Corporate ethics: Responsibility
A couple of weeks ago, I've watched a movie called "Spider-man?with my family. Displaying a lot of special effects along with high-tech computer graphics, this movie was very exciting and entertaining. In addition to the thrilling action and amusement, there was a quote from the movie that made it even more interesting. "With great strength comes great responsibility? This quote is true for any society that has a hierarchy of power: especially in the world of business. The top executives, who possess great power and wealth, have great responsibility in each deed that they make. They represent the business world of America and must set high and clear expectations of conduct. However, a few of the leaders in business have not performed their duty and full responsibility. There were CEOs earning tens of millions of dollars in by stock options just before their companies went bankrupt, leaving workers and investors to suffer. Responsible CEOs do not compromise to greed by unethical means. What would have happened if Spider-man wasn't committed and didn't take responsibility? What would have happened if he used his great strength for personal gains? Would anybody be safe? What would happen to the economy and society when there is no co
WorldCom, the 2nd largest telecommunications company, filed for bankruptcy-the biggest corporate insolvency in US history. With $30 billion in debt and with $107 billion in assets, the company had to request Chapter 11 protection in federal bankruptcy court. This huge desperation and collapse of the corporation originated from the mismanagement of the former WorldCom CFO (chief financial officer), Scott Sullivan. Anderson, a notorious auditor, has attacked Sullivan for withholding crucial information and a $3.8 billion accounting fraud. The former CFO never consulted nor reported any cost transfers regarding the accountancy. Now the US financial watchdog, the SEC (Securities and Exchange Commission) has charged the telecommunications corporations with fraud. Management lapses in the world of business can bring serious damage to the economy. In recent years, stock options have exacerbated the damage to the workers and shareholders money. As opposed to stocks, stock options can make a profit of almost 300%. When the top executives such as the CEOs or CFOs are rewarded with stock options, their wages can skyrocket. They also would have an advantage obtaining the benefits of leverage over a position stocks reflecting the market. At the same time, they can take advantage of predetermined, limited risk. Executives who can make decisions about the company's future have a real incentive to make the stock price more volatile. An option typically allows the executive to buy stock at a price fixed today for 10 years into the future. Huge grants make this temptation hard to resist, even through unethical means. More modest grants to executives would help them focus on their duty and responsibility than short-term earnings. Although a lot of companies do offer stock options to the top executives, not many offer options to the employees. Even if all the companies do offer stock options to employees, top executives, who are a
Some common words found in the essay are:
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Approximate Word count = 1298
Approximate Pages = 5 (250 words per page double spaced)
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