Business Ethics: Adelphia Scandal

In this case study we were asked to draw upon deontological ethics, and briefly discuss how Adelphia Communications’ executives violated the trust of the company’s shareholders and the trust of that of the larger public. Throughout this paper I will highlight two key ethical problems that were raised by the Adelphia Communications case. Utilizing Immanuel Kant’s Categorical Imperative, “deontological ethics” or so duty rights will be shared. Then I will apply the deontological framework of business ethics to the two key ethical problems that will be identified. Finally Kant’s Categorical Imperative will be applied to those two ethical problems as well.

It's difficult not to be cynical about how “big business” treats the subject of ethics in today's world. In many corporations, where the

It's difficult not to be cynical about how “big business” treats the subject of ethics in today's world. In many corporations, where the

Overall, deontology is based upon not just by following universal rules or performing what is ought to do, but by respecting human beings as rational beings as well. Deontology judges the ethical motive of an action not by its consequences, merely by the reasoning behind it.

The second ethical problem in this case relates to the Rigas family’s use of publicly-held corporate funds as a personal “piggy bank.” The Rigases used the company jet for personal reasons “without approval of the Board of Directors”, on one occasion flying to Africa for a safari (Markon & Frank, 2002). On another, one of John Rigas’ sons used a corporate jet to pick up an actress friend of his (Grant, Young, & Nuzum, 2004). The former CFO claimed that Adelphia’s funds were used by one of Rigas’ sons to buy a condominium, and to build a $13M golf course (Grant, Young, & Nuzum,

Before explaining why deontology is the best option for the accounting profession, the definitions of each ethics systems must be explained in detail. First, deontology only takes into consideration the issues of fairness, rights, and commitments (Duska, 2011). This system focuses solely on what is right and wrong no matter what the consequences are for self or others. In other words, a deontologist focuses not on the results of the action, but the action itself (Uyar, et.al., 2015). Deontologists believe that moral decisions are based on their obligations and duties. They believe that right is always right and wrong is always wrong, regardless of the outcome.

Enron’s ride is quite a phenomenon: from a regional gas pipeline trader to the largest energy trader in the world, and then back down the hill into bankruptcy and disgrace. As a matter of fact, it took Enron 16 years to go from about $10 billion of assets to $65 billion of assets, and 24 days to go bankruptcy. Enron is also one of the most celebrated business ethics cases in the century. There are so many things that went wrong within the organization, from all personal (prescriptive and psychological approaches), managerial (group norms, reward system, etc.), and organizational (world-class culture) perspectives. This paper will focus on the business ethics issues at Enron that were raised from the documentation Enron: The Smartest Guys

Deontological ethics are based on moral obligations, duties and rights. Rules are to guide decision making in deontological ethics. Deontological ethics have a more individualistic focus, as individuals are supposed to be treated with respect and dignity (Sexty, 2011, 7).

The purpose of this paper is to discuss how Adelphia Communications’ leadership, particularly the Rigas family, violated the trust of the public and its investors through unethical and illegal business practices. First, a synopsis of the Adelphia scandal will be presented. Next, a brief overview of ethics and how they apply to maintaining good business and public trust will be discussed. Following the ethics overview, an outline of deontology and Kant’s Categorical Imperative will be covered. Finally, the business practices and ethical issues with the Adelphia scandal will be analyzed using the deontological framework and Kant’s Categorical Imperative.

This paper relies on secondary data on a past phenomenon. It combines data from journal and other internet sources to bring out aspects of unethical behavior by Adelphia's top executive. The analysis of data takes two ethical frameworks.

Ethical issues have greatly transformed in our lives since the great Enron, Xerox and other huge corporations proposed big profits showing earnings of billions of dollars and yet in reality facing bankruptcy. These corporations faced great trouble with the federals and state for manipulating financial statements. But not only corporations can be blamed on this, accounting firms were involved in this as much as the corporations were. With the business stand point, ethics comprises of principles and standards that guide behavior. Investors, traders, customers, and legal system determine whether a specific action is ethical or unethical. Ethical issue is a vast subject, but we will look at the niche

According to Milton Friedman, "stockholders are the owners of the corporation, and hence corporate profits belong to the stockholders. Managers…have a moral obligation to manage the firm in the interest of the stockholders" (Friedman 45). Adelphia was managed in such a way that it was not in the stockholder's interest, in fact, it was only managed in the interest of the Rigas family. It is wrong to harm the stockholders because they have entrusted the company with their money with an expected return and maybe an

Proponents of deontological ethics do not consider consequences as important when determining whether an individual is moral or immoral. Morality is based solely on the person’s action. Several ethical theories are deontological theories.

Every organization also has a profession responsibility to conduct business honestly and ethically. Our readings reported, “Experts estimated that U.S. companies lose about $600 billion a year from unethical and criminal behavior” Kinicki and Kreitner (2009). The organization could avoid having ethical issues by meeting the

Ethical Lessons Learned from Corporate Scandals Ethics is about behavior and in the face of dilemma; it is about doing the right thing. Ideally, managerial leaders and their people will act ethically as a result of their internalized virtuous core values. The Enron scandal is the most significant corporate collapse in the United States and it demonstrates the need for significant reforms in accounting and corporate governance in the United States. It is also a call for a close look at the ethical quality of the culture of business generally and of business corporations (Lessons from the Enron Scandal).