This website uses cookies to ensure you have the best experience. Learn more

Ethics: Complexity And Transparency In The Business World

2029 words - 9 pages





In today’s world, businesses have moved from complicated to downright complex. Firms, industries, and global business systems continue to invest in, employ, utilize, and revolve around many varying, technical, formal tools and mechanisms in the business world. In the context of global business, complexity can be loosely defined as the state of intricacy of interactions of people, objects, events, and transactions. The modern business world and the business environment is highly complex in ...view middle of the document...

Although “companies legitimately use SPEs to access capital and manage risk, Fastow’s sophisticated and complex use of SPEs was abusive and resulted in misleading financial information about Enron”.1 The main issue was that the ownership structure of the SPEs and business transactions were so complicated that no one was able to uncover the conflict of interest or ethical issues behind these transactions. This included creditors, auditors, and even potential investors. Despite public reporting of financial statements, Enron was never completely transparent with their business operations and transactions to their shareholders. If the firm had been more transparent to the public regarding the use of SPEs and the main purpose behind the usage, the scandal would not have reached such damaging heights.


Henderson et al., 2009

Another similar instance regarding complexity was uncovered in the late 2000’s when executives of RIM were accused of backdating stock options. According to the SEC, agreements and offer letters of the executives failed to acknowledge the fact that options were granted in-the-money. Although using stock options as a method of compensation is legal, granting in-the-money options is illegal. Crucial details from documentation such as issue date and price of options is essential in transparent reporting, which in RIM’s case were missing. This is a clear example of concealing information to benefit parties other than shareholders. Additionally, this goes against the SEC code of conduct and the “SEC’s resolve to assure full and accurate disclosure to U.S. investors by foreign issuers”.2 It is a requirement for all executive compensation to be declared, with the value of stock options needing to be accurately represented. With the lack of transparency, shareholders did not get an accurate picture of the compensation levels as the stock options were backdated. With stronger transparency, such an event could be prevented since executives would have to report all details regarding compensation. If all details are made public including stock option grant date, vesting periods, and option prices, management would be discouraged from participating in unethical behavior. Next, lack of transparency is not just a firm-specific problem. Occasionally, this issue can permeate an entire industry, leading to a far greater damage than what any individual firm could cause. The 2008 financial crisis, for instance, cost the U.S. economy an estimation of $12.8 trillion dollars while inducing a recession that the world is still recovering from.3 The largest contributor to this financial meltdown is arguably the extremely complex yet grossly opaque credit...

Other Papers Like Ethics: Complexity and Transparency in the Business World

Ethics and Corporate Responsibility in the Workplace and the World

1658 words - 7 pages Assignment #2: Ethics and Corporate Responsibility in the Workplace and the World This paper will explore the common issues of what a lot of companies face when dealing with employee relations and factors in the reality of some companies that go to the extreme into violating laws to hide illegal practices. These are not isolated cases; these bad practices are more common than we think they are. It really takes a good solid manager to

Ethics In Business And Management Essay

2126 words - 9 pages Nowadays, with the economic crisis going around the world, being a profitable company is hard, but being a profitable and social responsible corporation is even harder. In the Barrick mining company case, one may notice there are many problems confronting the firm ranging from property vandals, trespass, sexual assaults, and deaths to fraudulence conducted by Tanzanian police. Many may argue that as long as the region is plagued by unemployment

Fairness And Transparency In University Admission Policy: Are The Public Universities In Bangladesh Making A Shift?

1276 words - 6 pages Fairness and transparency in university admission policy: Are the public universities in Bangladesh making a shift? An editorial piece Submitted by Raihan Mahmood Kadery MARIHE-2 Beijing Normal University Submitted to Prof. Lauren lla Misiazek Faculty of Education Beijing Normal University 1|P age Fairness and transparency in university admission has recently become a burning issue in civil society, higher education community and

Ethics in the Business Environment

1307 words - 6 pages color, religion, race, national origin or sex. Distinguishing between right and wrong business dealings The Rub and Grub Company trusts that the individual selected to work for the company acts ethically in their day to day life which will therefore carry over to the workplace. Some common universal principles of ethics that is sought and is part of the culture of The Rub and Grub Company are as follows: • Impartiality – being objective and open

Business Ethics in the Workplace

1381 words - 6 pages the potential of their hair, and also the multi-cultural experience of women across the world. As I’ve stated previously, I work for a public school therefore we don’t have extra money laying around. This is where I use a technique called a joint venture; where my organization finds a partner person or group to fund and plan these international experiences for staff and students. This plan has so much potential because as a woman in America we

The Effectiveness of Business Ethics in Education and Today’s Workplace

2556 words - 11 pages environment they study the ethics in their workplace culture and often find that educational ethics training does not have any value in the work world. “Studies have shown that workers who espouse action on the basis of ethics are often derided as hypercritical prudes or cloying moralists” (Moberg, 2006. pg. 307). This paper will explore the topic of business ethics by the use of critical review of professional and scholarly journal articles, as well as

Morality And Ethics In Corporate World

5527 words - 23 pages companies can access individuals’ information on the history of the websites a person has visited to develop customer trends through cookies, web bugs, and other means. Following ethical principles is essential to keep corporations on top and away from any negative consequences that unethical practices may lead to. This paper will look at different areas of ethics involved in the corporate world, such as, privacy, technological trends, and

Ethics and Moral Issues in Business

674 words - 3 pages accomplishments and discover parts where advancement is required. Business ethics can be defined as written and unwritten codes of beliefs and values that manage choices and actions within a company. In the business world, the company’s value sets standards for defining the difference between good and bad choices and behavior. In the most basic terms, a definition for business ethics boils down to knowing the difference between right and wrong and

Cultural Issues and Ethics in International Business

1498 words - 6 pages Cultural Issues and Ethics in International Business Introduction The expansive and unstoppable process of globalization has forced employers to form their ability to trade and negotiate with the outside world. However, it is important not only they are immersed in this subject, your staff, or one who is qualified to do so, you should also have access to the most significant aspects of foreign trade, logistics, and the impact. Companies

Ethics and Credibility in Business Communications

586 words - 3 pages Ethics and Credibility in Business Communications Kristen Barnes COM/295 March 27, 2016 Randi Barnes-Plante Ethics and Credibility in Business Communications Social Media can be an effective form of communication for business to consumer relationships. Not only does it allow the business to keep everyone up to date on the latest developments within the company, but it also allows the consumer to reach out to the business without

Social Work and Its Code of Ethics in the West and the Arab World

2182 words - 9 pages sociological theory with little or no real social work skills to help those who come to them for help. This is because social work knowledge and practice maintained Western assumptions regarding human nature and the nature of social problems in their transmission to the Arab world, and these endure till today. To illustrate how social work Code of Ethics should differ in matter of the multicultural views of the world, the view of education in

Related Essays

Importance Of Ethics And Social Responsibility In The Business World

1388 words - 6 pages IntroductionStrategic ethics and social responsibility are two of the most important, yet perhaps most misunderstood concerns in the world of business today. By their very nature, these fields are controversial, and there is no universally accepted approach for solving their questions. On the other hand, government is encouraging organizational accountability for ethical conduct, and organisations are being asked to prevent and control

Business Ethics Across The World Essay

1136 words - 5 pages been at the forefront of growing concern, not only about its products and enterprises, but also about its business ethics. This article analyzes the state of ethics in business in China. China now manufactures or assembles over 50% of the world’s products. However, the world has been reeling from daily accounts of defective “Made in China” products. China has been at the forefront of growing concern, not only about its products and enterprises

Ethics And Corporate Responsibility In The Workplace And The World

2448 words - 10 pages Ethics and Corporate Responsibility in the Workplace and the World Law, Ethics, and Corporate Governance Professor Andrea Brvenik August 16, 2014 Stakeholders & PharmaCARE Stakeholders take on many forms and guises depending on the context of the business. Experts write personal definitions and musings on what they feel a stakeholder is, while others disagree and have their own, sometimes conflicting personal findings. It

Ethics And Corporate Responsibility In The Workplace And The World

1607 words - 7 pages Ethics and Corporate Responsibility in the Workplace and the World Mohammad Hawari Dr.  Andrea Brvenik Strayer University Aug.18th.2014 Introduction PharmaCare is a national pharmacy management, staffing, and consulting company , PharmaCare is caring of producing drugs and improve of quality of life . The company offers free and discounted drugs to low-income consumers, has a foundation that sponsors healthcare educational programs