...(2010) plays the construct of ethical relativism and ethical absolutism a crucial role in understanding the ethical theory. In fact, the central question is if a universal ethical standard exists or not. Supporters of the ethical relativism deny the existence of a global ethical and moral standard. They argue that ethics is depending on social customs, conventions or cultures (McDonald, 2010). Nevertheless,...
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...In defense of non legalization of insider trading in the U.S. I will discuss and analyze the ethical issues. Although shareholders that buy and sell stock in their own companies are doing so legally, I believe the influence to cross the line is too much of a temptation. With illegal insider trading often being difficult to prove and strenous to investigate we should not legalize insider trading. Buying or selling security, in breach of trust and confidence , while in possession of material, non public information about the security is just unethical. Its too much like cheating. The ethical issue here is that using or bribbing to get information before it is publicly disclosed is a decison that lacks integrity. It is dishonest and unfair. Illegal trading is done without respect for investors and stakeholders as they are left with a false picture of the companies financial status in many cases. How would you feel if you paid to enter a contest where you bid how many jelly beans where in a jar to win a prize, only to find out that the person who counted the jelly beans was tipped by your opponent to tell them how many jelly beans where actually in the jar before he bid with you. The person that counted could say they didnt know the jelly beans where being used in a bid, therefore was unaware of the impact of disclosing such information. This is minor compare to the millions at stake in actuall insider trading but the result are often the same. Judges are left to prove illegal trading...
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...Barkoulas INTRODUCTION Bloom's taxonomy (1956) has guided pedagogical structure and innovation for half a century in the United States, and its focus on developmental learning remains relevant and instructive for us. The six developmental levels (knowledge, understanding, application, analysis, synthesis, and evaluation) separate basic knowledge acquisition from the critical thinking and analytical skills necessary for making ethical decisions or judgments. Answering questions about business ethics requires knowledge from multiple disciplines, including philosophy, psychology, political science, sociology, economics, finance, organizational management, and law. Analyzing such a vast body of data in ethical frameworks requires the highest levels (analysis, synthesis, and evaluation) of critical thinking as expressed in the taxonomy. Corporate governance, an interdisciplinary subject addressed in all these disciplines, explores the inter- workings of both for-profit firms and not-forprofit firms and is an area requiring business students to evaluate ethical issues when making decisions. Despite the broad responsibility of teaching corporate governance in the finance classroom, the pedagogy of finance has been restricted to ideas derived primarily from economics, statistics, and finance. Competing ideas from other disciplines are generally unwelcome and/or are treated with skepticism. Even the ideas of some researchers from the fields of economics and finance such as Hart (1995)...
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...boxes THINK THEORY 1 Think of the duties of managers to their shareholders from the perspective of ethics of duty (Kant’s theory). Apply this theoretical lens to the three incidents described above. In each case, management in the three incidents failed to respect the ethics of duty. Kant’s Maxim 1 is about an action being right only if everyone could follow the same underlying principle (the ‘golden rule’). For example, Ahold management concealed the true state of affairs from the company’s owners (and everyone else), action which they cannot have wanted to become a universal law. Maxim 2 requires human dignity to be respected, with people being treated as ends, not means. For example, management at Porsche treated the company owners instrumentally, not respecting their dignity, essentially treating them as ‘finance-providing ends’. Maxim 3 is about universality; whether the principles of an action would be acceptable for every person. The fact that 90% of shareholders voted against Goodwin’s pension is clear evidence that this was not the case at RBS. THINK THEORY 2 Thinking of different corporate governance practices around the world, are these just ‘different’ (i.e. reflecting different cultural and customary practices) or would you argue that some of them are clearly more or less ethical from a moral perspective? One could perhaps argue that some governance models are more ethical than others. For example, the continental European model focuses more on employees as...
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...Traditionally, the basis of utilitarianism is to do what will result in the greatest good for the most amount of people. However, in the article I read; Analyzing Insider Trading from the Perspectives of Utilitarian Ethics and Rights Theory written by Robert McGee, McGee described that as a bit of an outdated perspective. He instead gave a description of what he sees as the “modern utilitarian position”, where in order for something to be considered ethical, the gains would simply need to exceed the losses. He uses both of these definitions of utilitarianism to weigh the ethical correctness of insider trading and to address the common arguments against such practices from a utilitarian standpoint. The most obvious strength of this approach is that it serves to benefit the most amount of people. In his article, McGee emphasizes that efficiency is not a substitute for ethics, which I see as paralleling utilitarianism and is another aspect that makes it such a rational approach. This ensures that even though there may be a way to do something better/faster, if it doesn’t result in a positive outcome for the most amount of people, it isn’t the right thing to do. Using the example given in the article, although insider trading may increase efficiency for a single company, the hit that competing companies would most likely take as a result would eliminate any benefit to the larger population. The strengths of such an approach are ideal, seeing as regardless of all else, they would...
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...Professional Responsibility Mulligan versus Friedman perspectives on moral business decisions * Mulligan: Execs have most knowledge and will be better at at analyzing problems and implementing solutions * Friedman: Execs are not competent to solve moral problems – should be left to governemtn Director/Officer “Duty of Due Care Standard” in the Business Judgment Rule Statutory duty to act: 1. “In Good Faith” – NO SELF INTEREST 2. “With Care of an ordinarly prudent person” BE INFORMED 3. “In manner reasonably believed to be in best interest of corporation” Comparison to a Professional’s “Duty of Due Care”: 1. Duty of Care 2. Breach of duty of care by a reasonably prudent professional 3. breach causes damages that were foreseeable. 4. Negligence Theory: , Can negligence be criminal—US v Parks case Yes! If informed of an issue, should follow through and ensure action was taken (supermarket example) States’ Differing Public Policy on role of stakeholders in making a decision that is in the best interests of the company * Half of the states say the officers and directors can take into account stockholders and other stakeholders (employees, customers, supplies, communities). * Pennsylvania and Indiana allow officers to place the interests of stakeholders above stockholders Why most companies choose Delaware to incorporate Management friendly. Example: business judgement rule Drucker’s Aristotelian...
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...investment broker. This relationship soon went past initial flirting, to where both parties became complicit in sharing of nonpublic information (insider trading). Soon after, Donna Murdoch, began to tip off more investors, such as Richard Branson, who she also meet on Ashley Madison and became her “go to” source of income to play these trades. All of these transactions began to catch the attention of SEC, who were tipped off based on the volume of option contracts, which in some cases Mrs. Murdoch was the sole buyer of. This attention by the SEC soon led to a full blown investigation, which exposed the relationship between Murdoch and Gansman. This relationship when exposed led to charges and convictions for both Gansman and Murdoch; however it put more of a spotlight on Ashley Madison, and made some question the ethics of a company like Ashley Madison. However, when the founder and his wife discuss how they feel about it ethically, they see it as a legitimate business within the confines of the law. Although this remains an unresolved debate that rages on today on whether a business basing itself on “unethical behavior “is in fact ethical. Analysis of the case The case was unique in a way as it made us realize that unethical behavior in a business sense can be related back to unethical behavior in a social sense. For example, insider trading is considered to be more of legal crime/business crime than a social crime and when found out upon is punished by a legal system...
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...The SEC addresses both legal and illegal insider trading applicable, but not limited, to corporate executives, directors, employees, friends and family of insiders, people who are privy to information as a result of working for a firm that has inside information due to interaction with the corporation (SEC, n.d.). The SEC governs securities, but the same guidelines can be applied to other forms of monetary investment or gambling where one party has knowledge that unfairly provides an opportunity to make a more informed decision than other participants. Insider Trading Limits and Pete Rose The Pete Rose case is an example of illegal betting with inside information. Pete Rose should refrain from betting on the success of his team because he has information about the players, opponents, and game plan that other betting parties do not. Further, there could be arrangements made with the other team to play differently and receive monetary compensation, compromising trust and integrity of the sport (Klosterman, 2014). Punishments should be more severe for betting on a loss since the ability to create the loss by intentional poor performance, for...
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...The SEC addresses both legal and illegal insider trading applicable, but not limited, to corporate executives, directors, employees, friends and family of insiders, people who are privy to information as a result of working for a firm that has inside information due to interaction with the corporation (SEC, n.d.). The SEC governs securities, but the same guidelines can be applied to other forms of monetary investment or gambling where one party has knowledge that unfairly provides an opportunity to make a more informed decision than other participants. Insider Trading Limits and Pete Rose The Pete Rose case is an example of illegal betting with inside information. Pete Rose should not be allowed to profit from betting on the success of his team because he has information about the players, opponents, and game plan that other betting parties do not. Further, there could be arrangements made with the other team to play differently and receive monetary compensation, compromising trust and integrity of the sport (Klosterman, 2014). Punishments should be more severe for betting on a loss since the ability to create the loss by poor performance, for example, is easier. Even with required disclosure and laws in place to deter insider gambling and...
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...Appropriation: An Ethical Assessment of Cultural Appropriation in Fine Art Gabriela Amaya-Baron Ethics and Visual Representation Diane Zeeuw 09/2012 Cultural appropriation is a concept that seems to carry with it a negative connotation. I think this is understandable since the practice often involves the recognition of certain societal divides, which can be highly sensitive and political. This can make people uncomfortable, and in the context of the arts, it has been known to cause offense. This sensitivity has been used as a superficial counter against cultural appropriation, especially by those who feel their culture is the one being appropriated from. It is an easy argument to apply against artists who appropriate. It makes for a simple stance when an offended party stages a public outcry, helping them to gain traction and visibility in the landscape containing the politics of culture. The case for cultural appropriation in fine art, or at least the one against the censorship of it, takes more effort and time to present because it does not crux on the emotions of those attempting to make an ethical judgment call. It appears that the offense argument has been so convincing as the main reason not to engage in cultural appropriation because it simply feels as though it’s right. If we were to place ourselves in the offended party’s shoes, we might say, “Well, it’s possible we wouldn’t appreciate that sort of act either.” However, if someone wants to make an ethical case against...
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...the public, and failed to exercise proper oversight or shoulder responsibility for ethical failings. They allowed themselves to be motivated much more by what would benefit themselves than what would truly benefit the company. Money, greed, arrogance and hubris led company executives to lose focus on working for the good of the company and to act unethically (Gini,2004). Abuse of power to make decisions which were beneficial economically and politically to themselves and the company, was one of the key factors that led to Enron’s failure. Company leaders used insider information and traded millions of dollars in company stock, borrowed from subsidiaries with no intent to repay the loans (Wilke, 2002) , and avoiding federal taxes even though some of its subsidiaries, like Portland General Electric, collected tax payment from customers (Manning & Hll, 2002). Such behaviors of moral failure at the top and irresponsible behaviors led to the collapse of Enron. The unethical behavior of Enron’s leaders appears to be the product of both individual and situational factors. Greed was the primary motivator of both managers and their subordinates at Enron (Cruver, 2002). Optimistic earnings reports, hidden losses and other tactics were all designed to keep the stock price artificially high. Lofty stock values justified generous salaries and perks, deflected unwanted scrutiny, and allowed insiders to profit from their stock options. Greed was not limited to top Enron executives,...
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...SEMESTER 2 2011 CPA 118 ETHICS AND GOVERNANCE CPA - ETHNIC SEMESTER 2 2011 MODULE 1 ACCOUNTING AND SOCIETY 1.05 1.05 Part A: Ineraction with society Depictions of A/cting Depiction Defeating depictions defeat Fig 1.1 new bean counter How to become professional? 3 aspects 1.06 Recruiting the best Beard(1994),Smith and Briggs(1999) and Simnik and Felton(2006) Friedman& Lyne(2001);Albrecht and Sack(2000);Coate et al.(2003) Jeacle: colourful accountant linked to corporate collapses 1.07 Moral agency Biddle(2006) Value creation - key to maintain high standards Moral agent - refer to individual making moral judgement for others Moral agent theory based on concept " act appropriotely and professionally" 1.08 Technical functions and social impact Understanding A/cting A/cting defination - Macquarie Dictionary - Technical practice - bookkeeping Not Prefect def - AAA(American A/cting Association) -communication skill… 1.09 Social impact of A/cting + impact - based on historic A/cting info professional capabilities - technical knowledge,soft skill & experience 1.10 Social impact example - A/cting and the GFC "mark-to market" Lonergan (2009) - if A/cting causative factor in GFC 2008/2009 1.11 Q 1.1 Logergan 'standard setters'slow reaction only cause GFC ? NO How wisdom come out? - experience /knowledge Distinguishing feature - building relevant wisdom over time Parker et al. (1989) - induce other behaviour Miller(1994) - intrinsically and inredeemable social impact IMPACT Macro level:...
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...TRADING STOCKS Stock trading has become one of the most popular and efficient ways to make money since it is easy to access and it could bring a lot of money back to investors. With some extra money, anyone can purchase stocks from a company or corporation and make profit. A stock is basically a type of security that signifies ownership in a corporation and represents a claim on part of the corporation’s assets and earnings. There are two main types of stock: common and preferred. Common stock usually entitles the owner to vote at shareholders' meetings and to receive dividends. Preferred stock generally does not have voting rights, but has a higher claim on assets and earnings than the common shares. Owning a stock means that a stockholder (person that owns the stock) has a claim to a part of the corporation’s assets and earnings. We could say that shareholders are owners of a corporation. Ownership is determined by the number of shares a person owns relative to the number of outstanding shares. The higher number of stocks a person owns, the more benefit he/she will get. People that purchase stocks would have the following advantages and disadvantages: Advantages: -They would be able to gain a large amount of money -The potential loss from stock purchases with cash is limited to the amount of the initial investment. -Stocks offer limited legal liability -Most stocks are very liquid (they can be bought and sold quickly at a fair price) -Investment diversification (purchasing...
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...SEMESTER 2 2011 CPA 118 ETHICS AND GOVERNANCE MODULE 1 ACCOUNTING AND SOCIETY 1.05 1.05 Part A: Ineraction with society Depictions of A/cting Depiction=描述 Defeating depictions defeat =挫败 Fig 1.1 new bean counter How to become professional? 3 aspects 1.06 Recruiting the best Beard(1994),Smith and Briggs(1999) and Simnik and Felton(2006) Friedman& Lyne(2001);Albrecht and Sack(2000);Coate et al.(2003) Jeacle: colourful accountant linked to corporate collapses 1.07 Moral agency Biddle(2006) Value creation - key to maintain high standards Moral agent - refer to individual making moral judgement for others Moral agent theory based on concept " act appropriotely and professionally" 1.08 Technical functions and social impact Understanding A/cting A/cting defination - Macquarie Dictionary - Technical practice - bookkeeping Not Prefect def - AAA(American A/cting Association) -communication skill… 1.09 Social impact of A/cting + impact - based on historic A/cting info professional capabilities - technical knowledge,soft skill & experience 1.10 Social impact example - A/cting and the GFC "mark-to market" Lonergan (2009) - if A/cting causative factor in GFC 2008/2009 1.11 Q 1.1 Logergan 'standard setters'slow reaction only cause GFC ? NO How wisdom come out? - experience /knowledge Distinguishing feature - building relevant wisdom over time Parker et al. (1989) - induce other behaviour Miller(1994) - intrinsically and inredeemable social impact IMPACT Macro level: all types of business...
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...Ethics Benton Scott MGT/498 July 3, 2013 Melanny Felton Ethics Ethics refers to the fundamental principles of an individual or a group, where social responsibility is how business performs its activities to meet a wider obligation toward society and environment. Strategic planning is an essential step in the corporate world were senior management defines the organization’s direction, and decision making. “Ethical values and social responsibility serves an important role in the strategic planning process”(Abdullah p. 1, 2013). Stakeholders Management must consider the impact on stakeholders when considering any strategic decision making: stakeholders are anyone who is affected by the activity of the business, such as suppliers, and customers. Any social responsible organization treats their stakeholders equally, and a wider perspective also has to be considered in terms of environmental and social impact of planned activities. Management should provide information that is both transparent and honest to help everyone involved to discuss, and debate to reach better decision- making, and by accomplishing this it allows then to identify and monitor potential risks which may arise and find alternative solutions. Transparency enhances the organization credibility towards their external stakeholders. Management meeting provides the opportunities for teams to raise concerns and come up with some new ideas, and should be conducted in a professional comprehensible manner...
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