Unit 8- Whistleblowing
1. Whistleblowing: Meaning, Kinds, (refer hard copy notes)
Precluding the need for whistleblowing
Note: for ‘precluding the need for whistleblowing’ you may also refer handwritten notes for further insight
2. Marketing Truth and Advertising: Manipulation & Coercion, Allocation of moral responsibility in advertising 3. Trade Secrets
Note: Refer hard copy notes for 1,2,3 or “Business Ethics” by M G Velasquez chapter- 8 (individual in the organization )and chapter-6 (ethics of consumer production and marketing)
4. Corporate Disclosure
The act of releasing all relevant information pertaining to a company that may influence an investment decision. In order to be listed on major Indian stock exchanges, companies must follow all of the Securities and Exchange Board of India’s disclosure requirements and regulations.
To make investing as fair as possible for everyone, companies must disclose both good and bad information. In the past, selective disclosure was a serious problem for investors because insiders would frequently take advantage of information for their own gain - at the expense of the general investing public.
Companies are not the only entities that are subject to strict disclosure regulations. By law, brokerage firms and analysts must also disclose any sort of information that they have that relates to investment decisions. For example, in order to limit conflict of interest issues, analysts must disclose any equities that they own.
As financial reporting and disclosure are potentially important means for management to communicate firm’s performance and value to outside investors, increased disclosure practices will help in reducing information gap between firm and its stakeholders. The main reason behind emphasis on this new emerging issue is that enhanced disclosure and transparency are the twin cornerstones for protecting shareholder’s right. Full disclosure practice along with transparency in financial reporting can build a climate of trust and boost confidence of investors’ community. Corporate disclosure play a crucial role in the current age of information economy. Enhanced disclosure improves efficiency of capital allocation and reduces the cost of capital. Full disclosure and transparency are driving forces for the success of businesses and sustainable performance and helps in maximization of wealth of shareholders. Corporate disclosure might take various forms such as, disclosing information in annual reports, displaying on company’s websites, through blogging and social media, press releases and includes all critical information such as prompt disclosure of price sensitive information that further includes
THE IMPORTANCE OF CORPORATE DISCLOSURE
How companies and other information intermediaries disclose information to outside investors and the market influences how companies are perceived and how they operate financially in their markets. Through regulated financial reports, financial statements, footnotes, management discussion and analysis, and other regulatory filings, companies provide disclosure through a mix of formal and informal information channels. Companies also engage in voluntary disclosure, including management forecasts, presentations and conference calls with analysts, press releases, Internet (information) sites and other reporting formats. Corporate disclosure is mediated by an increasing number of information intermediaries, including financial analysts, industry experts and the financial press. The volume and importance of disclosure by these intermediaries has steadily increased, in part fueled by the debacles with Enron and WorldCom, and the subsequent calls for reform in government-mandated disclosure rules. And the Internet and advances in communications technology generally has spurred an increasing volume of consumer-mediated communications on companies,...