Toshiba Scandal – The power of context:
This section will discuss the role of context at different level contributing to the Toshiba’s scandal. The context can be classified into three broad types based on the way it contributes to the ethical blindness and the people it interacts and influences in causing ethical blindness. They are Individual Context, Organizational Context, and Societal context. Toshiba case is a typical example of how the context has influenced the ethical blindness.
Individual Context:
Toshiba was headed by Atsutoshi Nishida and then by his successors Norio Sasaki and Hisao Tanaka when the continuous inappropriate accounting treatments happened. From a ten thousand feet look at the case, three CEO’s were at the helm
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Tom Scott, a former executive of Toshiba US told, “He gave me targets that scared the hell out of me. Tough like nails, maybe a little like Patton in World War 2”, when asked by Reuters after Nishida’s resignation(Murai, A. R., Hamada, K., Uranaka, T., & Takenaka;, K. (2015, August 24). In Toshiba scandal, the 'tough as nails' target setter). His view was the common one among the employees in Toshiba. The CEO’s were ambitious and set challenging profit targets that were not possible to achieve with the regular means. The subordinates felt the pressure and were afraid of not being able to achieve the targets. On the other hand, the audit control within the organization was very relaxed. Internal auditing committee was dysfunctional and they did not raise any concerns at the meeting about the improper accounting practices employed by divisions to meet the targets. This encouraged the divisions that were struggling with the targets to fudge accounting data to achieve them. They started looking at it as something normal over a period of time. On an organizational level, loose internal control, the culture of fear, ambitious CEO, group conformity pressure were the major contributors to the
The behavior exhibited by the founders in intuiting that it was Samarin’s responsibility to load the illegal software, and in creating a financial management environment with an evidenced lack of financial restraint further demonstrates an organizational culture of low accountability and questionable ethical standards.
This paper explores how ethical issues of Pinto case have affected the Ford Motor Company business environment. A number of factors suggest that Ford Motor Company was negligent and violated its code of ethics. In this paper, we will review the corporate culture mindset which prioritizes profit over the value of human life for the purpose financial gain.
Ethics and moral obligations are issues we all encounter at one time or another. In the professional setting, all people should act in a manner that would uphold the good of society. To be ethical, one has to determine their obligations, moral ideas, and moral philosophy (Boatright, p. 19, 2009). The case analysis involving Jacob Franklin was a perfect example of how an individual can face the dilemma of doing what is right or wrong. Businesses have their own code of ethics, and the employees within the business have to determine whether or not they will follow the company’s code of conduct. I will discuss several ethical issues in the case analysis including; failure to report information, remaining silent regarding faulty equipment,
In this case Jake Markos is the moral agent and is contemplating on whether or not he should embed spyware into the Diabetes Foundation website that allows his company, ALAC marketing, to collet email addresses and use them to market a product. Other moral agents presented in this case are Nathan Brook, Jake’s boss, Maia Herrick, Nathan’s assistant manager, and ALAC Marketing. In this case, ALAC is the least important moral agent because it possess vicarious moral sensitivity and responsiveness thus, if we examine the sensitivity and responsiveness of its individual employees we would understand ALAC’s position regarding Jake’s dilemma. This is also, in part, due to the fact that corporations employ highly organized holistic decision-making and although corporations are morally accountable it does not mean that individuals who are employed by the corporation are not also morally accountable.
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.
What are the pressures that lead executives and managers to “cook the books?” There are several factors that can come into play. For WorldCom, it started with the deterioration of the industry in 2000. This was due to overcapacity, heightened competition, the economic recession, the dot-com bubble collapse, and a reduced demand for telecommunications services. All of these factors put extra pressure on WorldCom’s most important performance indicator, the expense-to-revenue ratio. The company was so concerned about keeping it above 42% that they were willing to do anything, even commit fraud. Bernie Ebbers told the senior staff that they would lose everything if the company did not improve its performance.
The case study that was analyzed is, “Unauthorized Disclosure: Hewlett-Packard’s secret Surveillance of Directors and Journalists,” by Anne T. Lawrence, Randal D. Harris, and Sally Baack. The ethical issues presented through the case deal with Hewlett-Packard Company (HP). HP is a major international company in the computer and technology market. The company describes itself as a “technology solutions provider to consumers, business and institutions globally.” Their credo is called “HP way”, which focuses on points such as trust and respect for individuals, high level of achievement and contribution, business conduct with uncompromising integrity, objectives through teamwork, and encouragement of flexibility and innovation (Newman). The problems faced by HP’s board of directors were a lack of accountability with HP’s credo. If the “HP way” was followed by them, these ethical issues would be avoided. It also promotes a bad example by the high-level of management of this globally powerful organization.
The executives are accountable to the board of directors. Instead of protecting the investors, the board enticed the culture of financial fraud in the company for selfish gains. It failed in its duties in keeping the executives in check.
On March 15, 2005 former CEO of WorldCom, Bernard Ebbers sat in a federal courtroom waiting for the verdict. As the former CEO of WorldCom, Ebbers was accused of being personally responsible for the financial destruction of the communications giant. An internal investigation had uncovered $11 billion dollars in fraudulent accounting practices. Later a second report in 2003 found that during Ebber’s 2001 tenure as CEO, the company had over-reported earnings and understated expenses by an astonishing $74.5 billion dollars (Martin, 2005, para 3). This report included the mismanagement of funds, unethical lending practices among its top executives, and false bookkeeping which led to loss of tens of thousands of its employees.
The focus of the project you’re about to read is on the recently phone hacking scandal of famous UK News agency, - The News of The World. The report include a brief explanation of what has happened based on pre-selected online articles, analysis of the scandal from Business Ethics point of view by using various CSR theories discussed during the CSR course in period four and provides conclusion and recommendations on what could have been done.
This paper describes the case of Olympus, a Japanese manufacturer of optic equipment, at which in early 2012 a scandal was uncovered which was soon dubbed to be one of the largest loss-concealment schemes of Japan. In the 1990’s, Olympus incurred significant losses on financial investments made. These were subsequently hidden with the aid of investment companies by shifting the investments around. In the 2000’s, these losses were to be repaid by paying exorbitant merger and acquisition fees to these investment companies. After newly-appointed CEO Michael Woodford blew the whistle on these frauds, the company got into trouble. Our research into the events leading to this
In the aftermath of the scandal, there were negative, long-reaching effects on a variety of stakeholders.
A combination of pressure CEO and culture Toshiba that cannot be emend error management judge, make Toshiba lose their confidence. Because Toshiba have done betrayal confidence to everyone .The problem, a company that there has been one since 140 years ago has been do overstated on their financial report. Scandal that owned by Toshiba is not small cases .Toshiba have done overstated very large namely 151,8 billion YUAN or 1.2 billion USD .This scandal not done a little while, Toshiba out of it began from 2008 April and new revealed in 2015 which is about 8 years Toshiba have out of this. Deviation this revealed by independent investigation committee led by Koichi Ueda. Scandal that do by Toshiba not only involving managers Toshiba but also
With the rise of globalization and the complex dynamics of the global business environments, organizations are tackling and forced to deal with large ethical issues on a daily basis. The ramifications for an organization that does not handle an ethical scenario efficiently and effectively could put the entire company and organization at dire risk. Organizations put their company brand and identity on the line with their everyday decisions and how they choose to operate themselves and their business. Many companies will do anything to keep their image or façade in good graces with the public and try to cover up or hide the mistakes with hope that their mishap or fault will never be exposed. The auto industry has had its fair share of
The company faced issues related to the methods it used in investigating the unauthorized disclosure of nonpublic information to the press by the members of its board of directors. Apparently, Hewlett Packard hired some investigators in the case. The investigator used various techniques such as pre-texting- calling the telephone company and pose as someone else with an aim of obtaining that person’s information or records. The company and the board chairman, Patricia Dunn, were defending the company’s investigations about the director and the journalist. They cited that there were aggressive efforts to note the core source of leaks that were fully justified by the investigators