Ashford University
We Need Regulation: Adolf Berle and Gardiner Means offered three reasons that financial managers cannot be trusted to act ethically in how they present themselves and their financial books. First, exploitation of workers is evident in any corporation with its purposes to keep costs low and to raise profits. Second, they reap much profit from the company for self-interest in large bonuses and dividends. Third, a self-serving behavior and improper procedures of the corporation’s accountants and auditors are being practiced.
The Marketplace Can Decide: Henry Manne, a free market supporter, argued that companies could not hide falsehoods in a lengthy period without being found out. Public deception is the result of rotten self-interested behavior, gained profit from deception will vanish in the end. Fraud accounting procedures bound to be discovered, and Manne presented two reasons. First, deceptive reporting is expensive to businesses and shareholders, and guilt would result to long-term lawsuits from afflicted investors and possible closure of the firm. Second, with opposing interests between the managers and shareholders, share price is driven down, as share price falls, self-serving managers would open their firm for mergers.
In view to governmental applications particularly in the Congress and the Senate, it is clearly associated with its theoretical perspective. Several ways wherein some members of Congress used their power and influenced to benefit financially, their personal capacity from the information they encountered daily. There are individuals from different sides of political and ideological continuum reported that members of Congress usually used their privilege knowledge to obtain large rewards in financial markets for personal gain. These facts demonstrate that some members of the Congress ethical behavior fit in the theory and the three reasons Berle and Means presented.
Personally, I would say that the best theory that fits my ethical perspective is Manne’s. I cannot afford to deceive people for my own interest, and I am afraid to lose my reputation, and the trust of other people above all.
Reference
Fieser, J., & Moseley, A. (2012). Introduction To Business Ethics. San Diego, California:
Bridgepoint, Education, Inc.
Hofstra University School Of Law. (2014). We The People Or We The Legislature?: The Stock
Act’s Compromise Between Politically-Motivated Accountability And Keeping Congress Above The Law . Hofstra Law Review , 267-301.
