Assignment 1

Define the word ethics and the term value system?
 

     Ethics are the rules of conduct recognized in respect to a particular class of human actions or a particular group, culture, etc.     A value system is a set of consistent ethic values and measures used for the purpose of ethical or ideological integrity. A well-defined value system is a moral code.

What trends have motivated the need for organizations to foster ethical environment?

     The ethical work environment of the organization is a key concern of every leader, especially as it is now clear that a company’s credibility can be devastated by the behaviors of relatively few employees.

     Almost all employees and leaders strongly prefer to work in an ethical environment, one with clear values. The trust and openness of such environments have been shown to have positive effects on interpersonal relationships, team effectiveness and organizational profitability.

In what ways do good ethics engender good business?

Organized

• Have a written plan of objectives and activities for the day, and stick with it as far as you can. 

Appreciative

• Acknowledge the contribution your employees have made to your success. Pay them well, and they will continue to serve you well. Additional benefits and profit-sharing schemes will make them even more committed and productive. 

Optimistic

• Focus on your current and future success rather than any past failures. 

Persistent

• Never give up. Give it another go. It’s often that last effort that produces the result you want. 

Educated

• Grow your mind by reading and listening to tapes or CDs in your areas of interest. You’ve made a good start with this web site. Keep it up! 

Valuable

• Constantly aim to give value to your customers and shareholders. Help them to grow in some way, improve in some way or profit in some way. 

Alert

• Always be on the look-out for new opportunities. Anticipate the needs and wants of other people and you could make a fortune. Find gaps in the market and fill them. 

Dependable

• Meet all your business, social and moral obligations punctually, honestly and honourably. 

Honest

• Maintain honesty and integrity in everything you do. 

Firm

• Don’t be afraid to charge what you’re worth. 

Quality-oriented

• Manage your business for constant mistake avoidance. Your whole corporate philosophy should stress quality and service. Put in place a fail-safe set of management procedures and controls.

Briefly summarize they key provisions of section section 4044 of the Sarbanes - ox leg act. How might it affect the accounting practices of an organization?
      Issuers are required to publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting. This statement shall also assess the effectiveness of such internal controls and procedures.

    The registered accounting firm shall, in the same report, attest to and report on the assessment on the effectiveness of the internal control structure and procedures for financial reporting. Its burdensome cost to corporations and its adverse impact on the competitiveness of American capital markets.

What are they key reasons that corporations need to promote an ethical work environments?

     In today’s troubled world, corporations seem to have lost this “common knowledge,” and have instead swapped it with an obsessive drive for profits – at any cost. To understand how imperative ethical behavior is, you have to consider the impact that this has on “trust”, because that’s what it all comes down to. An employee or consumer will not want to invest their time or money in a company they don’t trust, and if there is no investment, there is no company. Simple.
 

     Although it is always easy to pinpoint the exact reason (s) for the failure of a corporation, it is slightly more difficult to put a finger on the causes of success. Especially when it comes to ethics as a guide to good behavior – or as a ‘brake’ to ethical transgressions.

The goodwill that socially responsible activities create can make it easier for corporations to conduct their business. Explain what this means and provide example

     A company shows corporate social responsibility when it shapes its policies to have a positive impact on society and the environment. Accomplishing this means developing policies, daily operating procedures and corporate activities with social responsibility goals in mind. As an additional measure, some businesses publicly disclose how far they have advanced toward these goals.


      For example, a corporation can both profit and be socially responsible through methods such as recycling. Creating environmentally-friendly products is another way companies can show corporate social responsibility. 

Identify specific actions that corporations can take to improve business ethics.

     Companies must have corporate ethics policy .Clearly define personal, social and business behavior expectations and procedures. Establish information protection, client confidentiality and other ethical policies relevant to their business.

Bring in outside experts to give workshops or seminars on professional and corporate ethics. Provide employees literature or guidance for acting ethically in a professional setting.

       Behaving honestly means that a business does not attempt to deceive others. This covers a lot of ground, from accounting fraud, to claiming that a product does something which it was never designed to do.

      Openness is a subset of honesty. It means that a business keep others informed about what it is doing and why. This does not mean giving away proprietary information, or tipping off competitors as to strategy, but simply letting others feel like they are in the loop.

    Behaving consistently means not changing what a company does over time without reason. For example, if a customer calls MegaBank to check his account balance, that customer should be treated the same way every time. He should not get prompt service on one call, then a brush-off on the next, and be assessed a $2 fee on the third.

        Fairness is the flip side of consistency, and means treating all members of a group in the same way. Fairness does not mean that everyone gets identical treatment, but that when the treatment is different, it is for reasons which are the same for everyone.

       Probably the hardest part of behaving ethically is working in the best interests of others. This means that an ethical business needs to actively promote the interests of its employees, customers, community, and shareholders. Merely not getting in the way is not enough.

What is the purpose of a (business ethics) corporate code of ethics?

     A code of ethics reinforces the moral principles and commitments of an organization by spelling out acceptable and responsible behavior in a way that is clear to all within the organization. It also tells others what the organization stands for and what to expect when doing business with it.

What is meant by principle - based decision making?

       That's when you make a decision based on what you believe to be right, not what others pressure you to do, or what might get you ahead.
Your principles are the things you believe in.

What pressures might be a place on employees that make it difficult for them to perform ethically

   Whenever someone does something in the business world that is regarded as unacceptable, there can be various forms of criticism. However, outside of breaking the law, people may have a hard time articulating why the actions were bad. After all, the person who committed the acts may have been comfortable with the ethics of their decision.

     Some major problem with employees is that money is involved. With money involved there is a constant temptation to do things that are beneficial for the individual and the organization. At face value this may not be a major problem, but it can quickly dissolve into a string of bad choices, particularly if individuals do not feel particularly compelled to follow a certain moral standard. 

       Money may not be the root of all evil, but it can certainly cause people to head down the wrong path. Employees can justify just about anything if they have a particular viewpoint on the world. Ethics is one way to keep individuals and organizations grounded, but ultimately people must recognize that not everyone can be trusted to do the right thing in all occasions.

  

Outline and briefly discuss a seven step approach for ethical decision making.

Integrity

        To make an ethical decision, the decision-maker must feel largely autonomous. If he does not feel free to make the decision himself, but instead feels that he must make a certain choice as a result of outside pressures, he is more likely to make a decision that is unethical. When a decision-maker does not feel he has autonomy, the choice he will likely make will not be his own, but instead one that he is influenced to select. This could perhaps lead him into unethical territory, as whoever is exerting pressure may have a hidden agenda. The decision-maker has to recognize this as the situation, then be guided by his integrity, allowing this to supersede any insecurities he may have about lack of autonomy.

Consideration of Impact

        When making decisions, the decision-maker must first consider the impact that her decision will have upon others. By considering the lasting impact of her decision, she can improve her chances of making an ethical decision in which all affected individuals' needs are met to the greatest extent possible.

Legalities

     Often laws and regulations must play a part in the decision-making process. If an individual is making a decision with legal ramifications, he must first ensure that he understands the laws and other rules that should necessarily impact his choices, so that the choice he makes is in line with these laws.

Nonmaleficence

       Some decisions have the ability to cause harm. If an individual is making a decision that could prove harmful to others, she must reconsider and choose the option that is least damaging to others.

Fidelity

      If the decision-maker has made a commitment in the past, he must remain faithful to it. If he makes a decision that is contrary to this commitment, this will be likely be perceived as unethical, as he would have essentially gone back on his promise. For example, if he agreed to stick with one supplier for a set period of time, then switches to another before the stated time period has elapsed, the ethics of his decision may be called into question.

Fairness

       Decision-makers should put effort into not allowing bias to influence their decisions. If, for instance, an individual allows her feelings for a particular person or group of people to influence her decisions, her decision may not be an ethical one.

Input Receiving

       Generally, ethics dictates that decision-makers should take the wants and needs of others into consideration when making decisions. For optimal ethical decision-making, decision-makers should give others a voice and consider the concerns or needs expressed before arriving at an ultimate decision.

Identify several areas in which the increased use of IT has raised ethical concerns.

        Data access and capture, processing speed, tracking and monitoring, and job redesign are just a few examples of IT capabilities with ethical considerations.

• Who should have access to data?
• To whom does data belong?
• Who is responsible for maintaining accuracy and security?
• Does the ability to capture data imply a corresponding responsibility to monitor its use?
• Should data patterns be analyzed to prevent possible risks to employees or customers?
• How much information is necessary and relevant for decision making?
• Should certain data "follow" individuals or corporations throughout their lives?
• Do organizations maintaining permanent records have a right to charge for their use?
• Are there consequences to receiving data in more timely ways?
• Does IT lead to job elimination, job routinization, or job enhancement?