person who is facilitating the game. You divide the participants into different groups (companies) and hand out the different roles to each participant. You also hand out the different problems and solutions to the group so that the group (company) decides on a single solution for the given problem.
As the president of the multinational company you never have a clear opinion on the solution of the problem and always prefer to listen to others' reasons before saying your own. One minute before the meeting starts, a close collaborator tells you that one member of the board is a spy of a competing company. You don’t know who she/he might be, but you know she/he will often mention social issues. You obviously have to pay attention to the spy's suggestions because she/he will try to make your enterprise collapse.
As councilor 1, you are a spy of a competing multinational company. Your task is to convince the other members of the board of directors to take decisions contrary to the ones you believe are right to make the enterprise succeed.
As a councilor 2, you just got in on the board of directors of this multinational company and you want to establish good relationship with the president. You will try to convince the president of your opinion but never contradicting her/him and always flattering her/him. Still, you want your reasons to prevail because you know the president likes firm people. A close friend told you the president seems to be sensitive to social problems, so you have to include in your speeches social issues such as "President, think of the social repercussions" or "President, what will the society say?"
As a councilor 3, it's been ten years since you have been a member of the board of directors and you find yourself on strained terms with the president. In a month, there will be the elections of the new president and you do not want to fail in getting that role as was the case four years ago. You will do anything to discredit the president and to make your decisions be approved especially if contradicting the president's. By discrediting her/him, you will always insist on her/his irresolution and on her/his inability to come to a quick decision. You will oppose while the other councillors will always agree with her/him.
HANDOUT WITH PROBLEMS
The production costs of your factory in Haiti rose by 10% because of the increase in salaries and of the adjustments to laws which regulate workers safety at work. Digifoot, a competing company, has just opened a factory in China where salaries are lower and trade unions are weaker. In this way, their shoes cost 15% less than yours.
WHAT DO YOU DO?
You open a factory in China and keep the one in Haiti for at least one year;
You begin an advertising campaign on work conditions in Chinese factories in order to undermine the Digifoot competition;
You close the Haiti factory and you open one in China;
You begin an advertising campaign of your shoes emphasising that buying these shoes will help the poor people in Haiti that work for you.
Your factory in Texas is losing 15% annually and your experts suggest that you should sell it.
WHAT DO YOU DO?
You fire 1000 out of 3000 workers to control the costs;
You invest in a training course for your workers and you begin to make hand-made high quality shoes which will cost $600 a pair;
You provide income support for the 3000 workers while waiting to find a buyer for the factory;
You fire 2500 workers and you use the rest for administrative jobs.
800 workers who used to be employed in one of your factories in Mexico sued you for damages claiming that you were using a solvent glue which caused their permanent sterility.
WHAT DO YOU DO?
Before the trial starts, you immediately compensate them with $15.000. To promote your action you buy a page in the Times;
You buy the jury with $100.000 to make sure you do not have to pay any compensation;
You wait for the trial;
You pay some of the best lawyers in New York to defend you so as to make sure that you will be discharged (it will cost you $10.000.000).
Greenpeace has discovered that you use an element that causes cancer to produce one model of your shoes. For this reason, Greenpeace activists chained themselves to the gates of your central office in London.
WHAT DO YOU DO?
You ignore the protest and deny the use of the cancerous element;
You call a meeting with the delegation from Greenpeace;
You stop using the cancerous element while waiting for scientific results (you have to close the factory losing 50.000$ a day);
You kick the activists out.
Activists are distributing pamphlets in front of your Italian shops (around 140) denouncing the dreadful working conditions in your Indian factories. The shop director in Pinerolo sued the ones distributing pamphlets in front of his shop.
WHAT DO YOU DO?
You deny any responsibility of what is going on in India, but you do not take part in the trial;
You establish an inquiry of commission into your Indian factories;
You support the director and start the trial against the activists to defend your image (it will cost you about 800.000$);
You ignore the matter and you do not support the director’s action.
You bought 70% of Benzinai, a Nigerian petroleum company. Many of its oil-wells are located in the middle of the Nigerian virgin rainforest.
WHAT DO YOU DO?
You extract oil but you make sure that every precaution is taken to avoid pollution (this costs you 20% more);
You extract at a lower cost;
You decide not to extract oil from the virgin forest to avoid pollution;
You keep extracting oil and you launch a new kind of petrol: "Pine-petrol", a new petrol that smells of pine which you hope will appease ecologically conscious customers;
Amnesty International accuses a Vietnamese factory which produces laces for your shoes: bad salaries, corporal punishments, prohibition of using the bathroom more than once a day.
WHAT DO YOU DO?
You give $100.000 to Amnesty International;
You establish an ethical code of behaviour which pledges to engage just companies that recognise dignity to workers. But you reject any kind of supervision;
You deny Amnesty's report;
You close your relationship with the factories;
You have the possibility to contract the most famous football player Bobaldo for an advertising campaign ($20.000.000).
WHAT DO YOU DO?
You prefer a cheaper contract with the Brazilian volleyball national team ($10.000.000);
You accept it and you launch a big advertising campaign on television and magazines with Bobaldo;
You refuse it and start a new advertising campaign by doubling the salaries of your 80.000 Asian workers (it costs $20.000.000);
You hire not only Bobaldo but also his entire team. You launch a huge campaign ($50.000.000).
NOTE: other problems, more related to the module topics can be created and distributed for the role playing game.
How was it to act out your role?
How did the group act? Did everybody participate equally? Did you perceive any tension?
What were the most significant problems your "companies" were struggling with?
Were your "companies" eager to sacrifice profits for the good of environment, people's health, safety, rights?
What was the impact of interpersonal relations within the "companies" on the decisions that you took?
Do you think this game reflects reality?
How can we make corporations become more responsible?
Instructions for Submission
Submit a word piece (up to 200 words) on your experience from doing this activity. Base it on the questions in the Reflection section. Instructions on how to upload photos and how to submit things in Moodle can be found here: Instructions on Submission&Uploading
Instructions for AssessmentProvide feedback to at least one participant that has done this activity. Instructions on providing feedback can be found here: Instructions on Feedback
Macroeconomics and globalization
Ethical and social entrepreneurship
Decision making and conflict resolution
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