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The Importance of Code of Ethics in Business: A Case Study of QBE CEO's Pay Cut

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Added on  2019-09-23

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This editorial discusses the importance of observing the code of ethics in business using the case of QBE CEO's pay cut for failing to disclose his relationship with his personal assistant. It emphasizes the need for employees to balance productivity and ethical conduct.
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Running Head: EDITORIAL1EditorialsName:Institutional Affiliation:
The Importance of Code of Ethics in Business: A Case Study of QBE CEO's Pay Cut_1
EDITORIAL21. Editorial to the AustralianIntroductionEvery business has a unique set code of ethics that govern the activities of its employees. Any action by the employee that is out of line with the business is highly condoned and may leadto withdrawal of some benefits enjoyed by the employee. A perfect paragon of this situation can be related to a recent pay cut experienced by John Neal for breaking the code of conduct. John Neal, who is the CEO of QBE, is allegedly reported to have been involved in a relationship with his personal assistant without notifying the board. As a result, the board imposed a penalty of $550,000 on his income from his unethical misconduct (Jonathan Pearlman. (2017)).DiscussionIt is an obligation duty for any employee to perform under the stipulated code of ethics that govern the businesses. Any bleach of these rules results to an ethical fault that can be penalized. The board took an appropriate action by penalizing the CEO for performing outside the expectations of the QBEs code of ethics. Regardless of his high ranks within the company, John should have observed the companies rules and report his decision to the board earlier enough. Instead, he highly concealed the issue by making sure that the affair runs privately without the knowledge of the board. When the issue was discovered, John consented that he had performed in an unacceptable way but it was too late to turn the situation around. It would have been fair if John had taken a prior action to inform the board of his personal decision before the situation got out of hand. For him, he expected that the matter would remain undisclosed and personal and would not be publicly known. However, the financial reports of disclosed his situation putting his reputation as well as the reputation of the company at stake. The code of
The Importance of Code of Ethics in Business: A Case Study of QBE CEO's Pay Cut_2
EDITORIAL3ethics required John to report the existence of their relationship with his personal assistance to the board in considerably good time. However, by him acting to the contrary of the code of ethics, he suffered the income cut offs. This situation shows the importance of observing the governing rules of any business regardless of the position that a personal holds in the business. Every member of in the business should be aware of the code of ethics that govern his performance and should be willing to observe them at all times. In addition, it shows us how greatly rules can impact an employee who fails to observe them. A simple rule may hold within it very great power. We learn how failing to take a simple action had resulted to very great repercussions that coasted John a considerable amount of his income as well as greatly tarnish his entire reputation. In most cases, people fail to take the appropriate steps hoping that their actions would not be known to their fellow workmates or other employees. Unfortunately, the outcome is far beyond their expectations and may be known to the entire world like in the case ofJohn.ConclusionIn conclusion, the codes of conduct govern the activities of the employees to make sure they remain productive and obliged to their duties. It is the responsibility of every employee to observe the code of conduct regardless of their positions and ranking on the business. Any person who acts negligently by failing to observe the code of conduct is liable for his action and must be ready for the consequences of their unethical acts. The case of John Neil suffering great penalties of income cut is a lesson that any employee should learn. By observing the simple rules, we avoid other great consequences.
The Importance of Code of Ethics in Business: A Case Study of QBE CEO's Pay Cut_3

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