Ethical Dilemmas Encountered by People in the Business and Management Sector - Essay Example

? ETHICS MANAGEMENT Your School of Engineering, Social Sciences, etc Number and of 17 March 2011 Abstract This paper presents the ethical dilemmas encountered by people in the business and management sector. The individual scenarios illustrate the importance of ethics in management in their day to day activities. The CFA Code of Ethics and Professional Conduct is used as a guideline in resolving each given problem. The Code and Standards serves as the ethical yardstick of investment professionals all around the world, setting aside the aspects of job title or position, cultural differences, or local laws. The values of integrity, competence, diligence, respect, and in an ethical manner with the public, clients, prospective clients, employers, employees, colleagues in the investment profession, and other participants in the global capital markets are hereby applied in the sample problems in order to resolve the ethical issues presented in this paper. Keywords: ethics management, ethical dilemma, code of ethics, professional conduct, values, global investment ETHICAL MANAGEMENT This paper presents some of the common problems encountered in the professional environment by applying CFA Institute Code of Ethics and Standards of Professional Conduct to as a guide in order to resolve the ethical dilemmas. The CFA Code of Ethics emphasizes the values of integrity, competence, respect and how to maintain professional competence by placing the interests of the clients above individual interest. On the other hand, the CFA Standards of Professional Conduct highlights the values of professionalism, duties to clients, employers, colleagues, the integrity of capital markets, investment analysis and recommendations and conflicts of interest. Both are used as point of reference in resolving ethical dilemmas and ethical conflicts by applying ethical theories. Problems A & B As a sales representative, I am faced with the ethical dilemma of whether I should close the deal with Fortune 500 company even if I know that the other 2,000 computers will be delayed in delivery and I will earn a sizeable profit by receiving a big commission from such sale and will definitely boost the company’s stock option. As a mother of two children, my kids are entitled to receive support from me, the money that I will be earning will help our family to defray our daily expenses. On the other hand, I will be in violation of the Code of Ethics as I should “act with integrity, competence, diligence and respect to my clients. I am expected to put the interest of client above my own personal interests”(CFA Code of Ethics 2010). One of my duties to my clients is to be fair in all my dealings with them. In this case, if I pursue with the sale with personal knowledge that the other computer units will not be delivered on time, I am guilty of putting my personal interest above the interest of my client. The long term effect of this sale to Fortune 500 would mean that their company will incur losses because of the failure of delivery on the part of our company. Our company will stand to lose a valuable client if I choose to close the deal without informing them that we cannot deliver on time and blame the delay to the manufacturer of computers. The short term effect will be advantageous on my part as I will receive a lucrative commission and the company will also benefit from the sale by receiving a boost in the company’s stock price and help our executives who want to exercise stock options. In the end, my final decision will be to forego with the deal even if our company will stand to lose a reasonable amount of profit and also if I lose the chance to earn personal gain. The Standards of Professional Conduct requires that in cases of “conflict of interest, I should make full and fair disclosure of all matters that could reasonably be expected to impair my independence and objectivity or interfere with respective duties to my clients, prospective clients, and employer”(CFA Code of Ethics 2010). Henceforth, I am bound to fulfill my ethical obligation to the client. Part C & D I am faced with the ethical dilemma of whether I will turn down the deal which was offered to me by my significant other, who also happens to be the owner of Bleevit Computers, Inc. If I turn down the offer, my personal relationship with my significant other will also be put at risk. On the other hand, if I accept the deal, I will benefit from the sale by earning a big profit. Another pressure is having personal knowledge I will that I will be delivering refurbished computers to my client, Fortune 500, without them knowing it. This is considered as treachery and misrepresentation on my part. They will stand to lose a significant amount of money by purchasing refurbished computers by paying the price of brand new computers. In effect, I will be the cause of the big financial losses of my client if I decide to pursue with the deal. The fact of my intention to leave the company in nine (9) months to start my own dealership would mean that I am intending to escape from any future liability. I will also destroy the good name and reputation of my company if we will deliver refurbished computers to the client by not disclosing such fact to them. This constitutes fraud which may even be the cause of legal suits to be filed against our company and with the information I possess, I have the power and control to prevent it from happening. The short term effect will be advantageous for me and for the company because we will earn a substantial amount of profit from such sale. On the other hand, the long term effect will be placing the company’s reputation and good name at risk and may be liable for criminal offences. The client will also stand to lose a big investment if we will close the deal. In the end, my final decision will be to inform my significant other that I will not pursue with the deal. Selling refurbished computers without informing the client constitutes a fraudulent act and constitutes misrepresentation. I am bound by the Code of Ethics to act with integrity, competence, diligence, respect, and in all my dealings with the clients. The Standards of Professional Conduct requires that in cases of “conflict of interest, I should make full and fair disclosure of all matters that could reasonably be expected to impair my independence and objectivity or interfere with my duties to my clients, prospective clients, and employer”(CFA Code of Ethics 2010). Henceforth, I am bound to fulfill my ethical obligation to the client. References CFA Code of Ethics. (2010) Web. Retrieved on 17 March 2011, from Hosmer, LaRue Tone. (2010) The Ethics of Management 6th Edition. McGraw-Hill/Irwin Publishing. Read More