The Ethics Of Business Ethics - 1586 Words

Business ethics refers to the consideration of moral decisions and responsibilities in the process of operating a business. Business ethics, practiced throughout the deepest layers of a company, become the heart and soul of the company s culture and can mean the difference between success and failure. Values drive behavior and therefore need to be consciously stated, but they also need to be affirmed by actions. Ethical business environments are created with foundations of integrity, accountability and commitment. Personal/Professional Application Integrity is defined as following your moral or ethical convictions and doing the right thing in all circumstances, even if no one is watching you. Having integrity means you are true to yourself and would do nothing that demeans or dishonors you. When employees are asked what they want from leaders it is integrity. Qualities change across culture and time, but what people say they want most in American society is integrity. When people ar e asked to define integrity, the word they mention most frequently is honesty. The leader with integrity always tells the truth as he or she believes it to be. Think about the best leader you have ever had; she or he probably had integrity. First and foremost, people want a leader they can trust. Ask yourself whether you have a reputation for integrity. (Manning 6) Integrity can be broken down into sub components: Honesty- honesty creates an open environment in the workplace and effectiveShow MoreRelatedEthics And Ethics Of Business Ethics1304 Words   |  6 PagesBusiness Ethics Varun Shah University of Texas at Dallas Business Ethics Morals are a crucial part of life. Without having principles one would never be able to distinguish the right from wrong and good from evil. Just as it applies to life in general, ethics is an integral part of doing business as well. When we here the term Business Ethics in our work place, we usually do not take it seriously and brush it off saying ‘it’s just a simple set of basic rules like not cheating and so on’. ThisRead MoreEthics And Ethics Of Business Ethics1624 Words   |  7 Pagesinvestors losing their retirement accounts and many employees lost their jobs (Accounting-Degree.org, 2015). Crane and Matten (2010) argue â€Å"After all, despite many years of business ethics being researched and taught in colleges and universities, ethics problems persist and the public remains sceptical of the ethics of business†. The big problem we face is that ethical standards are declining because of insider trading of stocks and bonds, bribery, falsifying docume nts, deceptive advertising, defectiveRead MoreEthics And Ethics Of Business Ethics1200 Words   |  5 PagesEthics meaning in simple way for average person is what is right from wrong. According to Chris MacDonald (2010)† Ethics† can be defined as the critical, structured examinations of how we should behave - in particular, how we should constrain the pursuit of self-interest when our actions affect others. â€Å"Business ethics is the applied ethics discipline that address the moral features of commercial activity (Business ethics, 2008).Working in ethical way in business has a lot of benefits which can attractRead MoreThe Ethics Of Business Ethics1471 Words   |  6 PagesReview Nowadays, the concern for business ethics is growing rapidly in the business community around the world. Business ethics are focused on the judgment of decisions taken by managers and their behaviors. The issue regarding these judgments is the norms and cultures that shape these judgments. Business ethics are concerned about the issue, how will the issue be solved and how will it move ahead along the transition analysis as well (Carroll, 2014). Business ethics can be addressed at differentRead MoreBusiness Ethics : Ethics And Business943 Words   |  4 Pagesdiscussions in Business is Ethics. Some people believe that the decisions businesses make in interest of the business has no place in ethics and that they are essentially amoral. These businesses believe that their main objective is to simply make a profit and that it does not affect the success of the business. Whereas some businesses believe that they have to take ethics into consideration, in order for their business to be a success. Richard T. De George (1999) states that ethics and business do notRead MoreThe Ethics Of Business Ethics Essay2711 Words   |  11 PagesBusiness Ethics Business ethics is a type of professional ethics or applied ethics which examines moral problems and ethical principles that come up in a corporate environment. It is applied to every aspect of conducting business. According to Milton Friedman, a company has the responsibility to generate as much revenue as it can while still conforming to the basic rules that society has set. These rules include the ones embodied in customs as well as in law. Similarly, Peter Drucker stated thatRead MoreThe Ethics Of Business Ethics Essay1097 Words   |  5 PagesResource A discusses how ethics is crucial in business. There are three key ideas used to understand this. Firstly, making ethically wrong decisions tend to cause more upset than other general mistakes as purposeful unethical actions are not as easily forgiven or forgotten. Secondly, ethics provides businesses with a broader understanding of everything to do with their business. Business ethics is effectively just business it its larger hu man context. Thirdly, being unethical can tarnish the publicRead MoreThe Ethics Of Business Ethics1064 Words   |  5 Pages　　　　Business Ethics Ethics can be viewed as the rules and values that determine goals and actions people should follow when dealing with other human beings. However, business ethics can be defined as moral principles of a business. It examines moral or ethical problems that arise in a business environment. Generally, it has both normative and descriptive dimensions. Organization practice and career specialization are regarded as normative whereas academics attempting to understand business behaviourRead MoreThe Ethics Of Business Ethics757 Words   |  4 Pagesdeciding what to do in certain situations, ethics is what guides an individual to act in a way that is good, or right. Those involved in business settings apply ethics to business situations, known as business ethics. It is expected of businesses, small and large, to follow business ethics. There is a particular framework businesses are to follow. However, the reoccurring news headlines of poor business ethics prove differently. Poor busine ss ethics include bribery, corporate accounting scandalsRead MoreThe Ethics Of The Business Ethics1431 Words   |  6 Pages BUSINESS ETHICS INTRODUCTION:- Presentation Ethics are exceptionally regular and essential good esteem that helps us to take the right choice where we think that it hard to pick between our own advantages and the correct thing to do. We are going to talk about three sections of morals Behavioral morals, Bounded ethicality and last one is irreconcilable situation. As from the names of these parts of morals, its verging on clarifying the significance of it. It clarifies why great individuals

Agency Problem †Essay Free Essays

I partially agree with the statement that managers have a severely limited amount of discretion to pursue actions inconsistent with shareholder wealth maximization. By investing in a company, shareholders aim to maximize their wealth and achieve portfolio diversification. The objective of managers is assumed to be to further these interests by maximizing the firm’s share value. We will write a custom essay sample on Agency Problem – Essay or any similar topic only for you Order Now This can be achieved by taking on projects with positive NPV and good management of short-term capital and long-term debt. However, shareholders and managers are assumed to want to maximize their utilities; so this objective may not always be the priority for managers as they may rather prefer to maximize their own wealth or further other personal interests of theirs. This conflict of interest between the two is an example of the principal agent problem. The principal agent problem occurs due to two reasons. The first is the separation of ownership from control – the principal or the shareholders may own a corporation but it is the agent or manager who holds control of it and acts on their behalf. This gives managers the power to do things without necessarily being ‘detected’ by shareholders. The second is that shareholders may not possess the same information as the manager. The manager would have access to management accounting data and financial reports, whereas the shareholders would only receive annual reports, which may be subject to manipulation. Thus asymmetric information also leads to moral hazard and adverse selection problems. The following are areas where the interests of shareholders and managers often conflict: Managers may try to expropriate shareholders’ wealth in a number of ways. They may over consume perks such as using company credit cards for personal expenses, jet planes etc. †¢Empire building: Managers may pursue a suboptimal expansion path for the firm. They may expand the firm at a rationally unfeasible rate in order to increase their own benefits at the cost of shareholders’ wealth. †¢Managers may be more risk ave rse than shareholders who typically hold diversified portfolios. †¢Managers may not have the same motivation as shareholders, likely due to a lack of proper incentives. Managers may window dress financial statements in order to optimize bonuses or justify sub optimal strategies The principal agent problem normally leads to agency costs. This has been identified by Jensen and Meckling(1976) as the sum of: 1. Monitoring costs: Costs incurred by the shareholders when they attempt to monitor or control the actions of managers. 2. Bonding costs: Bonding refers to contracts that bond agents’ performance with principal interests by limiting or restricting the agent’s activity as a result. The cost of this to the manager is the bonding cost. 3. The residual loss: Costs incurred from divergent principal and agent interests despite the use of monitoring and bonding. However the manager’s discretion is quite limited in practice. There are a number of internal and external solutions to agency costs for shareholders. Internal: †¢Well-written contracts ensure that there are fewer opportunities for managers to over consume perks. †¢An external board of directors could be appointed to monitor the efforts and actions of managers. This board would have access to information and considerable legal authority over management. It could thus safeguard information and represent shareholder interests in the company. †¢The board could hire independent accountants to audit the firm’s financial statements. If the managers don’t agree to changes proposed by auditors, the auditors issue a qualified opinion. This signals that managers are trying to hide something, and undermines investor confidence. †¢Compensation packages where the reward to the manager is linked to firm performance. This includes performance related bonuses and the payments of shares and share options. Ambitious, lower managers are a threat to the jobs of inefficient, evading ones. External: †¢The lenders of a company also monitor; a bank for instance would track the assets, earnings and cash flows of the company it provides a loan to. †¢Managerial labor market: Poor managers may not get another job or get a much poorer one. Ultimately the most important indicator to the labor market of managerial performance is share price. †¢Capital Markets – A falling share price increases the threat of a take-over, which can often result in redundancies. More concentrated shareholding by outsiders can lead to monitoring by them and improve managerial performance. However there are a few problems with these solutions though, which make it possible for managers to circumvent them to a small extent. In order to keep the share price high, managers may focus more on short term profitability at the cost of long term profitability. They may use gimmicks to temporarily boost the share price and neglect spending on research, development and H. R. They may also provide sub standard products and cease providing services for old, or relatively less important products in order to reduce costs and make a quick profit. This damages the company’s reputation, reduces its competitiveness in the future and thus affects long-term shareholder value negatively. While block holders may act as external monitoring mechanisms, they can also have private incentives to go along with management decisions, which may be detrimental to firm performance. Writing better contracts may reduce the problem of asymmetric information, but not fully solve it. This is because the design of such contracts is technically infeasible due to various reasons such as the difficulty of foreseeing all future contingencies. Dispersed shareholders often do not exercise the few controlling rights that they have. This leads to a free rider problem where shareholders would prefer to let other shareholders do the task of monitoring as they cannot justify spending on it over the few shares that they each own. In order to resist takeovers, managers may design contracts that compensate them in the event of loss of control due to the takeover. They may also undertake targeted repurchases and devise a poison pill, which changes the fundamental aspects of the corporate rules without the knowledge of shareholders. While incentive schemes such as shares and share options are effective, they are still reactive in the sense that they provide no mechanism for preventing mistakes or opportunistic behavior. Managers may continue to focus mainly on quarterly goals rather than the long term as they are allowed to sell the stocks after exercising their options. By focusing on quarterly performance, managers could boost the stock price and avail higher personal profits on their subsequent sale of stock. Managers may also sell their shares as soon as they are high, leading people to think that they lack confidence in their own operations. This may adversely affect share price. Share options also increase the risk of EPS dilution from an increase in shares outstanding. Managers may often ‘window dress’ financial statements as the company must be seen to perform well in order to improve share valuations. They may report inaccurate information, especially if their short-term rewards outweigh their long term ones such as pensions. It also encourages shareholder approval, and so would lead to less difficult AGM’s. Many managers may hide the true value of assets in order to hide the losses they incurred while buying them. Window dressing also involves managers presenting statistics such that they highlight the perceivably best bits about the company’s performance and avoid emphasis on the worst aspects of the previous year’s business. Other common practices of this include disguising liquidity problems and fraudulent representation of liabilities. This gross misrepresentation of debts has been seen with Enron in the US, where $billions of long-term liabilities were hidden off the balance sheet. Its executive Jeffery Skiller, initiated the use of mark to market accounting, while hoping to meet Wall Street expectations. Enron ultimately became bankrupt while its shareholders suffered huge losses. Despite having model board of directors and a talented audit committee, Enron’s managers were able to make it attract large sums of capital to fund a questionable business model and hype its stock to unsustainable levels. Worldcom, a telecommunications company in the US, inflated profits by disguising expenses as investment in assets and inflated revenues with bogus accounting entries from corporate, unallocated revenue accounts. In mid 2000, its stock price began to decline and CEO Bernard Ebbers persuaded WorldComà ¢â‚¬â„¢s board of directors to provide him corporate loans and guarantees of over $400 million to cover his margin calls on Worldcom stock. The board had hoped that the loans would avert the need for Ebbers to sell the substantial amounts of WorldCom stock that he owned, as this would have further reduced the stock’s price. However, the company ultimately went bankrupt and Ebbers was ousted as CEO in April 2002. The shareholders suffered massive losses as they watched World Com’s stock price plummet from $60 to less than 20 cents. Thus, we can see that while there is room for managers to indulge in personal wealth maximization, it is quite difficult to do so. Usually, the solutions tend to be adequate enough to correct the conflicts, and restrict manager’s discretion. How to cite Agency Problem – Essay, Essays

Black Vs White Essay Research Paper Black free essay sample

Black Vs. White Essay, Research Paper Black vs. White How can a author have a character make the reader feel warm interior when reading about them, or experience choler and disgust towards the character? A manner is the usage of visible radiation and dark imagination. Imagery is a really of import facet of composing used to portray a state of affairs or character as more existent or to expose their personality. Charles Dickens uses imagination in his book Oliver Twist to expose his characters as good, light or bad, dark. This type of imagination makes the reader experience more comfy when reading about the good characters while experiencing uncomfortableness toward the bad characters. Dickens uses visible radiation and dark imagination in his book Oliver Twist to do the reader like or dislike the character, make the character # 8217 ; s image more graphic, and excessively do the reader image the characters in their heads. Oliver the chief character in the book is displayed as a good, light character. When he is being described the room lightens up there is a batch of brightness portrayed in his image. # 8220 ; Oh! that # 8217 ; s the male child, is it? # 8221 ; said the mortician: raising the taper above his caput, to acquire a better position of Oliver. # 8220 ; Mrs. Sowerberry, will you hold the goodness to come here a minute, my beloved? # 8221 ; ( Dickens 52 ) . This quotation mark makes the reader image Oliver radiance from the candle flame. The reader feels that Oliver is a warm character and most people feel consolation with him and bask reading about him. Another quotation mark that illustrates the immature male child # 8217 ; s bright character is # 8220 ; For a long clip, Oliver remained motionless in this attitude. The taper was firing low in the socket when he rose to his pess. Having gazed carefully round him, and listened intently, he gently undid the fasteners of the door, and lo oked abroad. # 8221 ; ( 77 ) . Dickens makes the reader commiseration the orphan in this quotation mark. It makes the reader image a hapless male child with a taper hardly illuming up his face, it makes the reader feel sorry for Oliver but yet still portray him as good. Dickens with these quotation marks early in the book has set the tone for Oliver being portrayed as a good character. On the bad side, Dickens uses darkness and shadow to do the reader frisson at the idea of some characters. The reader will subconsciously experience uncomfortableness when reading about the bad characters and their dark ways. Most of the bad characters are selfish and avaricious looking after lone themselves. An illustration of a quotation mark used to do a reader feel non at easiness is # 8220 ; With the piece of staff of life in his manus, and the small brown-cloth parish cap on his caput, Oliver was so led away by Mr. Bumble from the wretched place where one sort word or expression had neer lighted the somberness of his baby years. # 8221 ; ( 32 ) The quotation mark makes the reader experience the realisation of walking off into the darkness of a alone unkind childhood. Dickens so uses this quotation mark to portray two characters as bad at the same clip # 8220 ; The mortician, who had merely put up the shutters of his store, was doing some entries in his day-book by the visibl e radiation of a most appropriate blue taper, when Mr. Bumble entered. # 8221 ; ( 52 ) . The candle combustion is really blue giving the reader an uncomfortable feeling about the room. The mortician merely put up frissons, which means the room is dark because it blocks out the outside visible radiation. The taper besides gets blue when Mr. Bumble walks in giving the reader a bad feeling about him excessively. Dickens enforces the usage of dark imagination in this quotation mark by stating # 8220 ; a really appropriate blue taper # 8221 ; by stating this Dickens is stressing the darkness of the room. When reading about these characters the reader will dislike and non experience comfy with the characters. Another version of light imagination is the figure of a assisting manus. Person making out to assist one in demand makes a reader feel really warm interior and Li ke the character. A bright face with a warm manus is an image that everyone can visualize as good. Mr. Brownlow is that assisting manus in this book, he helps Oliver and invites him to remain in his place because he sees that Oliver’s life was traveling down hill. â€Å"He shortly fell into a soft drowse, from which he was awakened by the visible radiation of a taper: which, being brought near the bed, showed him a gentleman with a really big and loud-ticking gold ticker in his manus, who felt his pulsation, and said he was a great trade better.† ( 109 ) This quotation mark makes the reader makes the reader feel comfy with Mr. Brownlow by demoing him assisting Oliver out and being sort at the same clip demoing a taper illuming up his face doing him be seen as bright and good. However, a quotation mark can besides do the character seem selfless and like a male parent â€Å"Very good, † replied Mr. Brownlow smiling, â€Å"but no uncertainty they will convey that a bout for themselves in the fulness of clip, and if we step in to prevent them, it seems to me that we shall be executing a really Quixotic act, in direct resistance to our ain interest- or at least to Oliver’s, which is the same thing.† ( 370 ) The quotation mark makes Mr. Brownlow seem like a loving, altruistic parent. Light imagination can be used to do a character seem as a benevolent male parent figure. The character that is displayed in the book as the darkest adult male in the universe is Bill Sikes. Dickens uses really dark imagination to depict him. The reader feels highly uncomfortable and much disfavor for this character. All characters in the book disfavor him and at the terminal of the book he is the character that pays the ultimate monetary value. Dickens describes him in really dark glooming state of affairss, # 8220 ; In the vague parlor of a low public-house, in the filthiest portion of Little Saffron Hill ; a dark and glooming lair, where a aflare gas-light burnt all twenty-four hours in the winter-time ; and where no beam of Sun of all time shone in the summer: there sat, dwelling over a small pewter step and a little glass, strongly impregnated with the odor of spirits, a adult male in a velveteen coat, drab trunkss, half boots and stockings, who even by that dim light no experient agent of constabulary would hold hesitated to recognize as Mr. William Sikes. # 8221 ; ( 138 ) Merely this one exceptionally long quotation mark makes the reader experience much disgust towards Bill Sikes, and makes the reader want something to go on to him to finish the narrative. A reader can experience hate towards a character from his attitude by being able to associate the character with an animate being or person they know such as this quotation mark # 8220 ; Dogs are non by and large disposed to avenge hurts inflicted upon them by their Masterss ; but Mr. Sikes # 8217 ; s Canis familiaris, holding mistakes of pique in common with his proprietor, and labouring, possibly at this minute, under a powerful sense of hurt, made no more ado but at one time fixed his dentitions in one of the half-boots. # 8221 ; ( 138 ) The quotation mark shows the affects of Bill Sikes attitude in his Canis familiaris demoing an outside illustration of how atrocious Bill Sikes truly is. The usage of dark imagination affects the reader # 8217 ; s emotions to the extent of detestin g the fictional character. Devils did good in utilizing light and dark imagination in his book Oliver Twist to do the reader like or dislike the character, make the character # 8217 ; s image more graphic, and excessively do the reader image the characters in their heads. It created the consequence that caused the reader to either experience consolation or uncomfortableness with each character. The usage of the visible radiation and dark imagination set the tone for every action the character took in the book thenceforth because the imagination left the standing image in the readers caput of either a bright colorful good face or a dark gloomy evil face. Dickens proved that the usage of visible radiation and dark imagination is a really effectual manner to compose a book and do the characters last everlastingly in the readers mind. 324