Discussion
Please use as a basis for your discussion the following question: Do you think the events of this chapter (Chapter 2) are isolated instances of business malfeasance, or are they systemic throughout the business world?
I don’t think events in Chapter 2 are isolated instances of business malfeasance. From the cases of Enron, Arthur Andersen and WorldCom, it’s easy to find some similarities. All of them focused on short-term revenue and ignored the long-term development and companies’ integrity and reputation; all of them couldn’t successfully solve the interest conflict between “people on the top” and current and perspective shareholders. For companies, the main goal and theme is to make more profit in general. A stably raising stock price satisfies the board of directors as well as attracts investors to make investment. To achieve this goal, there are two ways to go: one is following all the audit and accounting ethics when directing the company, which may be slow but stable and beneficial in long term; another one is cheating and walking on the borderline of ethics, which can make a lot revenue in short term but prohibits the company’s healthy development in the future. Obviously, companies in those cases in Chapter 2 chose the second way.
However, I can hardly say that they are symmetric problem in the business world. Although there are some bad apples in the tree, there are more companies which aim to long-term healthy development and obey rules and regulations. I agree with Curran’s opinion that there is a give and take relationship on both sides of companies and investors. The two-side relationship urges companies to follow their policies within ethics, especially in current world where there are more Acts to regulate behavior of corporations as well as technology and internet makes information more transparent.
I don’t think events in Chapter 2 are isolated instances of business malfeasance. From the cases of Enron, Arthur Andersen and WorldCom, it’s easy to find some similarities. All of them focused on short-term revenue and ignored the long-term development and companies’ integrity and reputation; all of them couldn’t successfully solve the interest conflict between “people on the top” and current and perspective shareholders. For companies, the main goal and theme is to make more profit in general. A stably raising stock price satisfies the board of directors as well as attracts investors to make investment. To achieve this goal, there are two ways to go: one is following all the audit and accounting ethics when directing the company, which may be slow but stable and beneficial in long term; another one is cheating and walking on the borderline of ethics, which can make a lot revenue in short term but prohibits the company’s healthy development in the future. Obviously, companies in those cases in Chapter 2 chose the second way.
However, I can hardly say that they are symmetric problem in the business world. Although there are some bad apples in the tree, there are more companies which aim to long-term healthy development and obey rules and regulations. I agree with Curran’s opinion that there is a give and take relationship on both sides of companies and investors. The two-side relationship urges companies to follow their policies within ethics, especially in current world where there are more Acts to regulate behavior of corporations as well as technology and internet makes information more transparent.