Cooperative bank is one of the organizations in the world that operates ethically. It came up with an ethical policy, which covers all aspects of impersonal banking to include; business loans, deposits as well as treasury dealings. This policy has a wide coverage with areas such as human rights, ecological impact, social enterprise, international development and animal welfare. This bank is unique when compared to others in that its ethical policy is customer-led.
The bank is headed by the board of directors at the apex, and then followed by the chief executive officer; who is questionable by the board. Under the chief executive officer are the general managers in respective areas such as; marketing, customer banking, information technology among others. As a result of its effective leadership and management structures, the bank offers, a wide range of products and services to include; mortgages, credit cards, savings, current account and loans.
Sarbanes Oxley Act is important to various stakeholders in a company, since one of the policies in this Act is; the establishment of an independent audit committee that will be responsible for auditing a public company. This is essential since an external audit will provide a more valid result than an internal audit thereby, providing a true and fair view of an organization’s financial position. The Act also promotes transparency between, those operating the firms and the stockholders in that; it proposes that complex transactions in terms of finances be communicated to stockholders. Therefore, I believe that this Act is needed in various companies.
The revised federal sentencing guidelines 2004, are essential to organizational leaders and board of directors, in promoting more ethical behaviors in that; it aims at promoting a firm’s culture that enhances ethical conduct, as well as, commitment towards the adherence to the rules and regulation of a company. The guidelines also recommend that an organization is supposed to follow its program on ethics, while monitoring, as well as, auditing, with the aim of detecting any misconducts.
My opinion is that; the leaders and the management in an organization should request for the certificate of good conduct from their potential employees, before recruiting them. This action will aim at promoting ethics in an organization. On the other hand, those responsible for policy formulation should come up with ethical rules that may attract reasonable fines in case an employee fails to adhere to these stipulated rules. When it comes to the procedures in a company, the management should ensure that the methods for conducting a particular activity is properly documented and communicated to the employees.
Various corporate crises are not so familiar to me. This includes; the one related to a company that sells Dalkon shield to women. The customers to this company eventually suffered from serious gynecological problems after using this product. This resulted to a lawsuit that forced the company to set aside a minimum of $314 million for compensation. This represents a serious breakdown in the company’s system in that, instead of it using its money for its development projects, that money is misused towards compensation, due to their unethical conduct. It is also unethical eventually to find out that, A.H. Robins Company could not recall its product, which in this case was Dalkon shield.
The other crisis is the one that relates to Dow Corning, a corporation that deals with breast implants made of silicone gel. This product had caused serious illnesses to a client; who was awarded $7.3 million, after suing the company. The problem with this company was that, it rushed its products to the market without carrying out any safety tests. As a result, the company continued doing business as usual, especially during the time when the product hit the market. But now, its system will have to be reviewed in an ethical manner, to ensure that its products are safe and suitable for consumption.
These crises as far as John Mansville is concerned; can be managed through setting up a trust fund that could be used to settle any claims. The shareholders had to surrender half of what the company owed them in stock, and their projected earnings were also reduced in order to support this. A settlement trust that dealt with personal injuries, as a result, of the effects of asbestos was also put in place in support of this venture. The best way of avoiding such crises was to; warn the victims before they were affected by the effects of asbestos. In this case, the company would be able to defend itself in a court of law. Since the company was settling the claims using a larger proportion of its revenue, the best where was to declare it bankrupt for it to be insolvency.
Cooperative bank can be termed as the most ethical organization I have ever come across, due to its customer-led policies. This bank operates in a manner that prioritizes the needs of its customers. For instance, its products and services such as loans and mortgages, aim at meeting the needs of its customers. While its current accounts are customer oriented. When it comes to ethical crises, the bank has never been reported to have any misconduct. This means that, it properly practices its ethical policy and thereby focuses on conducting business as usual, with all its systems being run as expected.
The covenantal ethic is not realistic to larger corporations, since such organizations tend to ignore various aspects by avoiding part of their responsibilities. Social contract, on the other hand, is still not applicable in big institutions. This is because, putting in place such an agreement will be hectic, and some clients will end up being dissatisfied than others. The members of the organization may also not be comfortable with their agreement with the corporation, and may therefore not provide quality services as expected of them.
According to the free market theory of corporate social responsibility of the firm to consumer’s states, a customer has a right to choose what to purchase and what not to. The problem with this is that, some firms’ thoughts are not similar to those of their clients as they spend minimal time on research. This view is similar to the social contract in large firms that do not meet the needs of the consumers. And also differs to stakeholder’s corporate social responsibility of meeting the needs of the consumer. Stick approach is suitable for running a corporation as compared to the carrot approach, due to the involvement of legal aspects. The advantage of this is that; the employees with behave in an ethical manner to avoid any penalties. The disadvantage, on the other hand, is that, a company may lose huge sums of money in case of a lawsuit.
It is unethical for someone to download copyrighted music. To avoid this, the musician should put in place restrictive measures. The main stakeholders to napster are the media photographers and graphic artists, just to mention a few. These groups changed after signing an anti-napster copyright agreement. The stakes for napster’s various revolutions was that copyrighting be made illegal to all. Now than napster has been able to reinvent twice in the short run, it means that more companies of a similar kind are expected in the future.
