See document Essay Example | Topics and Well Written Essays - 3000 words

See document - Essay Example Company senior managers heading public companies prepared deceptive statements to blow up the prices of the company stock, apparently undermining the trust of the public in the integrity of financial market and regulators. The corporate scandals are usually perpetrated by several people who understand the organization’s every single detail, with most collaborating parties being people with high standing in the society. Most executives in failed corporations admit receiving enormous bonuses and backdated stock options to warrant that they will make wealth from investing in their company; not considering whether their performance made the share price increase or go down. Other unethical behaviors have resulted in the downfall of corporations, poor performance and negative publicity. As a result, the aspect of ethics in organizations has increasingly gained prominence due to distrust on organizational leaders (Loe, Ferrell & Mansfield, 2000) This study seeks to examine some of th e corporate failures, reasons behind their fall, as well as a close examination as to where blame may be assigned. Of specific importance, Enron downfall and Satyam scandals will be useful in examining ethics behind corporations’ failure. The paper will also look at the theories that expound on the subject of ethical governance in organizations. Ethics is a significant pillar in the modern corporate arena and corporate governance. Organizations have learnt useful lessons from the above cases on the danger that unethical decisions can bring in any organizations. As David Thoreau once said, â€Å"it is truthfully sufficiently said that a firm has no conscience; but a company of conscientious men is a corporation with ethics†. This statement carries a lot of meaning with it as to the significance of upholding ethics in organizations. The subject of what constitutes ethical behavior in organizations remains a debatable subject due to the wide ranging opinions of what const itutes ethics, and what ethics is not. Nevertheless, many organizations have embraced ethical codes stating their leading philosophical guidelines and organizational values. Ethical codes that are successful highlight the obligations of organizations to shareholders, the behavior anticipated of employees, and ethical parameters of the organization. Ethical codes are intended to impact on employee behavior, and are also referred to as corporate ethics statements. Business ethics field deals with questions as to whether a particular business practices are acceptable. Controversial business ethics issues arise on a daily basis in every organization, and this calls for organizational members to exercise their conscience as Thoreau said. For illustration, an accountant may face an ethical dilemma in his/her course of duty that may compromise her decision. For instance, if an accountant discovers inaccuracies in a client’s auditing report, he/she may opt to report the inaccuracy. O n the other hand, reporting such an inadequacy may result in the auditing company fired by the client for disclosing the inadequacies. This confusion leaves the accountant at crossroads as to what practice is acceptable. Business ethics require that organizational members to conform to sound moral principles. Special consideration has to be put into perspective when applying the concept of ethics in business. One is that businesses are formed with the aim of making a profit, and therefore, businesses