Table of ContentsINTRODUCTION...........................................................................................................................1Question 1........................................................................................................................................1Globalisation and the agency problem are the causes of unethical behaviour in businesses......1QUESTION 2...................................................................................................................................3a) Was it illegal to trade like Rajat Gupta and Raj Rajaratnam? Whywere Gupta and Rajaratnam’s activities harmful?.....................................................................3b) Agent based approach to question the ethicality of RajatGupta .........................................................................................................................................4CONCLUSION................................................................................................................................5REFERENCES................................................................................................................................7
INTRODUCTIONBusiness could also be termed as company or organisation that is engaged into providingproducts and services to the customers so that profitability could be earned by them. In order toremain competitive in the market, it is very for businesses to introduce innovations in the workso that efficiency of the firm could be enhanced (Mowforth and Munt, 2015). There are variousethical issues that arise at workplace as result of globalisation and agency problem. The reportwill consider all such issues and ways to deal with it. All the societies vary in terms of acceptingbusinesses. There are several ethical issues which should be considered while conductingbusiness activities. Many times ethical activities of employees could lead to heavy losses for thecompany. In the report, various kinds of ethical issues that comes across in conducting businessoperation will be covered in the report.Question 1Globalisation and the agency problem are the causes of unethical behaviour in businessesOver the past few years it has been seen that businesses have found growth in all thesectors as a result of globalisation. Business expansion has increased profitability for the firm.Various means are available by which products could be made and sold into foreign countriesholding competitive advantage in the market. But it has raised ethical issues as well. Developedcountries could have negative impact on the working and trading of developing country. Theycould demand for improvements and may set higher standards for product quality which mightdifficult for the developing countries as they do not strong economic stability. Globalisationmade connected together on single platform by creating so many growths opportunities for thefirms so that they could expand their business (Wright, 2016). Advancement of technology hasmade work much easier and faster for the people. Thus, it also required for the ventures to beupdated with the latest technologies of the market so that work accordingly could be conducted.Agency problem could be defined as an issue that generally occurs when work is notcarried out according to the interests of the investors. It could also be explained as an act whenan individual behaves on behalf of others. The issue arise in such situations is whetherindividuals work on their behalf or for personal interests. For example, people could makebenefits for themselves by acquiring high salaries, private air-planes, offices with luxury andcomfort. The major ethical issue that arise is fiduciary duty which involves breaking of trust. If1
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