Morgan Stanley Ethical Statement

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Background Morgan Stanley is a global financial services company. Through its subsidiaries and affiliates, the company provides a wide variety of products and services to a large group of customers, including corporations, governments, financial institutions, and individuals. (“Morgan Stanley’s Annual Report”, 2016, p. 1). According to the company’s 10-K report, Morgan Stanley’s core value is described as “Putting Clients First, Doing the Right Thing, Leading with Exceptional Ideas and Giving Back.”. The company has established standards and measures to hold employees accountable for conducting themselves in accordance with these core values, such as new hire training, annual ethics training, etc. (p. 78). In October 2016, Morgan Stanley was charged with operating an unethical, high-pressure sales competition in order to boost its sales. This internal contest led financial advisers to sell security-based loans to the customers to receive the incentives based on a number of loans sold. The incentives were: $1,000 for 10 loans, $3,000 for 20 loans, and $5,000 for 30 loans. In many cases, the clients did not need the offered products or services (Salazar, 2014, Herbst-Bayliss, 2016). Stakeholder Theory According to Smith (2003) and Schmidt (2012), stakeholders are anyone who contributes and is affected by the business capacity and activities, such as shareholders, customer, employees, suppliers, and local communities (p. 86). Morgan Stanley’s sales contest is an example

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