Making Ethical Decisions. CUNY Graduate School of Journalism August 27, 2012. What is ethics?. Ethics refers to principles that define behavior as right, good and proper
CUNY Graduate School of Journalism
August 27, 2012
According to the indictment: To meet the expectations of Wall Street analysts, the CFO and CEO directed the accounting department to book entries in the company’s accounting ledger that increased revenue. CFO pleads guilty, CEO charged with an $11 billion fraud.
When HealthSouth’s earnings fell short of expectations, CEO Richard Scrushy directed his accounting department “to fix it,” by artificially inflating earnings. The net result was a $175 million reduction in earnings and a Sarbanes-Oxley prosecution.
In face of declining revenue, Sears in 1991 created a sales incentive program that rewarded services advisers for meeting specific service quotas… shocks absorbers, alignments, break jobs. Management never clarified the line between unnecessary services and preventative maintenance. The failure cost Sears $60 million in refunds and settlements.
In order to meet circulation goals, Newsday officers violated ABC rules. Other employees failed to report known violations or intentionally looked the other way.
Source: Saul W. Gellerman, Why Good Managers Make Bad Ethical Choices, Havard Business Review (1986).