Corporate Ethics Essay

Corporate Ethics Essay

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The board of directors is also highly influential to a corporation and should therefore also be held accountable for supporting a corporation’s ethical code of conduct. The board of directors is responsible for looking out for the best interests of shareholders (Cross & Miller, 2012). The board of directors was designed to monitor executives, however in practice this is not always the case (Cross & Miller). Obviously this is monitoring is a necessary duty. A proposed change to ensure that the board of directors is monitoring the corporation’s top executives is to require that the board submit quarterly a report on the financial information of the corporation as provided to the board by the CEO and CFO. If this information does not match what is reported to the SEC directly, action should be taken to reprimand the officers. Board members are elected officials, because of this fact board members should be selective in the companies that they are willing to serve on. Board members should agree to serve on boards of companies that have a good ethical rating.
The board of directors should also be willing and able to observe and report instances of fraud and potential conflicts of interest. Fraud and conflicts of interest are both issues that played a key part in the demise of Enron and other large corporations. Enron and Arthur Anderson had a relationship that should never have been allowed to occur. Anderson was both the accounting firm, auditing firm, and consultant firm for Enron (PBS, 2002). This was a major conflict of interest. This conflict of interest made it very easy for executives to coerce employees to try to hide the fraudulent accounting. Auditing firms who make a living off of auditing and consulting fees may...


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...ent of business. (8th ed.). Mason, OH: Cengage Learning.
Ethisphere. (2011). 2011 world’s most ethical companies. Retrieved from, http://ethisphere.com/wme2011/
Ferrell, O., Fraedrich, J., & Ferrell, L. (2011). Business ethics (8th ed.). Mason, OH: Cengage.
Gomstyn, A. (2010). Walmart CEO pay: More in an hour than workers get all year? Retrieved from, http://abcnews.go.com/Business/walmart-ceo-pay-hour-workers-year/story?id=11067470
Indiacsr. (2010). Concept of corporate social responsibility. Retrieved from, http://www.indiacsr.in/en/?p=113
PBS. (2002). Who dropped the ball? Retrieved from, http://www.pbs.org/wgbh/pages/frontline/shows/regulation/watchdogs/
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Corporate Ethics Essay

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