A corporation is a separate legal entity that possesses distinctive liabilities and privileges than that of their members or shareholders. As an investor, a corporation’s advantage is liability for their own investments especially in risky investments (Kubasek, et al., 2012, p. 760). Among the various types of corporations for Betty to select from, an S corporation is an enticing venture for new entrepreneurs given that it grants limited personal liability for debts, sharing of corporate profits, and taxation relief. Double taxation is a main disadvantage of C corporations but not for S corporations. The General Corporation Law (Corp C §§100-2319) treats S corporations similarly to partnerships for taxation purposes.
Analyze three of the punishments that corporations undergo when they have acted unethically (i.e., name them, define them, explain what they are). In addition, explain three threats to running an ethical corporation. Finally, from your own perspective, explain whether or not a corporation should have to function by the same codes of morality that individual people in society have to abide by or if they should be allowed to get away with certain actions that people in society cannot get away with.
This allows each owner to protect personal assets from claims and lawsuits against the company. This limits the liability of each owner the amount that he or she has invested in the business. The LLC also has the option to choose your own tax situation. In addition, the ruling does not affect the personal finances of the owner as a sole proprietorship.
Under this task I will explain the ethical issues that business needs to consider in its operating activities and how a business they could improve the ethical of their operations and also I will evaluate the influence of stakeholders exert in one company.
Organization leaders have a responsibility for upholding the proper standards as they pertain to ethical behaviors in the workplace. Leaders are constantly faced with making the best decisions possible for their corporations and to increase profits for company stakeholders. Unfortunately, some stakeholders do not always make the right choices, especially when the wrong one choice is more enticing. My research will determine the stakeholders invested in PharmaCARE, analyze the ethics of their treatment of the indigenous population and its rank-and-file workers versus the executives, and determine whether Allen can legally fire a few of his employees. Also, determine
The third step to obtaining necessary approval and securing support from my organization's management is related to any legal or ethical concerns that might arise. My research will therefore include an outline of
The problem to be investigated is the application of business ethics. In the business world, ethics are extremely important. Ethics are prime elements that help a business to grow and to become more productive. It is by applying proper business ethics that a business can operate in a moral or ethical business environment and managed to conduct all activities in a manner that maximizes profits while not compromising all other non-economic concerns(Schwab, 1996). Businesses have over the years failed to nurture business ethics in order to fulfill shareholders' interests and to have a culture that is oriented towards profit maximization and high performance(Jennings, 2012; Sims & Felton, 2006). This has led business to have gray areas in their activities. Gray areas are those situations or problems that do not fit exactly into any ethical analysis. These are the activities which may be represented to be immoral as a result of lying and false representations on the part of the business.
2. Ethical Issues in Business. It seems that every day in the news we are hearing of new company that has acted at least unethically and possibly illegally in the operation and financial reporting of their company's business dealings. There are many ethical issues in business. One major issue that we see is over and under reporting net income. Companies like to show that every quarter the net income of the business has an increase or profit. In order to show this they adopt unethical or illegal means in the operation and financial reporting. One such method is the indiscriminate use of stock options for employees that enable companies to take employment costs off balance sheet and inflate earnings. With the recent ethical issues we have
Using 2 different companies as example, analyse and evaluate the ethical decision making process within a business setting.
Today’s business world presents numerous ethical issues. In today’s world above board/moral ethics in organizations do not often materialize intuitively. Organization must strive to provide employees with a clear understanding of the overall company vision. This will aid employees in practicing the code of ethics, policies and procedures in the workplace. Companies must be unwavering in continuously delivering the uppermost ethics of provision in which customers, applicants and employees are entitled to under fair business practices. One major core value is to uphold responsible and fair business practices.
Ø Give some specific examples of ethical issues that confront businesses and how these might be addressed.
Traits associated to a psychopath include irresponsibility, manipulation, grandioseness, lack of empathy, asocial tendencies, inability to feel remorse, refusal to take responsibility for one's actions and superficial relations with others. Modern day corporations display every one of the previously listed characteristics. Is it right that an institution, whose power now rivals that of the State that once created it to seek the better welfare of its citizens, display the psychological traits of a dangerous personality disorder? Many say no: there is a rising discomfort with the corporation and its pervasion into every sphere of human life and it is this uneasiness that has prompted many academics to further study the corporation and its
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
The advantages to a LLC are: 1) Reduction of personal liability. A sole proprietor has unlimited liability, which can include the potential loss of all personal assets. 2) Taxes. Forming an LLC may mean that more expenses can be considered business expenses and be deducted from the company’s income. 3) Improved credibility. The business may have increased credibility in the business world compared to a sole proprietorship. 4) Ability to attract investment. Corporations, even LLCs, can raise capital through the sale of equity. 5) Continuous life. Sole proprietorships have a limited life,
Corporation origin from the Latin word Corpus which means body. It is formed by a group of people and has separate rights and liability from those individual. In any means, corporation exists independently from its owner and this principle is called the doctrine of separate personality. Doctrine of separate personality is the basic and fundamental principle in a Company Law. This principle outline the legal relationship between company and its members. Company’s assets belong to the company not the shareholders as assets are the equity for creditors. Company must use up all its assets to pay off the creditors if it became insolvent. The same applies to the corporation’s debts. For limited liabilities company, the shareholder liability is limited which means that the shareholder is restricted to the number of shares they paid and not personally liable for the corporation’s debts. If the company does not have enough equity to pay off debts, the creditors cannot come after the shareholders. However, limited liability company can be very powerful when in hands who do fraud and on defeating creditors’ claims. Courts then can ignore the doctrine for exception cases and lifting the corporate veil. Lifting the corporate veil is a situation where courts put aside limited liability and hold a corporation’s shareholders or directors personally liable for the corporation’s debts.