Ethic based management

Topics: Ethics, Business ethics / Pages: 6 (1395 words) / Published: Nov 25th, 2013
ETHIC – BASED MANAGEMENT VS CORPORATE MISGOVERNANCE ---
NEW APPROACH TO FINANCIAL STATEMENT ANALSYS

Introduction
Unfortunately in today’s everyday business consists largely of corporate fraud and unethical behavior. The article likes to call this down turn of ethical behavior moral bankruptcy. Moral bankruptcy is defined by dictionary.com as the state of being devoid of morality and ethics, used especially for business and political entities. This article focused on the moral devoid of business and political entities. We have seen the moral bankruptcy of high profile cases such as Enron and Tyco that has led to the everlasting change of the way we do business and the way that financials are prepared and analyzed. What may not be as public is the knowledge of why banks are failing. This article mentioned cases in how banks have engaged in fraudulent deals, currency and drug trafficking, smuggling, corruption, forged letters of credit and bank receipts, and the manipulation accounts. These unethical activities have far reaching impacts that may not be realized by the common person. Banks are not the only businesses engaged in unethical activities. Unethical activities have become an everyday part of daily business.
Governments have also been identified as the source of unethical behavior. Moral bankruptcy in government affect countries all across the world in different stages of development. Moral bankruptcy is said to be more severe in developing countries. We will look at a case study a little later in this review.
Corruption Identified
M. R. kumara Swamy classified corruption in the following ways:
Democratic Corruption – refers to illegal payment by the people, of the people and for the people.
Hierarchic/Anarchical Corruption – relating to bribery which must be compulsorily paid to get work, devoid of prudent financial management considerations, accomplished/executed with the blessing of the political party in



References: Swamy, K. M. R. (2012). Ethic-based management vs corporate misgovernance – new approach to financial statement analysis. Journal of Financial Management, 25(2), 29-38 Beeri, I., Dayan, R., Vigoda-Gadot, E., & Werner, S. (2013). Advancing ethics in public organizations: the impact of an ethics program on employees ' perceptions and behaviors in a regional council. Journal of Business Ethics, 112(1), 59-78. doi:10.1007/s10551-012-1232-7

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