“Behavior of owners and workers in business firms is

Ethical behavior is legally governed rather volunteered by organizations

Corporate Organizations , in today 's cut- throat competition and globalized economy are forced to focus to improve their bottom line Corporate governance or ethical practices are limited to a level which is mandatory as per laws . Genuine commitment to ethics is like a needle in haystack

There are various elements to ethical behavior expected from the organizations

Accounting transparency : Enron and Worldcom are glaring examples where ethics were compromised to maintain profitable image of the organization . Accounting firm Arthur Anderson 's

creative accounting and ulterior motives of management crippled investor 's confidence to the nadir , resulting in bankruptcy / closure of all three organizations

Leading by example : As per data , US CEOs were paid 42 times the average worker 's pay in 1980 , to 85 in 1990 , and then skyrocketed to 531 times by 2000 . Leadership teams of organizations are paid everything to show healthy growth in turnover and profits , for shareholder to be exited at stock markets . No CEO is paid to exemplify ethical leadership at Wall Street

Child labor : Many corporate , primarily in apparel segment , overlook the extreme levels of child exploitation in third world countries . In absence of strict law or policy , child labor is another big area which is not effectively monitored and contained

Summary : Though state (U .S . Securities and Exchange Commission ) try to put accounting and auditing system , Corporate Ethics remain an Oxymoron Ethics , like democracy , is a lot easier in theory than in practice . It would be imperative on regulatory bodies and responsible corporations to take lead in showing value in becoming ethical organization . Moreover shareholders also should reward organization which exhibit transparency and good quality corporate governance

References

Munzig

G , Enron and Economics of Corporate Governance ' Stanford University (June 2003 (http /www-econ .stanford .edu /academics /honors_theses /theses_2003 /Munzig .pdf

Holmstrom , Bengt and Steven N . Kaplan , The State of US Corporate Governance : What 's right and What 's wrong ' National Bureau of Economic Research : Working 9613 (2003

Jense , Michael and Kevin Murphy , 1990 , Performance Pay and Top Management Incentives , Journal of Political Economy (1990

September /October 1996 edition of At Work HYPERLINK "mailto :AtWorkNews aol .com " AtWorkNews aol .com , byBerrett-Koehler Publishers . Jon Entine is a writer and Emmy...