Ethical Analysis of Wirecard Scandal: Managerial Social Responsibility

This assignment presents a detailed case study analysis of the Wirecard accounting scandal, focusing on managerial social responsibility and ethical decision-making. The report begins with an introduction to managerial social responsibility, defining its importance in preventing and enhancing societal welfare. It then delves into the facts underpinning the ethical dilemma in the Wirecard case, identifying the decision-maker and the conflicting demands they faced. The initial ethical problems are outlined, followed by an exploration of various approaches to ethical decision-making, including Kantian ethics, utilitarianism, and virtue ethics. The assignment provides specific recommendations to the decision-maker to resolve the ethical issues. The analysis covers the roles of EY, Wirecard, and other stakeholders. The report aims to provide a comprehensive understanding of the ethical challenges and how they were addressed. The conclusion summarizes the key findings, reinforcing the significance of ethical considerations in managerial practices.

BMA250 Managerial
Social Responsibility

Table of Contents
Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Facts which underpinned ethical dilemma in case.................................................................1
Decision maker in chosen case as well as conflicting demands which have to
accommodate.............................................................................................................................2
Initial ethical problems faced by decision maker in case......................................................2
Approaches to ethical decision making through analysis of ethical issue............................3
Recommendations to decision maker in case in order to resolve issues...............................4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Managerial social responsibility is referred to as obligation as well as commitment of
managers in order to make various steps for preventing as well as enhancing societies welfare
also with preventing their own interest. As managerial social responsibility is consisting of
having a sense of duty of society as well as whole elements of society (Gong, Xu and Gong,
2018). It generally refers to managers that are accountable in order to society for keeping it large
in terms of shareholders. This report is based on managerial social responsibility in terms of a
case study of ethical analysis of wire card accounting scandal which is a part of big 4 accounting
companies that are established in 1989. As this report includes facts that are underpinned in
ethical dilemma in case study, decision maker in chosen case along with conflicting demands
that have to deal, initial ethical challenges faced by the decision taker in case study, model to
ethical decision making by evaluation of ethical issues, recommendations to decision maker in
terms of resolving issues along with its conclusion.
MAIN BODY
Facts which underpinned ethical dilemma in case.
As Ernst and Young also referred to EY considered to be a part of big 4 accounting
companies that are established in 1989. Is one of best accounting company that has many
customers across global world which consist of wire card company. As EY wire cards external
auditor position in order to approve as well as sign wirecard financial statement for over a time.
Company was itself a technological company that is headquartered in Germany (Yuen, Thai and
Wong, 2018). The uttermost performance of company is when they consisted in 30 mentioned
companies on Germany’s wealthy stock index in 2018.
As challenge in case study rises at a point when company was under pressure of Marsalek's
demand for shutting down their project ring research. As a fact that underpinned in case study is
that professional accounting companies in Germany has owned a duty for carrying out audit
through credibility as well as integrity. At time of ethical issues project managers of company
have to deal with different competing demand as well as pressure as they are determined that
they should carry out their project ring research to its route for having a detailed as well as
informed is disclosure (Chi, Zhang, C. and Liu, 2019).
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Decision maker in chosen case as well as conflicting demands which have to accommodate.
As forensic and service managers of EY are considered to be their decision maker of case
study as company was in under pressure through Marsalek's demand in order to shut down their
project ring investigation. It is one of most professional accounting company in Germany that
has to own their duty for reaching out auditing in terms of integrity along with credibility. So as
a result decision maker in this case study has to face about ethical dilemma which is going to be
EY forensic as well as integrity service managers that are responsible for identifying ethical
issues where project managers has to handle with different competing demand along with having
pressure. as we are aware of that they should carry project ring research to their root for having a
detailed along with informed disclosure to BaFin (Verk, Golob and Podnar, 2019). Also on other
hand they are facing problem of losing their auditing contract through wire card as their one of
influential customers in Germany. Along with EY acknowledges that company has to stop via
card as their contract for losing their massive amount of money. Also with that they are facing
ethical issues on creating demands in terms of integrity as well as credibility of performing their
roles in their working manner.
Initial ethical problems faced by decision maker in case.
Initial ethical dilemma faced by decision maker was to proceed with the investigation or
not. As in both the cases decision maker, his company and relevant stakeholders would be at risk
of losing something.
Party’s that are associated with the situation are
 EY’s Project Managers
 EY Company
 Baffin
 Wire card Company
 Wire card’s Senior Manager
 Wire card’s shareholders
 Wire card’s Customer
 Public
 Decision maker had to come up with the decision without compromising his ethics.
In case if he moves ahead with the investigation it was imperative that wirecard would no
longer be in business with his company which will lead to a loss of a huge account for his firm at
the same time wirecard’s stake holders employees and its customers would be facing huge losses
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along with their diminished reputation (Morrison, Misener and Mock, 2020). On the other hand,
if he chooses not to proceed with the investigation they would become a part of the illegal
activity that Wirecard may have undergone and its implications would be loss of his and his
company’s reputation. Along with legal implications. If the whistle blower is correct and there is
wrongdoing as such in Wirecard it will continue to happen, people will continue to invest in a
scam Loss of millions of Euros can happen to all of the stake holders and general public and if
truth gets out later EY will no longer be seen as a reputable company and can be accused to have
been meddling with Wirecard and be a part of a criminal investigation to cover up the
irregularities.
Approaches to ethical decision making through analysis of ethical issue.
As the decision make’s current assignment directly reports to Baffin, the essential
approach to ethics and its roots in the philosophy of previous century that focused on the
individual right and choose for themselves. As per the context of human being various from mere
things. People have dignity that is based upon the quality to choose what they will do with their
lives. They have fundamental moral right to have these choices respected. Peoples are not object
to manipulated. It is a violation of human dignity to use people in various ways they do not
freely choose. Include the overall prospective of decisions that are made according to principle in
term of ten commandments or the golden rule consequence approach. That decisions are made as
per the results character approach. In the context of ethical theories and dilemmas, it includes the
consequentialist theories that are primarily concerned with ethical consequences of particular
actions (Lin, Ho and Sambasivan, 2019). Non consequentialist theories that tend to be broadly
concerned with the intentions of the person making ethical decisions about specific. The main
important approach in decision making ultitarian approach it include the action in term of
difficulties or outcomes that gives the advantage or costs to the stakeholders or an individual
level. It strives to accomplish the highest good for the greatest number while developing the least
amount of harm and preventing the greatest amount of suffering. Ethical decision making or
approaches include the various aspects in commercial enterprises in terms of intensity,
organization factors, opportunity and business ethics and evaluation and intentions. An
appropriate ethical decision making covers the overall process for evaluating and choosing the
alternatives in consistent with ethical principles. It is very essential to perceive and eliminate
unethical options and choose the best ethical alternative. The approaches are usually chosen
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unconsciousness. The main source of issues I decision making is the fact the two parties have
choose various approaches and decision make accordingly their results. Turning the organization
systems and ethics that discuss on ethical principle that are very relevant on which decisions can
be made by higher authorities. Justice approach include the individual that opportunity to reflect
the action is fair to the people. Common good approach includes the decisions that action will
take good for themselves and the community. That opens the doors to others question related
type of society that want to become and how accomplish that. Virtue approach includes the
internal values and moral that we strive to maintain and hold into. It reflects the kind of person
that must be due to character (Krajnakova, Navickas and Kontautienė, 2018). To identify the
ethical issues first of all, recognise the issues, identify the problems, consider the appropriate
facts, to determine the possible occurrence, implement the solution in last evaluate and follow
up. It is very essential to create a framework for stakeholders that have an opportunity to engage
in a collaborative discussion. It is also defining the outset of meeting in various aspects of the
process that enhance the transparency, participation and satisfaction. The right work sheet may
be distributed to all the participants and assist to keep the process on track. At the end of the
meeting it summarises each section of the worksheet. It defines the appropriate plan for
communication any decisions that made and give particular individual to acquire next step
(Johnson, Lee, and Ashoori, 2018).
Recommendations to decision maker in case in order to resolve issues.
As in order to resolve initial ethical issues there are certain recommendations that could be
provided to decision maker of case study by which ethical issues could be resolved as an as
effectiveness could be generated (Govindan, Shankar and Kannan, 2018). In terms of case study
various recommendations that could be provided to decision maker in order to resolve ethical
issues are as follows:
 As has been recommended to project managers of EY that they should have to continue
as well as complete their project ring investigation.
 As for reducing punishment associated to EY project managers as a decision maker it is
recommended that they should consider inviting via card in an internal meeting for
explaining chronologies of investigation.
 Decision maker is also recommended to play their duty as an accounting firm for auditing
customer financial statement through integrity.
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 Decision maker is suggested to explain about their investigation and research for having
motive of benefiting sides of wire card awareness in terms of individual operations that
are damaging company from inside (Brown,2018).
 It is recommended to decision maker that they should follow rational employees inside
their workplace in order to understand as well as support to have good motive of
investigation in in order to resolve ethical issues.
CONCLUSION
From above report it could be concluded that social responsibility is considered to be an
obligation along with commitments of managers which are required by them in order to protect
as well as enhance welfare of society along with improving interest. As this report explains about
managerial social responsibility in terms of ethical analysis of a case study that determines and
explains about different facts that are carried as an ethical issue. This report explains about
decision maker that identifies conflicting demands that have to accommodate. Along with that
there is an explanation of initial ethical issues that are faced by decision maker in case study also
there are various methods in terms of approaches which are stated for decision making analysis
of issues. In order to summarise report certain recommendations are provided to decision maker
of case study in order to resolve challenges of ethical responsibility that are mentioned in case
study.
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REFERENCES
Books and Journals
Gong, G., Xu, S. and Gong, X., 2018. On the value of corporate social responsibility disclosure:
An empirical investigation of corporate bond issues in China. Journal of Business
Ethics .150 (1). pp.227-258.
Yuen, K.F., Thai, V.V. and Wong, Y.D., 2018. An investigation of shippers’ satisfaction and
behaviour towards corporate social responsibility in maritime transport. Transportation
Research Part A: Policy and Practice .116. pp.275-289.
Verk, N., Golob, U. and Podnar, K., 2019. A dynamic review of the emergence of corporate
social responsibility communication. Journal of Business Ethics, pp.1-25.
Morrison, K.A., Misener, K.E. and Mock, S.E., 2020. The influence of corporate social
responsibility and team identification on spectator behavior in major junior
hockey. Leisure sciences .42 (2). pp.133-151.
Lin, W.L., Ho, J.A. and Sambasivan, M., 2019. Impact of corporate political activity on the
relationship between corporate social responsibility and financial performance: A
dynamic panel data approach. Sustainability .11 (1). p.60.
Krajnakova, E., Navickas, V. and Kontautienė, R., 2018. Effect of macroeconomic business
environment on the development of corporate social responsibility in Baltic Countries
and Slovakia. Oeconomia Copernicana. 9 (3). pp.477-492.
Govindan, K., Shankar, M. and Kannan, D., 2018. Supplier selection based on corporate social
responsibility practices. International Journal of Production Economics, 200, pp.353-
379.
Brown, D.S., 2018. The managerial ethic and productivity improvement. In Classics of
Administrative Ethics (pp. 339-343). Routledge.
Johnson, Z.S., Lee, Y.J. and Ashoori, M.T., 2018. Brand associations: the value of ability versus
social responsibility depends on consumer goals. Journal of Brand Management .25 (1).
pp.27-37.
Chi, C.G.Q., Zhang, C. and Liu, Y., 2019. Determinants of corporate social responsibility (CSR)
attitudes: Perspective of travel and tourism managers at world heritage
sites. International Journal of Contemporary Hospitality Management.
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