Sarbanes-Oxley: Effective Governance? Introduction On December 2, 2001, less than a month after it admitted accounting errors that inflated earnings by almost $600 million since 1994, the Houston-based energy trading company, Enron Corporation, filed for bankruptcy protection. With $62.8 billion in assets, it became the largest bankruptcy case in U.S. history, dwarfing Texaco's filing in 1987 when it had $35.9 billion in assets. The day Enron filed for bankruptcy its stock closed at 72 cents
firm's common stock. If a firm is a sole proprietorship managed by the owner, the owner-manager will undertake actions to maximize his or her own welfare. The owner-manager will probably measure utility by personal wealth, but may trade off other considerations, such as leisure and perquisites, against personal wealth. If the owner-manager forgoes a portion of his or her ownership by selling some of the firm's stock to outside investors, a potential conflict of interest, called an agency conflict, arises
and regulations on the investment banking industry starting in 1999. FALSE 3. For the most part, the credit ratings granted to mortgage-backed securities did not accurately reflect the true risk of the securities. TRUE 4. In hindsight, most observers agree that Enron’s problems were caused by a failure of the board of directors to exercise adequate oversight. TRUE
The stakeholder theory is a theory of organizational management and business ethics that addresses morals and values in managing an organization.[1] It was originally detailed by R. Edward Freeman in the book Strategic Management: A Stakeholder Approach, and identifies and models the groups which are stakeholders of a corporation, and both describes and recommends methods by which management can give due regard to the interests of those groups. In short, it attempts to address the "Principle of Who
53 FAIR PRESENTATION---AN ETHICAL PERSPECTIVE ON FAIR VALUE ACCOUNTING PURSUANT TO THE SEC STUDY ON MARK-TO-MARKET ACCOUNTING Sharon S. Seay, Macon State College Wilhelmina H. Ford, Macon State College ABSTRACT Fair value accounting has received a significant amount of blame as the cause of the current financial crisis. Fair value accounting does not cause illiquidity or volatility in financial markets. Banks, rather than accounting, caused the existing crisis, ultimately through bad lending
the rule of corporate law that prohibits a corporation’s directors from any activity that would reduce profits. Disputed business motives – Some critics believe that CSR programmes are often undertaken in an effort to distract the public from the ethical questions posed by their core operations. An example of such a company that had been accused of this motivation is British American Tobacco (BAT). Self-interest – CSR critics argue that the only reason corporations put in place social projects is
available at www.emeraldinsight.com/0309-0566.htm An ethical basis for relationship marketing: a virtue ethics perspective Patrick E. Murphy Institute for Ethical Business Worldwide, Mendoza College of Business, University of Notre Dame, Notre Dame, Indiana, USA Ethical basis for RM 37 Received May 2004 Revised January 2006 Gene R. Laczniak Marquette University, Milwaukee, Wisconsin, USA, and Graham Wood School of Management, University of Salford, Salford, UK Abstract Purpose
and activist groups, the paucity of academic analysis is both surprising and worrisome. Our recent search of the principal academic databases turned up only about a dozen articles, mostly concentrated in journals catering to the intersection of management and environmentalism. One book beyond Elkington 's has been
Journal of Business Ethics (2009) 85:147–156 DOI 10.1007/s10551-008-9934-6 Ó Springer 2008 What’s Wrong with Executive Compensation? Jared D. Harris ABSTRACT. I broadly explore the question by examining several common criticisms of CEO pay through both philosophical and empirical lenses. While some criticisms appear to be unfounded, the analysis shows not only that current compensation practices are problematic both from the standpoint of distributive justice and fairness, but also that
Part Two The Scientific Management Era The purpose of Part Two is to begin with the work of Frederick W. Taylor and trace developments in management thought in Great Britain, Europe, Japan, and the U.S.A. up to about 1929. Taylor is the focal point, but we will see his followers as well as developments in personnel management and the behavioral sciences. Henri Fayol and Max Weber will be discussed, although their main influence came later, and we will conclude with an overview of the influence