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The importance of ethics in a business
The importance of ethics in a business
Can profitability and morality co-exist in business
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With recent economic turmoil, ethical business practices have been thrown into the spotlight as a vital area with which companies need to improve on. Proper business ethics are vital for economic growth and progress as well as facilitating a productive and morally correct society. The United States has recently suffered large economic declines, the most significant of which occurred in 2001 and 2008. As the questions are asked and some answers given, the picture of big business not caring about the middle class individual is painted for the American people. Everyone has a finger to point, and many of these are aimed towards these large companies. With the blame falling on various financial institutions, people begin to dig deeper to try to understand the source of the problem. Questions are asked such as, how did this happen? How do we prevent this from happening again? Who is to blame? How do we recover? It is my belief that if you trace the issues arising amongst these corporations back to its finest root, you will find many ethically questionable individuals. It is my goal to begin to understand how these poor decisions have affected every single person in our great nation, and how a set of proper morals and correct ethical decisions can yield a flourishing economy.
When we look back on our recent decline and try to find a failed business to dissect, we find that we have a host of examples to choose from. In most cases, the failures of large businesses often are a product of similarly incorrect moral decisions. It goes without saying that the motivation for these lapses in judgment is money based. Going deeper into this we run into the question; How far would you go for a financial return? One big issue in today’s b...
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It's difficult not to be cynical about how “big business” treats the subject of ethics in today's world. In many corporations, where the only important value is the bottom line, most executives merely give lip service to living and operating their corporations ethically.
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Many organizations have been destroyed or heavily damaged financially and took a hit in terms of reputation, for example, Enron. The word Ethics is derived from a Greek word called Ethos, meaning “The character or values particular to a specific person, people, culture or movement” (The American Heritage Dictionary, 2007, p. 295). Ethics has always played and will continue to play a huge role within the corporate world. Ethics is one of the important topics that are debated at lengths without reaching a conclusion, since there isn’t a right or wrong answer. It’s basically depends on how each individual perceives a particular situation. Over the past few years we have seen very poor unethical business practices by companies like Enron, which has affected many stakeholders. Poor unethical practices affect the society in many ways; employees lose their job, investors lose their money, and the country’s economy gets affected. This leads to people start losing confidence in the economy and the organizations that are being run by the so-called “educated” top executives that had one goal in their minds, personal gain. When Enron entered the scene in the mid-1980s, it was little more than a stodgy energy distribution system. Ten years later, it was a multi-billion dollar corporation, considered the poster child of the “new economy” for its willingness to use technology and the Internet in managing energy. Fifteen years later, the company is filing for bankruptcy on the heels of a massive financial collapse, likely the largest in corporate America’s history. As this paper is being written, the scope of Enron collapse is still being researched, poked and prodded. It will take years to determine what, exactly; the impact of the demise of this energy giant will be both on the industry and the
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Recall the tale of an impoverished man who steals a loaf of bread to feed his starving family. In the instance when two moral obligations collide, the only way to comply with one is to violate the other. No matter which course is chosen, the other must be ignored.”(Freeman, Engels & Altekruse 2004) Stealing and breaking the law challenges the philosophy of breaking the responsibility of caring for one’s family. Accountants need to think clearly, challenge the possibilities, understand the options, and acknowledge the consequences. The choice to steal bread will vary from one person to another, but as Christians, dying of hunger is more of a reward than a consequence. Accountants can learn from examples of people and companies who have been faced with pressing ethical dilemmas. Accountants can learn from Bernard Madoff and his $61 billion ponzi scheme that ruined thousands of people’s life savings (Freshman 2012), or Enron “circumventing the rules, temporarily changing or suspending the rules, and outright thievery to achieve his objectives” (Gini 2004). Knowledge about the past will lead people to make wise ethical decisions. The world can clearly see the consequences that these people and firms have undergone and do not want to follow in that path. There are responsible businesses, like Frito-Lays who have a major go green campaign. They have a better business by reducing their natural
The movie “Glengarry Glen Ross” presented a series of ethical dilemmas that surround a group of salesmen working for a real estate company. The value of business ethics was clearly undermined and ignored in the movie as the salesmen find alternatives to keep their jobs. The movie is very effective in illustrating how unethical business practices can easily exist in the business world. Most of the time, unethical business practices remain strong in the business world because of the culture that exists within companies. In this film, the sudden demands from management forced employees to become irrational and commit unethical business practices. In fear of losing their jobs, employees were pressured to increase sales despite possible ethical ramifications. From the film, it is right to conclude that a business transaction should only be executed after all legal and ethical ramifications have been considered; and also if it will be determined legal and ethical to society.
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Shaw, W. H., & Barry, V. (2011). Moral Issues in Business (Eleventh ed., pp. 230-244).