In addition, Friedman states that managers are often ill-equipped to be making decisions regarding social interests as they lack the necessary expertise to do so. Contrary to Friedman’s views, scholar Michael Porter offers a different perspective on the role of social responsibility in corporations. In Strategy & Society, Porter asserts that corporate social responsibility is not just an added cost to the business but rather one that can actually be used as a competitive advantage and generate added value to the corporation. Perhaps the biggest difference in the two authors’ opinions is in the role of social
Most people have the tendency to distrust corporations in the market and the larger the firm, the worse the problem of trust usually gets (Rushton 2002, 138). Highly visible business ethics issues influence the public’s attitudes toward business and can destroy trust. Ethical decisions are a part of everyday life for those who work in organisations (Ferrell, and Fraderich 2012, 25). As such, the ability for the corporation to maintain a good public image, retrain customer trust and succeed as a firm highly depends on their ability to comply with business ethics defined by the society and environment it is surrounded by. “The Moonlighter” by Bronwyn Fryer is an article consisting of several ethical dilemmas where problems can range from large to small and from personal to business for several individuals.
Ethical Behavior in the Current Business Environment Currently, there seems to be a feeling of distrust among many Americans about the corporate environment. So many companies are being exposed for committing fraud, i.e., Enron, Tyco, Freddie Mac, AIG, etc., that it can be a challenge to believe that any company behaves in an ethical manner. However, out of the millions of businesses in this country, large and small, only a small percentage is exposed as being unethical. The corporate environment appears to be more conducive to ethical behavior. The Current Ethical Business Environment Corporations understand the importance of ethical behavior and usually have a code of conduct that all of their employees are required to follow.
Businesses became tasked with adopting and even developing the ever-evolving role of ethical leadership and exhibitors of best practices of corporate governance as it relates to the efficiency and success of businesses, their shareholders, stakeholders and the United States economy. Because of the deception and abuse uncovered in these scandals which involved executives and accountants, consumer confidence in corporate America and in accountants suffered. And who can blame them? With such blatant abuse and disregard of
Top executives of companies are hired to improve performance and the pressure to do so can lead them to take unethical action to ensure their success. Publicly traded companies are consistently pressured by internal and external stakeholders to perform at higher level. When organizations are about to release financial reports that would possibly lead to a financial loss to the shareholders, the pressure to perform unethical accounting practices will increase. There is an opportunity to adjust the numbers so the financial reports will represent a more desirable outcome. Employees have the same opportunity to perform unethical accounting activities as the top executives.
An ethical dilemma is defined as a morally problematic situation in which you must choose between two or more alternatives that aren’t equally acceptable to different groups. Ethics in business have gained much attention over the years. Some ethical dilemmas are fairly straight forward; meanwhile others can be a bit more complex. Based on the scenario for Angela at WellCare USA, the suggested course of action will be discussed. Angela’s ethical dilemma is that of adhering to the confidentiality requested of her by her firm vs. listening to her moral compass and looking out for her friend by warning him.
(Osmond, 2014) Accountants do not always follow the moral guidelines set out by the company’s managerial accounting and thus creating ethical problems within the business. The resultant effect of not following the set out moral values is that stakeholders lose confidence with the company’s financial stability. Ethics will be important in ensuring that the accountants always prepare the books of account in time and update them in time. The accountants will also be in a position to report correct, accurate and ethical information on the financial position of the organization (Osmond, 2014) Managerial accounting is characterized by forecasting for the future sales of the business. It focuses on the users of the company’s business details.
Pricing, billing and collecting fees What CPA firms can do to run their businesses more efficiently and effectively. By Edward Mendlowitz, CPA/ABV/PFS/CFF CPA firms provide invaluable advice to business clients but often struggle to run their own businesses effectively, particularly in the areas of pricing, billing and collections. Failure to set appropriate fees, deliver bills in a timely fashion and collect payment promptly—or even in full—cuts into a firm’s profitability, hurting the business and the accountants in it. Remedying this situation requires CPA firms to make a conscious effort to ensure they get paid an appropriate price in a timely fashion. To best do this, CPA firms should secure the fee agreement upfront, when their value to the client is greatest, and make sure they deliver excellent work on, or ahead of, schedule.
A business plan is the ‘road map’ for a business future growth and development, however, the importance of a business plan is frequently underestimated in today’s corporate society; where some fail to produce a business plan and some don’t plan well enough. ‘Business doesn’t plan to fail. They fail to plan’ – this effectively describes the nature of today’s corporate world. It is essential that future business owners and existing business owners understand and establish an extensive business plan outlining its goals, operations, marketing, finance and human resources in order to ensure ultimate business success. The business planning process is not easy and can be quite time consuming.