Corporate Ethics: The barrel is rotten not the apples

Unethical corporate behavior does not begin and end at the executive level. All employees of businesses are capable of making unethical business choices. Most recently, studies have been conducted to examine how this behavior can be eradicated from the corporate structure. This week, I entered the blogosphere once again and found two blogs that discuss current dilemmas concerning the integration of ethics into corporations. In the blog "Governance Focus," author Onesimo Alvarez-Moro, a 20-year veteran of international investment banking, stresses the need for universities to incorporate ethics training not only as an introduction course in his post "Teaching Business Ethics: A critical need." The second blog I commented on is by Leon Gettier, a senior journalist at the Australian business journal The Age. His blog, "SOX First" focuses on the Sarbanes-Oxley Act and its integration into businesses. More specifically in his post, "Ethics Watch," Gettier comments on the great corporate illusion of ethical codes.

Comment:

Thank you for bringing this issue to light. Teaching "ethics and responsible behavior" is crucial to equipping students as they graduate and move into the business world. However, I believe ethics is more than just a class or a curriculum. Ethics is a habit and a way of life. Most people are able to recognize what is right and wrong in life. Yet making ethical decisions is often complicated when employees are challenged with pressure from executives, confronted with added monetary bonuses for covering up issues, or burdened with peer pressure. The Institute for Corporate Ethics, comprised of CEO's from top Fortune 500 companies, has generated a report, urging university business schools to develop ethical leadership classes and divisions, emphasizing ethics as a core discipline of business. "The best metric for assessing the worth of business schools is whether or not we are preparing emerging leaders to be good creators and stewards of value." The University of Southern California is at the forefront of student awareness on ethical education. The performing arts center adapted a new play "The Voysey Inheritance," a retelling of Victorian business ethics that "rings with echoes of modern-day corporate excess." Let's hope other universities can follow this trend and maybe take it to the classsroom soon.

Comment:

First of all, I want to applaud your blog and your most recent post. I would like to expand on some of the issues you address concerning enforcement of codes of ethics. The CFO's Europe Research study that you name says that because America has criminal penalties involved with unethical practices, "American companies seem to have in place more ethical laws." However, ethical laws are not the issue. The federal government has the Sarbanes-Oxley, Whistle blowing acts, the Ethics Commissions, and the FBI. CFO's "are the keepers of the corporate conscience," however ethics need to come from the ground up in an organization. Enron, WorldCom-they have the codes merely to serve as smoke and mirrors. What corporate America needs is a movement for restructuring the business pyramid, starting with educating employees on the importance of ethics from the onset of employment. BusinessWeek columnist Vivek Wadhwa argues "'company leaders' reinforce corporate values by making these an integral part of how success is measured and rewarded. Performance reviews and bonuses tied to corporate goals can be very effective." The issue does lie in the barrel, not the apples. Corporations need reform from the ground up.

The American Government: A fair and just business

The Forefathers had the idea to create a fair and just government, reflecting the feelings and sentiments of the majority of the people. However, over time this ideal has become warped. Through profit motivation and greed innately present in human nature, the ideals of "fair and just" have not fully materialized. Recently, some actions of the government have reflected more like those of a business. This week I have entered the blogosphere to find some other relevant opinions on the ideas of government and business. I commented on two blogs, which referred to different news topics but which I related to a broader common theme: the American government often operates as an unethical business. Both blogs received high authority ratings from Technorati and also follow the IMSA criteria evaluation standards for blogs. Author Edward Morrissey, a conservative Minnesota radio host of a respected talk show, writes a stimulating post titled "Celebrity endorsements, Political Contributions, and Hsu" on his blog Captain's Quarters. Through this post, Morrissey explores how Democratic Presidential candidate Hillary Clinton (pictured above) used money from an unethical source in order to fund her political campaign. I also responded to a second post, titled "Feds Target Blackwater in Weapons Probe," from another conservative blog Texas Fred. I argue with this author in his post, where he comments on Blackwater USA (soldiers pictured with Blackwater weapons above), a United States military weapons contractor who is allegedly being investigated for illegally smuggling weapons into Iraq.

"Celebrity endorsements, Political Contributions, and Hsu"
Comment to Captain's Quarters:

Firstly, I find your post extremely thought provoking. Although you say that you believe Clinton must have known about Hsu's past, I believe that her knowledge of Hsu's illegal scam is practically irrelevant. Even if she did not know, it shows she did not care enough to deeply investigate Hsu, who was one of her biggest fundraising contributors. Her motivation was to get the money for her campaign; the work and time to look deeper into Hsu's background was clouded by the necessity to get campaign funding. I think it is really important to see that getting the people's votes in America has become a business, teeming with unethical interactions. Pretend for a moment that Hsu did not fraud $23 million from investors and did not have a shady past, Hsu was in charge of getting money for Clinton from investor groups for her campaign. For decades and possibly centuries, candidates have been garnering money from politically charged factions that later require some sort of favor. The accepted American system of electing members of government is not conducive to a just and fair way of governing.
As you stated, Hsu had celebrity endorsements: "Tobey Maguire got caught up in the spider web as well. Stephen Spielberg's close encounters with Hsu convinced investors that Hsu was on the level." These celebrities, who have general public support and are respected figures helped Hsu raise money. They too did not really have an idea who they were helping. However, when it comes to politics, it is obvious that getting elected has become a business. The candidate hires a "professional" like Hsu, they "find" money in order to make their product sell, even if the product could be our next just and honorable president.

"Feds Target Blackwater in Weapons Probe"
Comment to Texas Fred:

I agree with your support of the troops and your strong nationalism toward our government. However, I believe when profit is at stake, people will follow unethical and unjust means in order to accomplish their ends. That is why in this case, the United States Attorney General needs to conduct a deep probe into Blackwater USA. Looking at Blackwater's history, it does not provide a clean slate on which to evaluate them. I am looking at this situation from an business viewpoint, and when a contracted government company is perhaps violating ethical standards, a huge red flag needs to be waved. I am skeptical of Blackwater in general, who the Associated Press in an article titled "'Cowboy' Aggression Works for Blackwater" outlines its in depth involvement with the Republican party. The article says, and I believe you also say, that Blackwater has one task: to protect state department diplomats. As part of their contract, they do abide by this principle. However, does our country want such an organization that compromises ethical behavior in order to not only protect lives but also make money at doing so? Putting aside their recent media storm, at the beginning of last year, two former Blackwater employees pled guilty possessing stolen firearms. The firm is also entangled in GOP fundraising campaigns, giving more than $200, 000, which according to the AP article has allowed Blackwater to operate in a "murky legal world" during the Republican reign.
By using Blackwater, the government becomes twisted into their transactions. Hopefully this issue can be resolved as justly as possible, and the government will let the situation unfold and hold Blackwater accountable as the legal system outlines.