Ethical Issue in Special Purpose Vehicles (SPVs)- Article
Added on 2020-02-24
6 Pages1410 Words125 Views
Last Name 1Business EthicsStudent’s NameName of the ClassProfessor’s NameCityStateThe Date
Last Name 2Business Ethics1.Ethical issues from the titled article “Enron Ethics” The first major ethical issue in the article is the creation of “Special Purpose Vehicles (SPVs)” by Enron. The company entered into a partnership to raise money and boost its position in the market [ CITATION Ron03 \l 1033 ]. However, the management applied deceptive methods to mask its declining financial performance. Partnerships allowed the company to sell assets and book revenues before to a partnership. This ethical issue enabled the company to generate huge revenues. Partners and potential investors thought that the company was performing well and continued to invest. Besides, the SPVs included a fraudulent technique to hid debts from the balance sheet. The SPVS is an ethical issue because a conjunction of motive and opportunity leads to an ethical hazard [ CITATION Pen12 \l 1033 ]. The second major ethical issue was encouraging employees to invest heavily in the company without informing them of the financial status. The business executives were aware that the company was making significant losses. A few business executives were earning millions of dollars at the expense of the ignorant workers. Most of the employees had invested their life-savings in Enron with the hope of earning good returns. There are indicators that the executives knew that the company would run bankrupt. Jeffery Skilling resigned from his position as the CEO when the accounting dealings of Enron became intricate [ CITATION Ron03 \l 1033 ]. This issue is an ethical issue because the business management propagated corruption on a colossal scale without considering the employees’ investment. The situation can be attributed to fraud on a large scale. 2.How to develop virtuous
Last Name 3The primary concept is that virtuous is like a skill that can be learned and practised. Hence, humans can learn and practice skills in their daily life. Aristotle’s virtue ethics is not absolute. There is thus a chance for every human being to develop and enact virtuous. A person can make good judgement when it is desirable or at the right time. Once a person develops virtuous, they will be in a position to express good character in the most deserving events. Consequentialist judges whether the act is right or wrong based on the results of the action [ CITATION Sha08 \l 1033 ]. If the results of an action are good, then it will be considered as right. Even if the intentions of a person were wrong, the action would be judged based on the consequences. This theory differs from virtue ethics because virtue ethics judges the action ratherthan the outcome. On the other hand, non-consequentialist considers the reason for a certain action and not the outcome [ CITATION Sha08 \l 1033 ]. This theory judges people on how good their intentions were regardless of the consequence. For instance, if a wrong action leads to a good outcome thenit will be considered as good. Conversely, if a right action results in a wrong consequence, then itwill be considered as wrong.The main difference in these three theories is about decision makingand outcome of the decision. This difference is evident in peoples’ character and judgments when faced with moral dilemmas. 3.Kellogg’s CRS statement The Kellogg’s CRS statement is insincere. The CRS statement is structured to convince the public that the company is socially responsible. Additionally, the company aims to attract potential customers to the business. In its CRS statement, Kellogg argues that their products are nutritious and meant to enhance healthy lifestyles. However, different organisations have shown
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