Essay on ETH501 Adelphia Case

1512 Words Nov 29th, 2013 7 Pages
For this case study we are asked to draw upon deontological ethics, and discuss how Adelphia Communications’ executives violated the trust of the company’s shareholders and the trust of that of the larger public. To do this we first need to take a look at deontological ethics and how the philosophy of deontological ethics affects the choices that were made in the Adelphia Communications’ case. We will also look at the Adelphia case and examine how its executives violated the trust of the company’s shareholders and that of the public. So what is the philosophy of deontological ethics? Theories in this category address the question of what makes one’s actions right …show more content…
The family used the Adelphia CMS system to withdraw money for personal expenses, capital expenditures, repayments of personal debt and other uses. The amounts were disclosed as small footnotes in the company’s filings.

In the early 2000’s there was increasing focus on corporate governance and overall business ethics after some major business scandals such as Enron. It would only be a matter of time before Adelphia Communications and the Rigas family were under the microscope themselves.

On April 1, 2002 Adelphia announced that it would delay filings of the company’s annual report to the SEC, stating that it needed time to review specific accounting items related to the co-borrowings. About this time major stockholders pressured the company to sell off some of their major assets and merge the entire company to cover the debts.
Investigations by the SEC had reveled major flaws in the corporate governance of Adelphia. They found evidence suggesting that corporate money had also been used to finance a golf course built on the Rigas private property, to buy timber rights for the family and to finance a local hockey team. The family also used company property as if it wee their own, and to take personal vacations using the company planes and spent millions of dollars to fund Ellen Rigas film production company.
As you can clearly see the Rigas family committed several ethic violations, two of

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