Volkswagen : The Outrageous Corporate Scandal Of 2015

The author Robert Solomon argues that ethics has to an integral part with regard to business management. He does not believe that business management must include unethical or illegal methods to be able to succeed. Solomon preaches that business management is not as simple as obtaining revenue. “Businesses need to abide by fair policies and their owners have to be ethical in dealing with their customers” (Shaw p. 37). The author acknowledges that while illegal practices in business management could bring positive results at first, eventually the business is bound to fail. This is why Solomon recommended eight important policies that can help businesses in integrating ethics into their operations.

The unethical behavior portrayed by Enron’s senior management was ultimately the result of greed and lack of control and proper oversight combined with, intense,competitive, result driven corporate culture that made it easier to ignore Enron’s codes of ethics that gave rise to manipulation of financial reports; hidden losses and SPE’s, suspicious partnerships. Adding to the employee stress was the organization evaluation system that forced employee to either find another position in the company or have their contract terminated and therefore employees were afraid to lose their jobs and followed unethical and illegal practices.

This now bankrupt company, misappropriated investments, pension funds, stock options and saving plans after deregulation and little oversight by the federal government. However, with deregulation an increasing competitive culture emerged as the CEO Jeffry Skilling motto to his organization was to “do it right, do it now, and do it better” this was the rally cried that pushed ambitious employees to engage in unethical behavior as Enron use deceptive “accounting methods to maintain its investment grade status” (Sims, & Brinkmann, 2003, pp.244-245). As Enron continued to flourish and received accolades from the business community this recognition drove executives to continue the façade of bending ethical guidelines before their public fall from

Every business develops a set of ethical principles that they abide by. The business ethical principles intentions: it construct the business certainty in the community , maintain the employees liveried in what the business attempt to have as structural conducts and aid the employees consume principles to make ethical choices that guards the business. In a culture with a diverse assessment structure and augmented judgment visibly by companies with changeable ethics and interests, there appears to be further difficulties on business individuals to make tougher ethical assessments. In our day-to-day performances, we depend on on our ethical principles to monitor us in the correct path and do the correct things. The substance of any efficacious and perpetual business is they segment a mutual ethical matter concentrating on presenting and generating value along with allocating their business values with the citizens they network with on a day-to-day basis.

In difficult financial times, companies face various moral issues to try to keep up with their competitors. Although these issues have a direct impact on employee decision making, businesses rarely address how employees should assess the ethics of their actions and incorporate ethics into their decisions. Often this can be alleviated by creating and maintaining a corporate culture with a focus on

WorldCom, for example, was facing a downward trend in their industry. The telecommunications company was going south, especially thanks to text messaging and the internet. In addition, the government denied them the ability to merge with Sprint (a $129 billion dollar merger), which quickly halted their growth. WorldCom had built a growth strategy built upon mergers and acquisitions, instead of growing product lines and larger marketing campaigns. So when the federal government denied their ability to grow large enough to discourage competition, they had to look elsewhere to increase shareholder profitability. Another venue of motivation was of course based upon the Fraud Triangle. This diagram or model consists of three things for one to commit fraud: pressure, opportunity, and rationalization. WorldCom had all three things – leading them straight towards disaster. The CFO was facing immense pressure from stakeholders and the executive board to increase profits (and growth), he had the opportunity as he controlled the books, and he either had justification or, more probably, a lack of ethics. Applying this triangle to Enron, all three factors were present. Enron was facing immense pressure to continue their standing as one of the top 10 fortune 500 companies, as well as continuing to be named one of the world’s most

Ethical standards in business are important for every leader to know and understand. The book Ethics 101: What Every Leader Needs to Know by: John C. Maxwell discusses ethics in the world today. When people make unethical choices, the reason they do because of three main pitfalls. People do what is most convenient to them, people tend to do what they must do to win, and people rationalize their choices with relativism. In this summary, Maxwell’s definition of business ethics will be framed, examples of ethical standards and guidelines, the meaning and contrast of ethical thinking and ethical behavior, and how to avoid these major pitfalls to live an ethical life. The

(Panza & Potthast, n.d.) Ethics is very important to a company’s success. Ethical behavior can bring benefits to a business. They can attract customers, which can lead to a boost in sales and profits. It can attract the right employees and increase productivity. It can also attract investors and keep the company’s share price high. Unethical behavior on the other hand can damage a company’s reputation and make it less appealing to stakeholders. It could also result in lower profits.

The study of Ethics is an important branch of study. It is as important as the study of the sciences, math and business. At its core the study of ethics provides a framework to make decisions on how we conduct our lives. Almost every action we take has ethical implications that affect our own lives and the lives around us. This is important to consider in the business world, since the decisions made by business organizations can affect the lives of millions of people world wide, as well as the ecological health of the planet. The first four chapters of the text provide readers with several interesting ethical concepts that have implications for business professionals. The two topics that stood out as having the greatest potential for wide ranging effects are the historical perspective on business ethics and hiring ethical people. Studying and understanding history provides a strong foundation for making decisions in the present. Hiring decisions have as large effect on an organization’s success as purchasing or marketing decisions.

Today’s business world presents numerous ethical issues. In today’s world above board/moral ethics in organizations do not often materialize intuitively. Organization must strive to provide employees with a clear understanding of the overall company vision. This will aid employees in practicing the code of ethics, policies and procedures in the workplace. Companies must be unwavering in continuously delivering the uppermost ethics of provision in which customers, applicants and employees are entitled to under fair business practices. One major core value is to uphold responsible and fair business practices.

Companies are supposed to be able to achieve and demonstrate an ever increasing performance showing improvement on leading in their industries to acquire competitive advantages. Having a high level of performance could be greatest achieved with competent and motivated employees. The conduct of business in an organization with an ethical manner is of great importance to secure an increasing performance as well. Organizations functioning towards ethical standards should ensure unbiased applications of business and recall a sense of justice to stimulate motivation among their employees. Employees that are motivated through a positive ethical organizational climate and leadership do much better than a less motivated employee. This promotes the organizational achievement that causes

Every organization also has a profession responsibility to conduct business honestly and ethically. Our readings reported, “Experts estimated that U.S. companies lose about $600 billion a year from unethical and criminal behavior” Kinicki and Kreitner (2009). The organization could avoid having ethical issues by meeting the

In their personal and professional lives, people can and, unfortunately, sometimes do go against their moral and ethical standards. Ethical standards are what it means to be a good person, the social rules that govern our behavior. Ethics in business is essentially the study of what constitutes the right and wrong or the good or bad behavior in the workplace environment. A business is an organization whose objective is to provide goods or services for profit. The organization has a group of people that work together to achieve a common purpose. The moral challenges that these men and women face each day along with a whole range of problems that could occur, are why ethics plays such an important

Cheats, bribery, scam, swindle and lies are always part of the business environment. These acts of dishonesty and deception are lurking in the business world for their prey. As Smith proposed, “Deception would appear to be the norm rather than the exception in business” (Smith 19). Although deception is common in the corporate world, there are always outbursts of trauma and disturbance every time the business history observes the occurrence of major fraud, failures and other illegal acts. Enron Corporation, dubbed the most innovative company in corporate America from years 1999 to 2005 by Fortune, was not spared from the epidemic of dishonesty. The question is: what causes or influences people and society to commit and indulge in such deeds of wickedness and bitterness in the corporate world? Are they motivated by greed, temptation, lust, pleasure, financial gain, survival or just sheer joy of entertainment? For those who were caught in the act and brought to justice and put behind bars, were their actions and deeds of dishonesty justifiable in the eyes of the public? If no, were their punishment and jail time sentenced or meted out by the judicial system reasonable or warrantable according to the crime committed? There are many crucial factors and forces at work which we need to consider and ponder circumspectly as major disparagement like Enron was much more complicated than it may seem on surface. There were many grey areas and not so straight forward as black and white.

In the modern world, two things are most sought after: goodness and prosperity. However, given the innate nature of mankind, and his compulsions towards greed and selfishness, complete morality is impossible. This idea has roots in the definitions and ideals found in utilitarianism, a term that will be defined later, and has led many to call business ethics an oxymoron. “In the US generally, the ethical road that is paved with good corporate intentions and constructive programs includes some bumps,” (McClenahen 60). Although bumps may exist, many companies are striving for excellence in this area as statistics show ethics are related to customer loyalty 's. These businesses have found that improvements can be found through understanding and action. Business leaders can increase morals by understand utilitarianism, leadership, correct forms of communication, and how these affect customers.