Question

You are required to complete a research-based case study. This will encourage you to explore ethical issues in business, using materials outside the unit texts.

INSTRUCTIONS

Choose one of the corporate cases listed below that has attracted media attention due to ethical issues:

• Monsanto

• Coles Supermarkets

• Arthur Anderson

• Nike

• Beech-Nut Nutrition Corporation

A zero mark will be awarded for this assessment task if a student uses a corporate case which is not listed above. If you are a repeating student, you should choose a Case Study that is different from the one you attempted before in order to avoid possible self-plagiarism issues.

Use the Internet, newspapers, and business magazines to research your chosen corporate case. You should produce a 1,000-word essay (excluding the reference list) to address the following points, using the case you have chosen from the list above:

1. Provide an overview of the company’s background, i.e., its business operations, etc.

2. What ethical issue has arisen? Clearly explain the ethical dilemma.

3. Clearly identify and evaluate the stakeholders that were impacted by the ethical issue.

4. Was the decision made by the involved parties ethical? How would the business be positively/negatively impacted by the decision? Explain your answer.

5. Detail your original view on business ethics. How has your view changed after attending lessons and completing this case study assignment? Explain the differences and/or similarities to your original view

Answer 1

Overview

Each organization has its own code of ethics, which every individual in the organization must respect and adhere to. An ethics violation happens if workers refuse to behave in the manner expected and set down in the organization's code of ethics. An example of a violation of an ethical code is when a individual presents false information which affects the activity of the organisation. Over the years, workers of several companies have infringed on the code of ethics, triggering massive controversies that nearly led to businesses kneeling down.   

Applied ethics is a division that deals with the management of the money resources of an organisation. Accounting is not just a profession, but is a public service that ensures that financial resources are properly used to deliver the company's overall performance. That is why the accounting profession has in recent years been subject to public scrutiny. Accordingly, every accountant shall adhere to their own set of standards and code of ethics. Failure to abide by these laws can have a financial effect that can paralyze a organization at times. Which is why financial scandals are on the rise worldwide. As a result of these concerns, governments and organizations have established strict regulations in order to reduce financial mistakes.

Accounting malptracices at Enron

Regardless of the company they work with, accountants are facing growing challenges. Because of these obstacles, an accountant is responsible for ensuring that they resist pressures and tentations that may lead them to financial misconduct. An accountant should bear in mind that violating the principles of accounting leads to both criminal and ethical obligations that can inspire them or permanently jeopardize their careers.Irrespective of how many rules, burdens or sanctions are enforced, one or two individuals would still break a particular code of accounting ethics. Enron was a perfect example of an organization.

Much like most companies, Enron had a well-structured and respect-basing code of conduct for all of its employees. Several senior staff and juniors were found guilty and criminal charges were launched against them after accounting malpractices were uncovered in Enron. Those workers have been accused of intra-trade, bribery and other accounting abusses.The auditors who audited the corporation after the scandals were revealed found who Enron senior financial officers were carelessly spending the company's money unaware of the risks that the company would face. It opened up the gates, and the business was brought up to its knees to everyone who felt like stealing.

The ethics code laid down by the organization was broken by the top management team. That is very simple. The rich tradition of integrity, completeness and cooperation of the company was abused by the leading manager involved in the fraud. The managers have been manipulating the numbers for their benefit and the organization has lost millions of dollars. This deception demonstrates that the workers have not trusted in the company's principles of pf ethics and that they have been broken. The lack of contact between various departments contributed also to the failure of the organization. This was because both departments were held apart, making it impossible for people in one department to know what's happening in another. That is why Enron has failed, as all workers have been involved in financial fraud, beginning at the highest management level to the lowest management level. Some of the workers accused themselves of financial misconduct and some were incarcerated.

Just after the company started to struggle financially started did the harsh truth in the management of the company begin to dawn. Amid the outbreak of the scandal, inquiries began and the managers who were responsible for the smuggling were named. It clearly demonstrated that the manager did not comply with the ethics code of the company, nor was it used as an example for other workers.

Enron abused faithful conduct by altering documents and keeping them unavailable to the public according to the disclosure standards set down by GAAP. The prudence principle was indeed the accounting principle infringed by the Enron board. This was demonstrated by the cautious way the financial resources of the company were spent. The corresponding definition and content over shape were other principles that were abused by management at Enron.

One step the executives at Enron would have taken was to ensure that all employees of the company stick to the existing values. The top management had to serve as models to ensure that other junior workers followed suit. We would also have demonstrated leadership skills instead of engaging in wrong practices. There would have been emphasis on compliance and consistency with the code of ethics. Accounting principles and routine auditing carriedout would have been implemented to insure that any effort has been made to misappropriate the funds of the business.