Despite the factors contributing to the evolution of the business environment, Aristoles politike is still relevant and applicable today. Business ethics in a legal environment have evolved over the years because of the way we do business. As the times change, people and their morals change. When peoples morals change, so do the way they do business. In the past businesses and companies only had to address mediocre unethical acts. Now we have Martha Stewart illegally buying stock tips. Companies ethics are actually a sign of the times. Many attributes contribute to the unethical behavior of many professional and business persons.
These contributions include economic, political and social attributes. They not only plague our country but the world as a whole. In this report, we will discuss three contributing factors that legally affect the business environment and how Aristotles politike show their relevance in todays business world. In addition, we will address the major unethical acts that have impacted two major companies, Enron and Author Anderson. Ones first question, what is Business Ethics? Our text defines it as a branch of applied ethics is the study and determination of what is right and good in business settings.
Many people in the business world are familiar with their companys ethics because it is part of their training when they begin employment. The federal government also has their own set of ethics that they give to each employee upon their entrance on duty. Codes of conduct are also address in many businesses code of ethics. Many of the unethical issues that were dealt with years ago only had to do with social issues like affairs between colleagues. The first major ethical issues that became legal issues were that of Richard Nixons resignation as a result of the Watergate scandal.
The burglary was committed on June 17, 1972, by five men who were caught in the offices of the Democratic National Committee at the Watergate apartment and office complex in Washington, D. C. Their arrest eventually uncovered a White House-sponsored plan of espionage against political opponents and a trail of complicity that led to many of the highest officials in the land, including former U. S. Attorney General John Mitchell, White House Counsel John Dean, White House Chief of Staff H. R. Haldeman, White House Special Assistant on Domestic Affairs John Ehrlichman, and President Nixon himself.
Another past ethical issue was that of Oliver North and President Regan. American political scandal of 1985 and 1986, in which high-ranking members in the administration of President Ronald Reagan arranged for the secret sales of arms to Iran in direct violation of existing United States laws. Profits from the $30 million in arms sales were channeled to the Nicaraguan right-wing contra guerrillas to supply arms for use against the leftist Sandinista government. This, too, was in direct violation of U. S. policy. The chief negotiator of these deals was Lieutenant Colonel Oliver North, a military aide to the National Security Council.
North reported his activities initially to National Security Adviser Robert C. McFarlane, the council’s head, and subsequently to his successor, Vice Admiral John M. Poindexter. The sale of arms to Iran was initiated at the suggestion of the Israeli government with the dual goal of bettering relations with Iran and of obtaining the release of American hostages held in Lebanon by pro-Iranian terrorists. North was instrumental in setting up a covert network for providing support to the contras, with its own ship, airplanes, airfield, and secret bank accounts.
These types of unethical acts and other contributors helped to take unethical and legal issues to another level. As technology advances, the chances of unethical acts also increase. With bank tellers working on a computerized system does not stop him/her from inputting one amount and putting the cash deposit into a crawl space under the drawer. The only thing that stops this teller is the hidden cameras all around. The advancement of computers also allows accountants and executives to open offshore accounts to extort money from their company to use for personal use. Accounting firms have been under the microscope for years.
Generally Accepted Accounting Principles and their flexibility to change them also allow for people to commit unethical and illegal acts. Such is the case of Enron and Author Andersen, which is discussed later. Politics Enron – Enron was born in July 1985 when Houston Natural Gas merged with Omaha-based InterNorth. Kenneth Lay, an energy economist who had held academic and government positions throughout his career, became chairman and chief executive. His ambitions for the new company he had helped form went beyond the business of piping gas. He wanted to see an energy trading revolution and place Enron at the heart of it.
By 2001 he appeared to be successful in his goal, having created a multinational corporation employing thousands with a turnover of billions of dollars. The collapse of energy giant Enron is the largest bankruptcy and one of the most shocking failures in United States corporate history. In just a little over 15 years, Enron grew into one of the USs largest companies. It embraced new technologies, established new methods of trading in energy and seemed to be a shining example of successful corporate America. But the companys success was based on artificially inflated profits, dubious accounting practices and fraud.
One question that was already being asked before Enron crashed was this: how much influence did it have on Capitol Hill? Enron certainly wasn’t the only company lobbying for energy deregulation, but deregulation helped Enron establish the trading markets that became its core business. Directors built relationships with both Democrats and Republicans. Kenneth Lay himself had strong personal ties to two Republican presidents, George Bush Sr. and his son George W Bush. As Enron expanded, there was little scrutiny of how it was managing the expansion. But when it began to unravel, the questions began to pour in.
Arthur Andersen – Arthur Andersen LLP, once the world’s fifth-biggest accounting firm, was ordered to pay the maximum $500,000 fine for obstructing the government’s investigation into the collapse of Enron Corp. Since Andersen’s indictment in March, the 89-year-old firm has dwindled from 85,000 employees worldwide to fewer than 3,000. Andersen’s June 15 felony conviction in federal court in Houston ended the Chicago-based firm’s bid to save its reputation and its ability to audit public companies. Evolution of Business Ethics in todayLegal Environment
Despite the factors contributing to the evolution of the business environment, Aristoles politike is still relevant and applicable today. Business ethics in a legal environment have evolved over the years because of the way we do business. As the times change, people and their morals change. When peoples morals change, so do the way they do business. In the past businesses and companies only had to address mediocre unethical acts. Now we have Martha Stewart illegally buying stock tips. Companies ethics are actually a sign of the times. Many attributes contribute to the unethical behavior of many professional and business persons.
These contributions include economic, political and social attributes. They not only plague our country but the world as a whole. In this report, we will discuss three contributing factors that legally affect the business environment and how Aristotles politike show their relevance in todays business world. In addition, we will address the major unethical acts that have impacted two major companies, Enron and Author Anderson. Ones first question, what is Business Ethics? Our text defines it as a branch of applied ethics is the study and determination of what is right and good in business settings.
Many people in the business world are familiar with their companys ethics because it is part of their training when they begin employment. The federal government also has their own set of ethics that they give to each employee upon their entrance on duty. Codes of conduct are also address in many businesses code of ethics. Many of the unethical issues that were dealt with years ago only had to do with social issues like affairs between colleagues. The first major ethical issues that became legal issues were that of Richard Nixons resignation as a result of the Watergate scandal.
The burglary was committed on June 17, 1972, by five men who were caught in the offices of the Democratic National Committee at the Watergate apartment and office complex in Washington, D. C. Their arrest eventually uncovered a White House-sponsored plan of espionage against political opponents and a trail of complicity that led to many of the highest officials in the land, including former U. S. Attorney General John Mitchell, White House Counsel John Dean, White House Chief of Staff H. R. Haldeman, White House Special Assistant on Domestic Affairs John Ehrlichman, and President Nixon himself.
Another past ethical issue was that of Oliver North and President Regan. American political scandal of 1985 and 1986, in which high-ranking members in the administration of President Ronald Reagan arranged for the secret sales of arms to Iran in direct violation of existing United States laws. Profits from the $30 million in arms sales were channeled to the Nicaraguan right-wing contra guerrillas to supply arms for use against the leftist Sandinista government. This, too, was in direct violation of U. S. policy. The chief negotiator of these deals was Lieutenant Colonel Oliver North, a military aide to the National Security Council.
North reported his activities initially to National Security Adviser Robert C. McFarlane, the council’s head, and subsequently to his successor, Vice Admiral John M. Poindexter. The sale of arms to Iran was initiated at the suggestion of the Israeli government with the dual goal of bettering relations with Iran and of obtaining the release of American hostages held in Lebanon by pro-Iranian terrorists. North was instrumental in setting up a covert network for providing support to the contras, with its own ship, airplanes, airfield, and secret bank accounts.
These types of unethical acts and other contributors helped to take unethical and legal issues to another level. As technology advances, the chances of unethical acts also increase. With bank tellers working on a computerized system does not stop him/her from inputting one amount and putting the cash deposit into a crawl space under the drawer. The only thing that stops this teller is the hidden cameras all around. The advancement of computers also allows accountants and executives to open offshore accounts to extort money from their company to use for personal use.
Accounting firms have been under the microscope for years. Generally Accepted Accounting Principles and their flexibility to change them also allow for people to commit unethical and illegal acts. Such is the case of Enron and Author Andersen, which is discussed later. Politics Enron – Enron was born in July 1985 when Houston Natural Gas merged with Omaha-based InterNorth. Kenneth Lay, an energy economist who had held academic and government positions throughout his career, became chairman and chief executive. His ambitions for the new company he had helped form went beyond the business of piping gas.
He wanted to see an energy trading revolution and place Enron at the heart of it. By 2001 he appeared to be successful in his goal, having created a multinational corporation employing thousands with a turnover of billions of dollars. The collapse of energy giant Enron is the largest bankruptcy and one of the most shocking failures in United States corporate history. In just a little over 15 years, Enron grew into one of the USs largest companies. It embraced new technologies, established new methods of trading in energy and seemed to be a shining example of successful corporate America.
But the companys success was based on artificially inflated profits, dubious accounting practices and fraud. One question that was already being asked before Enron crashed was this: how much influence did it have on Capitol Hill? Enron certainly wasn’t the only company lobbying for energy deregulation, but deregulation helped Enron establish the trading markets that became its core business. Directors built relationships with both Democrats and Republicans. Kenneth Lay himself had strong personal ties to two Republican presidents, George Bush Sr. and his son George W Bush.
As Enron expanded, there was little scrutiny of how it was managing the expansion. But when it began to unravel, the questions began to pour in. Arthur Andersen – Arthur Andersen LLP, once the world’s fifth-biggest accounting firm, was ordered to pay the maximum $500,000 fine for obstructing the government’s investigation into the collapse of Enron Corp. Since Andersen’s indictment in March, the 89-year-old firm has dwindled from 85,000 employees worldwide to fewer than 3,000. Andersen’s June 15 felony conviction in federal court in Houston ended the Chicago-based firm’s bid to save its reputation and its ability to audit public companies.