Business Ethics Case Study: The American Red Cross
The American Red Cross Case Study
Introduction
The American Red Cross (ARC), founded in 1881, is an independent organization, supported by public financial donations and volunteerism. Its mission is to “provide relief to victims of disasters and help people prevent, prepare for and respond to emergencies.” Despite having a great visionary and doing great cause, ARC was, and still is, facing lot of unethical issues. High rate executive turnover, slow response to disasters, mismanagement of donations and funds, and no background screening on their volunteers are few of the examples.
Ethical culture
Ethical culture of an organization is the guidance or principles to determine if one’s action is right or wrong. It is usually created by the …show more content…
First, it happened at the top level. Top executives committed fraud and received undeserved benefits. Punishments for such actions did not exist. They repeated and committed these unethical behaviors. Second, the organization mismanaged the money from donations. Victims and their families did not receive the funds they need in time or in full amounts. Lot of these donating monies were cut off and used for other purposed. The organization did not complete their duties and follow their main purpose. Last but not least, the ARC’s impartiality was impaired. It made an unethical decision when they partner with big corporate companies. The ARC’s policies prevented the organization to use such cause to benefit itself and the companies it partner with. It is its duty to scrutinize the corporate donations and make ethical decision with these donations. In conclusion, the American Red Cross has an obligation to fulfill its charter’s expectations and deliver these promises effectively and efficiently. The ARC staff and volunteers need to be well managed by ethical and capable executives. These executives must always followed their duties and perform their job at the highest ethical level. Relationships between the organization and private corporations should be continued, but, must follow the framework of ethic. These relationships will provide great opportunities to help aiding the victims in needs as long as …show more content…
Bernadine Healy received $1.9 million in salary and severance pay upon her departure in late 2001. Marsha Evans received a total of $780,000 in 2005, included a $36,495 unpaid bonus. These were the prime examples how ARC’s structure and compensation operated. They had a very favorable punishment for those executives who committed unethical behaviors. Instead of taking away their money in fines, the organization gave these executives more money. As a result, these unethical behaviors were repeatedly happened over again from time to
Introduction
The American Red Cross (ARC), founded in 1881, is an independent organization, supported by public financial donations and volunteerism. Its mission is to “provide relief to victims of disasters and help people prevent, prepare for and respond to emergencies.” Despite having a great visionary and doing great cause, ARC was, and still is, facing lot of unethical issues. High rate executive turnover, slow response to disasters, mismanagement of donations and funds, and no background screening on their volunteers are few of the examples.
Ethical culture
Ethical culture of an organization is the guidance or principles to determine if one’s action is right or wrong. It is usually created by the …show more content…
First, it happened at the top level. Top executives committed fraud and received undeserved benefits. Punishments for such actions did not exist. They repeated and committed these unethical behaviors. Second, the organization mismanaged the money from donations. Victims and their families did not receive the funds they need in time or in full amounts. Lot of these donating monies were cut off and used for other purposed. The organization did not complete their duties and follow their main purpose. Last but not least, the ARC’s impartiality was impaired. It made an unethical decision when they partner with big corporate companies. The ARC’s policies prevented the organization to use such cause to benefit itself and the companies it partner with. It is its duty to scrutinize the corporate donations and make ethical decision with these donations. In conclusion, the American Red Cross has an obligation to fulfill its charter’s expectations and deliver these promises effectively and efficiently. The ARC staff and volunteers need to be well managed by ethical and capable executives. These executives must always followed their duties and perform their job at the highest ethical level. Relationships between the organization and private corporations should be continued, but, must follow the framework of ethic. These relationships will provide great opportunities to help aiding the victims in needs as long as …show more content…
Bernadine Healy received $1.9 million in salary and severance pay upon her departure in late 2001. Marsha Evans received a total of $780,000 in 2005, included a $36,495 unpaid bonus. These were the prime examples how ARC’s structure and compensation operated. They had a very favorable punishment for those executives who committed unethical behaviors. Instead of taking away their money in fines, the organization gave these executives more money. As a result, these unethical behaviors were repeatedly happened over again from time to