Question

Discuss the role of ethics in Corporate Governance from the perspectives of: A. Stakeholders B. Managerial...

Discuss the role of ethics in Corporate Governance from the perspectives of:

A. Stakeholders

B. Managerial Opportunism

C. Agency

D. Executive Compensation

Homework Answers

Answer #1

Role of Ethics of;

  1. Stakeholders: The stakeholder’s ethics decide the business which and the steps taken to develop that business. Their ethics decide the way the projects are to be won or executed. Their decision affects the complete process of further work. For e.g. Stakeholder’s may be ready to bribe officials of the client company to win projects.
  2. Managerial Opportunism: This, itself is not considered right in ethical terms, as the manager uses the information from the employees or team members for personal gains rather than the company.
  3. Agency: Agency is a particular organization which will work in a particular environment to achieve a particular task. This task can be done as per the ethics they follow. For e.g. An agency is hired to procure material for the project. Due to the ethics followed by the agency, it can provide inferior material than what is required, just to increase their profit.
  4. Executive Compensation: The compensation of a particular executive depends on the factor what the company has analyzed. However, looking at ethical terms, the executives have to be paid fairly for you to succeed, as the executives are not easy to find.
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