A Research Paper: Preventing Conflict or Ethical Issues
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March 27, 2017
A Research Paper
PREVENTING CONFLICT OR ETHICAL ISSUES
Introduction
As per the corporative corporation type developed, the two purposes of proprietorship and administration are disconnected. In the corporations with a huge quantity of workforces the supervisors are the individuals that accomplish the wealth in the finest concern of the stockholders (Boshkoska, 2015). In such kind of establishments, clash of importance may happen amid the supervisors as well as the stockholders. Having additional data regarding the function of the organization, chiefs may utilize it in settling on choices for their own
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Ivanovic Djukic and Predic (2010) show that exceptionally valuable measure is the code of corporate administration that permits stakeholders to perform agreeing their privileges and energizes straightforwardness of the topmost supervisors (Predic and Ivanovic–Djukic, 2010). Hence, in the research paper, we are going to explain and discourse about the approach taken to solve the ethical concerns or conflict amid shareholders and firm managers known as agency problem or conflict.
Goals and Objectives
The foremost intention or goal of the research paper is to reply the subsequent questions:
• What is the principle of the notion of the organization ethical issue?
• What are the procedures that can help to overcome the agency problem?
The research or investigation is built on the proposition that the elucidation for the conflict or ethical issue like agency dispute stay in the amalgamation of numerous procedures (Boshkoska, 2015).
Understanding the Conflict of interest (Agency problem)
In the present day enterprises that are the utmost complex authoritative category, the fiscal investment is partitioned among rather substantial quantity of stakeholders who might be utilized in the organization, additionally lawful elements or potentially individuals might be the proprietors of the organization (Nwidobie, 2013). Inside these substantial companies, the interests of the administrators, shareholders, and leads are interlaced. Because of the way
In this paper I will discuss the conflict that is occurring at General Hospital, the conflict management styles that are evident in the case, and how General Hospital could have used teams to address the cost reductions needed to stay competitive. I will also describe how the CEO of General Hospital, Mike Hammer can us negotiation skills to get buy-in for the cost reductions and finally I will recommend a strategy for Hammer to resolve the problem.
Managers and shareholders are the utmost contributors of these conflicts, hence affecting the entire structural organization of a company, its managerial system and eventually to the company's societal responsibility. A corporation is well organized with stipulated division of responsibilities among the arms of the organizational structure, shareholders, directors, managers and corporate officers. However, conflicts between managers in most firms and shareholders have brought about agency problems. Shares and their trade have seen many companies rise to big investments. Shareholders keep the companies running
Although the author has demonstrated that the ethical code of business, as an instrumental requirement for justice, has difficult to prevent the company from misconducts, personal thinking, we should have
Conflict is a fact of life - for individuals, organizations, and societies. The costs of conflict are well-documented - high turnover, grievances and lawsuits, absenteeism, divorce, dysfunctional families, prejudice, fear. What many people don't realize is that well-managed conflict can actually be a force for positive change.
essay all about. Along with this explanation, the relevance to the business world will be stated. Furthermore, the essay will approach the ethical problem both from a consequentialist and a
Self-interests is the central element of capitalism that ultimately has led to the principle-agent problem in various fields such as public corporation. The central element of capitalism, as part of the American society, is for individuals to serve in their best interests. Therefore, the capitalist’s culture has ultimately led to the principle-agent problem: when the agent, whose power was delegated by a principle, has motives other than acting in the best interests of the principle. In a public corporation, where the ownership is shared by numerous stockholders, the principle, they have to find an agent, such as managers, to operate the business. This problem can be demonstrated when executives, the agent, are trying to fulfill the corporate
As already observed above, the leaders have the responsibility of making the decisions in the firm. They should consider the ethical as well as moral aspects as they make the decisions, and should be sure to make decisions that lead to the benefit of the parties involved. In order to make such decisions, there is need to observe some procedures as indicated in the essay below.
An example of an ethical conflict is, I was working with a 16 year old who admitted he wanted to commit suicide. He is half Native American and half white. He started thinking about suicide when his grandmother terminated her rights as guardian and he was now living at the group home where I work. During the next couple of months we noticed his behavior was becoming more erratic and he started drinking alcohol more frequently, skipping school, hanging with gang affiliated youth, and was detained by police multiple times only to be let go the same day. This was an issue my coworkers and supervisor thought was unacceptable to be living in the group home where actions of youth can potentially shut down the facility and which are behaviors that
Conflicts between stockholders and creditors Conflict between shareholders and creditors is common for the company which use debt capital to form an optimum capital structure. As mentioned earlier, agency relation exist when one party works as an agent of the principal. In an organization management
(This research has been grounded in agency theory, which seeks to solve what is known as the agency problem: that company owners and agents who work for them (management), don’t have the same economic interests, so the solution is to use incentives to align management’s interests with those of shareholders)
As the result, shareholders hire managers(agent) to run the business and act on the shareholder’s behalf. Since managers involved in the daily business, these is information asymmetries between shareholders and managers. Also, managers are likely to have different motives to principals. In shareholder’s point of view is maximum long-term shareholder wealth but the managers may be influenced by different factors such as financial rewards, labour market opportunities and relationships with third parties which are not directly relevant to principals. The management acts in their self-interests instead of acting in the shareholders’ best interests. Therefore, the agency problem arises because there is a conflict of interest between the management and the
Answers to Concept Questions 1. In the corporate form of ownership, the shareholders are the owners of the firm. The shareholders elect the directors of the corporation, who in turn appoint the firm’s management. This separation of ownership from control in the corporate form of organization is what causes agency problems to exist. Management may act in its own or someone else’s best interests, rather than those of the shareholders. If such events occur, they may contradict the goal of maximizing the share price of the equity of the firm. Such organizations frequently pursue social or
Organizational changes include, but are not limited to mergers, acquisitions, affiliations, and consolidations, which affect the roles of the governing bodies, professional staff organizers, senior level managers and the chief executive officer in differing ways. The GBs of an organization play an instrumental role in the modification process of organizational ownership and control. One of the core responsibilities of the GB is to represent, balance, preserve, and advance the interests of its various stakeholders in the entity (Longest & Darr, 2000, pg.68). The various stakeholders include employees, shareholders, the government and the surrounding community of the organization. Board members are obligated to act in good faith and use their authority to promote the best interests of the stakeholders and the organization they govern (Kazemek, 2009). Furthermore, it is necessary for GBs to exercise their fiduciary duty to preserve the organization’s long‐term goals and to sustain the mission that it has originally played a part in formulating. In this context, a fiduciary responsibility is one of trust; it means that one acts to the best of one’s ability in the interest of another, not in self-interest; GBs act on behalf of the stakeholders (Schyve, 2009).
Economic science teaches us that due to their subjective needs, individuals have subjective preferences, and hence different interest. Occasionally different subjective interests give rise to conflicts of interest between contracting partners. These conflicts of interest may result in turn, in one or both parties undertaking actions that may be against the interest of the other contracting partner. The primary reason for the divergence of objectives between managers and shareholders has been attributed to separation of ownership (shareholders) and control (management) in corporations. As a consequence, agency problems
Harry was the employer of the company who worked as a network programmer. In this case study, he started working against the policies of the enterprise by selling his product with the use online platform.