Paper#1 Theranos

A fascinating element of this case is the fact that so few people involved with Theranos asked the basic question of whether or not the technology worked and many employees who knew the technology did not work did not come forward. Many people with the duty to ask questions did not. For example, a board of directors should exercise “due diligence,” which assures that the company’s financial picture is sound and that the company’s actions do not harm others. The Theranos board seemed uninterested in either function. Theranos board member George Shultz testified under oath that, despite escalating allegations, he believed Holmes’s claims about her technology and it did not occur to him to probe into it. Similarly, very few investors asked basic scientific questions and many employees were too afraid of losing their jobs to come forward. These failures could be argued to have resulted in direct harm to patients who were relying on the faulty tests for medical decisions. Considering that Holmes and Balwani are the only ones charged by the SEC and the only ones facing criminal charges, what, if any, moral responsibility should be placed on the board of directors, investors, and employees? In other words, did they have a moral responsibility to make sure that patients of the blood test were not harmed? Should those that enabled Holmes to continue to lie also be held accountable for their actions? Why or why not? Be sure to include moral argumentation to support your position.

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