For countries such as United States of America and France, ethics codes must be stronger and well known by financial community and citizens with keeping balance between shareholders’ interests among other interests of stakeholders. The situation in United states is different than France; American executives and shareholders are enjoying high profits and incentives even employees’ cutting percentage is high turning that to Anglo-Saxon and adopting shareholder theory. In France, unemployment percentage is high and companies achieve low profits turning to an important fact that executives cannot make decisions can serve shareholders’ interests and their personal interests since other groups of stakeholders is strong and can block their decisions. Ethics codes is an important mechanism of corporate governance, which comes from communities without need for enforcement. That opens the door for ethics programs to go in different levels in business world and for normal citizens to assure social and environment responsibilities of companies. Plus, executives and shareholders should think about corporate governance as a key of corporate sustainability in the light of their companies responsibilities. Taking Corporate governance model of United Kingdom is considered as a successful model nowadays since it successes to attract foreign investors, but that could not be without a strong and serious decision of politicians to adopt several changes in regulations and company law. Thus, politicians and socialists have their role in affective corporate governance, governance principles can be issued and published, but it cannot be applied since the atmosphere is not well prepared, countries such as Romania and Russia have their own models beside ado...
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... on two questionnaires, the first one is done during last year, but another questionnaire is more concerned regarding several issues which is connected to a religious fundamental reformulated to match with current issues we may face. The samples are selected from academic institutions in Romania, Republic of Moldova, Syria, India, Russia, Spain, China and United Kingdom. The problems which I faced is written down beside limitations of the questionnaire. The problems can be returned to technical matter because the emails received as spam not as a regular email which pushes potential participants to ignore the questionnaire, after analyzing the results I found out that some questions are needed to prove my objectives and the period of doing this questionnaire is not desirable for participants (Easter vacation, conferences, and tests). The results are not ready yet.
According to Mallor, Barnes, Bowers, & Langvardt (2010) “modern corporation law emerged only in the last 200 years, ancestors of the modern corporation existed in the times of Hammurabi, ancient Greece, and the Roman Empire. As early as 1248 in France, privileges of incorporation were given to mercantile ventures to encourage investment for the benefit of society. In England, the corporate form was used extensively before the 16th century. In the late 18th century, general incorporation statutes emerged in the United States” (p. 1009).
The concept of business ethics refers to a set of guiding principles that encourage individuals in an organization to make decisions based on the company’s stated beliefs and attitudes toward business practices within its industry (Lisa McQuerrey., 2016). Ethical and Unethical business decisions have long been a predicament encountered by organisations, these practices are concerned with how the companies interact with the global business world, and to their one-on-one dealings with individuals (Garry Crystal, 2016.) The concept of ethics and social responsibility emerged into the business world in the early 1970s after the end of World War I, saw these organisations become more profit driven resulting in negative impacts on society at large.
For a company to be successful ethically, it must go beyond the notion of simple legal compliance and adopt a values-based organizational culture. A corporate code of ethics can be a very valuable and integral part of a company’s culture but I believe that it is not strong enough to stand alone. Thought and care must go into constructing the code of ethics and the implementation of it. Companies need to infuse ethics and integrity throughout their corporate culture as well as into their definition of success. To be successfully ethical, companies must go beyond the notion of simple legal compliance and adopt a values-based organizational culture.
Business ethics simply can be defined as the application of business values in the business practice of a company (Seawell 2010, p. 2). For a multinational company, business ethics is one of the critical aspects need to be taken into account in business decision-making processes. Failure to give attention on ethics may bring consequences on company’s reputation (Meyer & Jebe 2010, p. 159). The company is expected not only to pursue its own profits but also contributing to the environmental and social welfare of the community where it operates (Svensson & Wood 2008, p. 308).
An organization needs to adhere to ethics in order to effectively implement its mission, vision, and objectives in a way in which offers a solid foundation to management and their subordinates to properly develop and implement its strategies. By doing so, the organization as a whole is essentially subscribing to one commonality that directs all of the actions of the employees of the organization. Additionally, it assists in preventing such employees from divergence in regard to the proposed strategic guideline. Ethics additionally ensures that a strategic plan is developed in accordance to the interests of the appropriate stakeholders of the organization, both internal and external (Jin & Drozdenko, 2010). Likewise, corporate governance that stems from various regulatory parties makes it necessary for organizations to maintain a high degree of ethical standards; this is done by incorporating ethics within the organization’s strategic plan so as to foster a positive corporate image for the stakeholders and general public (Min-Dong Paul, 2009).
The principles method which is used in countries around the world is also known as the comply-or-explain approach. The government of each firm’s country creates the corporate governance policies that are followed. These procedures are required to either be followed or the company must present the governing body with just cause on why they are not in compliance. This method has several benefits, one being its ability to apply to almost all firms; it is up to the management to apply these governance principles. There are several detriments to each method used today, one severe downside the Comply-or-Explain approach is that disciplinary action is not taken when a firm does not comply and fails because of that non-compliance. This was witnessed in the economic downturn in 2002, firms that were not in compliance experienced harsh economic conditions than those that did not.
There are many different industries in today’s corporate world. Perhaps, the most vital component in the corporate structure is its Codes of Ethics. Business Ethic or can be known as the Code of Ethics is a form of codes within the corporate world which it uses the Ethics and applies it to the entire philosophies of this corporate structure. In today’s day and age, most corporate structures use the Code of Ethics applies to the social atmosphere rather than the financial side.
In addition to CSR and company performance, corporate governance mechanisms are key variables which might affect the relationship between CSR and company performance. Corporate governance is defined from a broad perspective by Gillan & Starks (2003) as “the system of laws, rules, and factors that control operations at a company” (p. 2). Corporate governance mechanisms within a company protects shareholder interests and reduces the frequently occurred agency problem (Stuebs & Sun, 2015; Bushee, Carter & Gerakos, 2014). Due to the implementation of corporate governance mechanisms, shareholders have a greater control over the managerial decisions and actions, which prevents the agency conflict and creates trust
The Corporate Governance is a multi-faceted subject. An important theme of corporate governance deals with issues of accountability and fiduciary duty, essentially advocating the implementation of guidelines and mechanisms to ensure good behavior and protect shareholders. Another key focus is the economic efficiency view; through which the corporate governance system should aim in optimize economic results, with a strong emphasis on shareholder welfare. There are yet other sides to the corporate governance subjects, such as the stakeholder view, which calls for more attention and accountability to players other than the shareholders. (Example: The employees or the Environment)
It concerns with the discipline of an individual as well as the society. The origins of the words ethics are from Aristotle where he stated that, ethics was more than a moral as well as legal or religious concept. In legal perspective, legislation of ethical behavior has their ancient roots. For example, the Code of Hammurabi is one of the earliest law codes developed during the eighteenth century. This code has made Bribery as a crime in Babylon back then. The system of law in our life today is closely related to ethics where the law is used to enforce definite rights and duties. As ethics is one of the most important things, most of the company in Malaysia have implement and listed down the code of ethics of their directors. Moreover, Code of Ethics for Company Directors also has been listed down in the portal of Suruhanjaya Syarikat Malaysia. This is because; a position of trust with the public, stakeholders, officers and the employees of the corporation is hold by the director. So that, an appropriate standard of conduct as well as the ethical behavior is the most important things for the sake of a corporation reputation. As a conclusion, the Code of Business Conduct and Ethics for Directors is established in order to reflect the Board’s commitment to such
In the business world there are many fundamental aspects and situations that can lead to several issues. In order to find an optimal and professional solution, business decision makers need to apply moral and ethical standards. And it is at that moment in which business ethics perform its role. Business ethics, which is in charge of examine how companies and individuals should act in business situations, is very essential in order to reach a common agreement and to work within the laws of business and solve an arisen dilemma. Working of the hand of ethical business companies, employees, investors, directors, and even individual officers can be beneficiated and obtain most favorable outcomes.
As a result of modern corporate scandals and rapid development of international business environments, social responsibility (SR) has become a key aspect of corporate competitive contexts. (Brammer, Williams and Zinkin, 2007). Businesses are under increasing pressure to incorporate SR amongst their profit-driven aims and have become increasingly accountable for their social and environmental actions. Increased interest in CSR developed in the mid 1990s as consumers began to lack their former trust in companies due to both environmental and financial scandals and it became noticeable that society was moving towards values incorporating harmony, quality of life and environmental conservation (Carrasco, 2007) Additionally, major corporate failures over the past two decades have resulted in increased demand for stronger, corporate governance (CG) rules. (Sui, Wright & Evans, 2007). Superior CG rules are needed in order to preserve the integrity of corporations, financial institutions and markets and the health and stability of world economies. (OECD Website)
According to Carol Padgett (2012, 1), “companies are important part of our daily lives…in today’s economy, we are bound together through a myriad of relationships with companies”. The board of directors remain the highest echelon of management in any company. It is the “group of executive and non-executive directors which forms corporate strategy and is responsible for monitoring performance on the behalf of shareholders” (Padgett, 2012:1). Boards are clearly critical to the operation of companies and they are endowed with substantial power in the statute (Companies Act, 2014). The board is responsible for directing and steering the company. The board accomplishes this by business planning and risk management through proper corporate governance.
Business Ethics are much more than the buzz word stories on late night news. The Corporate Social Responsibility of a company goes well beyond that. “Business Ethics are moral guidelines for the conduct of business based on notions of what is right, wrong and fair.” (Bellow, 2012). Individual backgrounds play a huge role in person by person code of conduct can vary from employee to employer. To help solve some grey areas in what is ethically correct, companies now make a code of conduct that is over everyone in the company. This code of responsibility helps employees have better understanding of what is required of each and every one of them. “Corporate Social Responsibility is a business philosophy which stresses the need for
Corporate governance is the policies, rules and regulations, by which a corporation shapes the way corporate officers, managers, and stakeholders perform their duties to create wealth for the entity. According to Lipman (2006), good corporate governance helps to prevent corporate scandals, fraud, and potential civil and criminal liability of the organization (p. 3). Most companies, whether formal or informal, have some type of corporate governance for the management to follow. Large companies will have a formal set of rules and regulations, while small companies frequently have spoken rules often due to lack time to form any type of formal policies. There is often no corporate governance with family owned companies.