...Ethics Audit Framework Essay # 3 Stephen Randall Texas A&M University – Central Texas Professor: Marshell J. Silva Ethics Auditing Ethics auditing by definition, an ethics audit is a “systematic evaluation of an organization’s ethics program and/or performance to determine its effectiveness.” This concept of ethics auditing is fairly new and few companies have conducted an ethics audit. However, performing such audits will likely become more mainstream as recent legislation encourages greater ethical accountability for companies to demonstrate they are abiding by the law and have established programs to improve their ethical decision making. The U.S. Sentencing Commission (the “Commission) has amended the Federal Sentencing Guidelines for Organizations (“FSGO”) whereby an effective compliance and ethics program must “exercise due diligence to prevent, detect, and report criminal conduct and otherwise promote an organizational culture that encourages ethical conduct and a commitment to compliance with all applicable law." The Commission noted there are seven minimum requirements of an effective ethics program, standards and procedures to prevent and detect criminal conduct; Responsibility at all levels of the program, together with adequate program resources and authority for its managers; Due diligence in hiring and assigning personnel to positions with substantial authority; Communicating standards and procedures, including a specific requirement for training...
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...Business Code Of Ethics YourFirstName YourLastName University title Introduction A chief executive officer cannot simply make the decision that is best for her without considering the interests of other employees, stockholders, customers, suppliers, creditors, and so forth. Integrity is the cornerstone of ethical business practices. Failure to build a business on integrity carries costs. For example, deceptive business practices may harm a company's standing in the community, decrease employee productivity, reduce customer loyalty, build resentment among employees, increase the likelihood of further unethical behavior by employees, and cause scrutiny by government agencies. Although the costs of some of these consequences are difficult to quantify, there is no doubt that they can be substantial. Evaluate chosen strategy King and Spalding is a legal firm that was founded in 1885, Atlanta. It has a total of 800 lawyers across the U.S, Europe, Asia and Middle East. Ethics Programs Companies frequently create ethics programs to establish and help maintain an ethical business environment. Some of the most common elements of ethics pro-grams at King & Spalding include written codes of ethics, employee hotlines and ethics call centers, ethics training, processes to register anonymous complaints about wrongdoing, and ethics offices. Ethics programs may include any combination of these elements. However, according to a recent survey, an ethics program with multiple elements...
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...CODE OF ETHICS Compliance is the responsibility of all the Company’s directors, officers, managers, and employees.(Capital One,2011). One is responsible for learning the details of the policies, procedures, laws and regulations applicable to one's job and for seeking guidance when needed. It is important to avoid misconduct that violates the law, this Code, or Company policies, but also the appearance of impropriety. The point, which a subject is not explicitly explained in this Code, does not relieve an employee of their responsibility to maintain the highest ethical standards under all circumstances. If one has any concern about whether their actions or inactions could violate a law, it should be discussed with their manager. While no Code of Ethics can or should replace thoughtful behavior or common sense, it can help cultivate a culture that values and rewards honesty, integrity, and accountability. (Avon, n.d.). The principles detailed in the Code will guide in “doing the right thing” and in preserving the Company’s reputation for acting with integrity at all times. TRADE REGULATION Most states have enacted trade regulation laws to ensure fair competition. These laws prohibit price-fixing and other "anti-competitive agreements, deceptive acts, and unfair competitive methods." (Pension Consulting, n.d.). Some forms of joint activities are legally permissible, but others are not. Under no circumstances, should you illegally or improperly...
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...Compliance Interview and Report Assignment BA 3301 Legal Environment of Business Associate Professor Lee Usnick, JD I. ASSIGNMENT OVERVIEW Virtually all business activities conducted in the United States are highly regulated, not only by governmental entities, but by professional entities as well. Compliance with all federal, state, and local laws and regulations is a prerequisite to the long term health and survival of a business. Also important is compliance with standards issued by the professional and accrediting bodies responsible for licensing and certification. Certain industries are more regulated than others. For example, health care, financial services, and public utilities are all highly regulated with extensive licensing and operational standards. When a business fails to comply with all applicable regulations and standards, the business and the individuals who manage it can face a variety of sanctions, from loss of license and program certification, to civil and criminal sanctions including monetary penalties and prison. In this assignment, you will learn how a person working in your selected industry meets the challenges of current compliance requirements. It is not necessary to address all aspects of compliance in this industry or selected company. Rather, you should educate yourself in broad terms about the kinds of governmental and industry standards covering your interviewee's business, then select a few key aspects to explore in depth with your...
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...interests here at Company X. All employees must abstain from using personal circumstances such as investments, association, and relationships that conflict or appear to conflict with the interests within the company. It is mandatory that each employee perform duties with great integrity, and not involve any activities that could devastate our reputation. 2. Health, Safety, and Security We are dedicated to manage the highest guidelines for our customers and all employees who conduct business within each of our establishments. This can be supported by being aware of the rules and laws for healthy and safety regulations that apply for the company, which will be posted and updated when necessary. It is the employee’s obligation to immediately report all accidents, injuries or unsafe procedures or conditions to your manager. 3. Gifts, Kickbacks and Loans Employees must be cautious that their behavior cannot reasonably be translated as a loan, bribe or other inappropriate inducement to attain a business action or inappropriately impact the recipient. 4. Confidentiality An employee must maintain all confidential information...
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...Ethics Enron's culture during their heyday encouraged an entrepreneurial spirit along with a “loose tight” management style that has been highlighted in the media and the Darden CD as being part of their success (Darden CD). However, according to Hatcher (2003), Enron had a culture of “anything goes as long as it makes money”. For example, in a thesis written by Boje, Alder, and Black, the authors claim that Enron used theatre to influence how decision makers accurately or inaccurately interpreted the information presented. As part of this "anything goes culture" between 1998 and 2001 Enron set up a fake Hollywood type trading floor on the 6th floor of Enron corporate headquarters using simulated statistics and their employees pretending to be "energy service traders to influence investors, regulators and employees (Boje, 2004). Although it maximized shareholder equity one would consider this behavior unethical. What about Enron's ethics program? Enron’s Code of Ethics was published in 2000, and even included a forward written by its chairman Kenneth L. Lay, in which he states “Enron’s reputation finally depends on its people, on you and me.” However, even with this senior level "endorsement", Enron’s Code of Ethics, their policies and procedures and the associated training were not enough to circumvent the wanton fraud at Enron that resulted in the largest bankruptcy in American history (Wilkinson, 2005). Why did Enron’s ethics policy fail? One of the reasons that their...
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...BA 3301 Legal Environment of Business Compliance Interview and Report Assignment Associate Professor Lee Usnick, JD I. ASSIGNMENT OVERVIEW Virtually all business activities conducted in the United States are highly regulated, not only by governmental entities, but by professional entities as well. Compliance with all federal, state, and local laws and regulations is a prerequisite to the long term health and survival of a business. Equally important is a business's compliance with standards issued by the professional and accrediting bodies responsible for licensing and certification. Certain industries are more regulated than others. For example, health care, financial services, and public utilities are all highly regulated with extensive licensing and operational standards. When a business fails to comply with all applicable regulations and standards, the business and the individuals who manage it can face a variety of sanctions, from loss of license and program certification, to civil and criminal sanctions that include monetary penalties and prison. In this assignment, you will learn how someone in your selected industry meets the challenges of current compliance requirements. It is not necessary to address all aspects of compliance in this industry or selected company. Rather, you should educate yourself in broad terms about the kinds of governmental and industry standards covering your interviewee's business, then select a few key aspects to explore in depth with...
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...BA 3301 Legal Environment of Business Compliance Interview and Report Assignment Associate Professor Lee Usnick, JD I. ASSIGNMENT OVERVIEW Virtually all business activities conducted in the United States are highly regulated, not only by governmental entities, but by professional entities as well. Compliance with all federal, state, and local laws and regulations is a prerequisite to the long term health and survival of a business. Equally important is a business's compliance with standards issued by the professional and accrediting bodies responsible for licensing and certification. Certain industries are more regulated than others. For example, health care, financial services, and public utilities are all highly regulated with extensive licensing and operational standards. When a business fails to comply with all applicable regulations and standards, the business and the individuals who manage it can face a variety of sanctions, from loss of license and program certification, to civil and criminal sanctions that include monetary penalties and prison. In this assignment, you will learn how someone in your selected industry meets the challenges of current compliance requirements. It is not necessary to address all aspects of compliance in this industry or selected company. Rather, you should educate yourself in broad terms about the kinds of governmental and industry standards covering your interviewee's business, then select a few key aspects to explore in depth with...
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...Compliance Officer In Accenture’s ethics and compliance program, the company uses six “core values” of stewardship, best people, client value creation, one global network, respect for the individual and integrity. Douglas Scrivner, General Counsel at Accenture, says that ethics and compliance can’t be effective if they’re only seen as “bolt-ons,” or something that is only done at the end of the day after the “regular work” is complete. “We aim to put ethics and compliance into the way our people work and lead. We seek to leverage existing processes, procedures, structures and functions to ensure the outcomes we are expecting and alignment with the goals of the organization,” says Scrivner. To better understand how the company’s ethics and compliance program is being received by employees, Accenture uses employee surveys, risk assessments and results of corporate investigations. Scrivner notes that in a recent survey, over 90 percent of employees feel that Accenture is highly ethical and that the company’s commitment to integrity has been communicated to the whole company. “Those are excellent scores for a company of more than 181,000 people,” Scrivner says. “We haven’t arrived at the end of our journey (and never will), but I am confident that we continue to move in the right direction and continually reinforce our commitment and our expectations in this area.” Caterpillar Ed Scott, Chief Ethics & Compliance Officer Ed Scott, Chief Ethics and Compliance Officer at Caterpillar...
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...Competency 3006.1.5: Legal and Regulatory Requirements Overview Dodd-Frank Wall Street Reform and Consumer Protection Act Under the Dodd-Frank Wall Street Reform and Consumer Protection Act (passed in the wake of the 2008–2009 financial crisis), the Securities and Exchange Commission (SEC) will pay 10 to 30% of the amount the government recovers from financial fraud if the whistleblower provides original information leading to a recovery of more than a million dollars. False Claims Act * Recent legislation has made it easier and potentially more lucrative for employees to blow the whistle to regulators when companies are government contractors or when the federal government has somehow been defrauded. * Whistleblowers who report corporate wrongdoing against the government to prosecutors can be awarded 15 to 30% of whatever damages the federal government recovers, which are to be three times the damages the government has sustained. * Since the government has recovered billions of dollars since the law’s inception, this has become a powerful incentive for some employees to tell all to prosecutors. Sarbanes-Oxley Act (SOX) * Passed in 2002, this act provides whistleblowers in publicly traded companies with revolutionary new protections if they “make a disclosure to a supervisor, law-enforcement agency, or congressional investigator that could have a ‘material impact’ on the value of a company’s shares.” * Under the law, board committees must set up...
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...Ethics and Compliance David Livingston, Raul Lopez, Robert Morrison, Tyler Norwood FIN/370 Finance for Business University of Phoenix May 7, 2011 Joe Brennan Ethics and Compliance Even though there are federal rules and regulations governing work place behavior, what if there were no boundaries for ethics and compliance, would Amazon continue to follow the same procedures set by the federal laws to ensure ethical behavior within the work place. How does Amazon differ from other organizations when it comes to ethical behavior? One way is because Amazon adheres to a strict conflict of interest policy regarding customers, employees, and Amazon follows strict policies on record keeping and financial integrity. Team C will depict Amazon’s policy and procedures for ethical and SEC compliance, explain the function of monetary markets in the United States, and assess Amazon’s monetary performance for the previous two years by means of financial ratios. Team C will explain Amazon’s financial health in reference to the debt, return of equity, and daily receivable ratios. As part of their code of business conduct and ethics policies, Amazon established basic guiding principles to help steer their employees to do what is ethically and morally right to reassure their investors that they are doing what is right for the investors and the public. Of course Amazon must be in compliance with the governing (a) laws, (b) rules and (c) regulations set forth by local and federal governments...
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...could achieve their goal of providing for stakeholders. The company considered the U.S. Federal Sentencing Guidelines, and Sarbanes-Oxley Act with all of the basic elements included. 4. Can Alcoa's "values in practice" be adopted by other organizations as a universal set of ethical standards leading to ethical employee behavior? Measures that Alcoa implemented were crucial to setting a standard for universal ethical codes and enhanced the ability of each employee to act in an ethical way. Furthermore, by employees complying with polices and procedures set by Alcoa, this created an environment of success for all. Elements of ethics and compliance program include: • Publishing the Guide to Business Conduct and other directional documents; • Deploying global business conduct training and communications to all employees; • Managing the global Ethics and Compliance Line; • Administering the annual Business Conduct and Conflict of Interest Survey Certification that focuses on violations of the business conduct, insider trading, and anti-corruption compliance policies; • Managing investigations of fraud and other significant non-compliances; • Monitoring effectiveness metrics and non-compliance risk assessments; •...
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...Good Governance Case Study Case Study 1 Mini Case: ACCT-05 Business Ethics Program Challenges Encounter: The action made started with the acquisition of additional asset through a loan acquired from a falling competitor. The assets obtained were a problem knowing that all the information about the inventory was nowhere to be found resulting to a sales decline. Without Rick knowing, Russ as a president holds large amount of checks, as a result they had encountered trouble about the reimbursement of the petty cash fund. With regard about the profit, they earn smaller amount than they usually receive because there had been a large markup which exceed its cost eight times. Self-centeredness is the major problem experienced in the given case. As for Russ, the majority stockholder, he told no one about the sales thinking that he could have something in case of bankruptcy or foreclosure. As for the point of view of Rick, the controller of the firm, he kept all the fraud information to himself and he always agreed to what the president says to earn his boss’s trust and also because of the reason that he might lose his job. Outcomes: For Rick’s concern he might as well tell the truth and do what is right without considering only his own sake because consequences are going to be much worse if he do the other way around. If ever they continue to do those frauds they had done, they might end up worn down. They could suffer and lead to bankruptcy. But if the actions they made...
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...Measuring the Effectiveness of Compliance Programs Pradeep Parakh, Mumbai, India Why to have a Compliance Plan • Heightened scrutiny by regulators • Avoid problems before they occur • Improved effectiveness of organization The Importance of Compliance • Compliance provides stability in revenue • Compliance uncovers inadvertent errors which can be corrected before they create huge problems for the entity • Compliance allows continued service to consumers because paybacks and penalties can impact the delivery of future services • Compliance leads to a better relationship with regulators and those who have dealings with the entity Compliance Programs Must Have Substance • As evident by recent legislation, the focus of regulators is shifting from a focus on the presence of a compliance program to evidence that demonstrates the effectiveness of the compliance program • Regulators asks question such as – “Can you prove that your compliance program works?” Elements of Effective Compliance Plan • Written policies and procedures • Compliance Officer • Training and education . . . including . . .governing body members • Communication lines to the Compliance Officer • Disciplinary policies • Internal audits and, as appropriate, external audits • Response and investigation Types of Compliance Programs People Measure • • • • • • • • Security compliance Regulatory compliance Listing compliance Environmental compliance Safety compliance Quality control compliance Privacy compliance...
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...can, to take pride in their work. Starbucks have kept true the statement by creating a culture that mainly focuses on customer satisfaction. Their partners (employees) thrive to improve the customers experience by relating to them and continue to provide excellence in customer satisfaction. The company and its partners constantly seek feedback on how to improve their customers experience in an effort to maintain the company’s standards. A form of internal communication Starbucks has is a program called the “Business Ethics and Compliance “(http://www.starbucks.com/, 2012) which is a program that continuously offers to teach and support the Starbucks Mission and protect their culture and the company’s reputation. This program reinforces the company’s ethics, legal compliance and ethics training to make sure the partners continue to offer their customers the best experience possible when visiting their establishments. A couple of internal communication is the program of Business Ethics and from requesting feedback from their customers shows internal and external communication to keep up with the...
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