The ethical implications of the scenario, how to solve them and the necessary ethical theories of the same
The implications of this scenario have a significant impact as it tends to undermine the social compact the Company has with its stockholders, the consumers and the entire society. Though the CEO promises a salary increment, agreeing to the request of the company CEO goes against the conduct of ethics and social responsibility that requires a company to do the right thing and avoid illegal actions to make more money (Guthrie, 2012). From the perspective of social ethics, the action is highly unethical and does not embody the virtues of honesty, morals, and reputation. Furthermore, it fails to uphold the aspect of the company loyalty and Ethical Leadership in Financial Services.
The action of not writing down the stock in the year end accounts is in the CEO best interest. Thus, it goes against the utilitarian ethical theory that proposes that the action that produces the greatest positive impact to most people is ethically correct. Fundamentally, the action contravenes the deontological ethical theory that obliges one to adhere to their duties and obligations when making ethical decisions (Vogel, 1991). Thus, writing down the stock in the year end accounts is the most consistent decision since it is based on the adherence to the set duties and responsibilities.
Learning Activity No 2
What I think of the debate, my corporate actions’ personal experiences on the effects of this debate, and the side of argument that come down on and why
Corporate social responsibility is a concept that dominates major debates in the current business society. The debate is concerned with some social contract between the company’s interests and the society. While the company has the mandate to maintain the interests of the company first by maximizing profits, it also has an obligation to be socially responsible in the local society where it operates or resides (Samuelson & Birchard, n.d). Since the company operates in a civil society, it is part of the society and has an obligation towards the members of the society. Thus, by donating cereal products to homeless shelters, and to the Red Cross for distribution to areas where needed, it integrates the social concerns in its operation.
Though some stakeholders would like to uphold Friedman view that corporation only obligation is to operate within legal guidelines and make profits for its shareholders, this conduct goes against the business ethics. Thus, the fact that their conduct is legal does not mean that it is morally right. It is understandable that the shareholders would not be unwilling to tolerate the company activities that are non-profitable and which tend to reduce their dividends or market performance of the stock. However, the company has more obligations beyond legal compliance. Besides, the broad meaning of stakeholder does not comprise of the financiers, employees, suppliers, and customers only. It encompasses the local community where the business operates (Phillips & Bio, 2015).
References
Guthrie, D. (2012, January 31). Paying more than lip service to business ethics. Forbes. Retrieved from http://www.forbes.com/sites/dougguthrie/2012/01/31/paying-more-than-lip-service-to-business-ethics/#165d7186750c
Phillips, R., & Bio, V. (2015). Some key questions about stakeholder theory. Retrieved June 4, 2016, from http://iveybusinessjournal.com/publication/some-key-questions-about-stakeholder-theory/
Samuelson, J., & Birchard, B. (n. d). Knowledge review. Retrieved June 4, 2016, from http://www.strategy-business.com/media/file/03311.pdf
Vogel, D. (1991). The ethical roots of business ethics. Business Ethics Quarterly, 1(1), 101
