Reference no: EM131576059

On September 16, 2008, AIG (American Insurance Group), received an $85 billion bailout package from the US Federal Reserve in order to meet its financial obligations and maintain liquidity. The support package was increased to a potential $182.5 billion by May 2009. After the first bailout plan, it was discovered that AIG spent $444,000 on a retreat for employees and distributors, $86,000 on an executive hunting trip, and $343,000 on a corporate event in Arizona. In March 2009, AIG announced that it would pay $165 million in bonuses, in spite of its historic losses and dependence on government intervention. All of this was legal, of course, but roundly criticized as an unethical use of taxpayers’ dollars. What was the ethical strategy that AIG took with respect to company expenditures and the payment of bonuses? In your opinion, what strategy should they have taken? Can you think of a way in which AIG could have paid the bonuses while also maintaining a positive ethical reputation? Would you have approved the spending and bonuses? Why or why not?