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How Ethics Fades - Essay Example

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Summary
The author of the following paper casts light upon the idea that the modern world with all its advanced technologies is now facing more crimes than ever, with the computers, cell phones and other devices used as vehicles in committing crimes never before imagined…
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How Ethics Fades
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Extract of sample "How Ethics Fades"

When Ethics Fades “The love of money is the root of all evil” is a popular verse from the Bible that warns people not to overindulge one’s self with it. The modern world with all its advanced technologies is now facing more crimes than ever, with the computers, cell phones and other devices used as vehicles in committing crimes never before imagined. The rise of the availability and developments of technology is not only leading to the discovery of what could man still do to make things easier for him, but it is also giving crooked minds to devise schemes in amassing money for themselves. The stock market is one of the businesses where humungous amounts of money are being discussed and this is probably where temptation is the greatest, putting the business world at risk and eventually, the nation’s economy. To control such activities, the Securities and Exchange Commission (S.E.C.) was established to put into completion rules and regulations protecting the government, investors and public alike (www.sec.gov). The story of Raj Rajaratnam is an action-packed non-fiction that brings audiences to a glimpse of how the S.E.C. functions. Rajaratnam is the founder of Galleon, a multibillion hedge fund, who hired employees illegally, who were working in potential companies to get information from them. Among these people who played important roles in the game of Rajaratnam was Anil Kumar, a senior executive of McKinsey, a consulting firm which wanted to get Rajaratnam as a client. Meeting at a charity event in 2003, the two being former classmates made a deal about how Kumar was to be paid by the billionaire as an adviser. Kumar was not the first nor the only one of Rajaratnam’s informer, though. Names like Adam Smith, Krish Panu, Kris Chellam and Rajiv Goel were in the Galleon’s head’s list, all Indian-born businessmen with prominent positions in large companies. Paying them a good deal of money, their services were at Rajaratnam’s command, making him escape the loss of great amounts of money or the gain of it. When his investments are at a risk, Rajaratnam was informed and he sold his shares before a company closes down. Likewise, he is advised on what to buy at very low prices in accordance to the information given him by his ‘advisers’. Whatever occurs, he is always on the win with his dealings (Packer). Insider trading is the name of Rajaratnam’s game, getting information from insiders for his benefit, making sure he always makes money in his investments and he may not be the only one who is doing the practice but his large company just could not escape the suspicious eyes of the S.E.C. Formerly, S.E.C. was looking into Sedna Capital, a hedge fund run by Rengan Rajaratnam, the billionaire’s brother who was tipped off engaging in insider trading. An anonymous letter sent in 2007 about Galleon strengthened S.E.C. official’s suspicions and their investigations begun. Gathering all the necessary people with their respective expertise, the hunt for evidences turned into a drama that soon proved productive. Rajaratnam was arrested in 2009, was tried and then found guilty of fourteen counts of securities fraud and conspiracy to commit securities fraud in May this year. Kumar was arrested and after pleading guilty, he was made the government’s lead witness. Forty seven conspirators were arrested where almost fifty percent of them pleaded guilty, an achievement that is quite a task to be applauded, jailing the first among such crimes (Packer). The details in the events of the crime is overwhelming and one could just wonder how highly educated businessmen would sacrifice their reputations for such a dirty job. The love of money; could it really be the root of all evil? As the United States Attorney for the Southern District of New York, Preet Bharara said, “it wasn’t committed by people with a violent outlook or a bad upbringing, or by serial lawbreakers who knew no other life.” The criminals were educated in reputable schools who are rather perceived as good students as to have taken such high positions in big companies. The first sin that they probably committed before engaging in such a crime is loving money. As Kumar claims, he was at first quite reluctant to Rajaratnam’s offer but half a million dollars for a year is simply irresistible. He showed signs of holding ethical values when he first met with Rajaratnam who offered him the deal saying McKinsey does not allow outside consulting but the latter probably knew just how to get a nod from his prospective assets. He boosted the morale of Kunam and finally got the answer he wanted that he knew would make his pile of money higher. Ethical fading is one dilemma the business world now faces. More and more people are getting into thinking that an activity is just but okay because many others are engaging in them as well without being imprisoned, if not caught. When one is known to be doing a dirty business, he is not condemned anymore but those who are aware of it just shrug their shoulders and think that everybody anyway, is doing the same things. This leads them into doing the same things later, sometimes unconsciously. The article entitled “Stumbling Into Bad Behavior” points out how crimes could be committed by the least expected personalities, tracing it back to being too busy focusing on organizational goals like quarterly earnings or sales quota that eventually fade away the ethical aspect of one’s decisions (Bazerman & Ternbrunsel). This reflects that extremely indulging one’s mind in concerns that will take off good characteristics will soon spoils one’s attitude. Probably the solution that should be considered in such a situation is to balance activities, engaging one’s self in things that will make an individual keep his ethical values in check. The aforementioned article explains the ethical concept further through a study in 1999 where participants played the role of manufacturers who under pressure from environmentalists. They were informed that they need a costly agreement that would limit toxic emissions and a part of the group were warned of being sanctioned if they break agreements while the rest were told they will not be punished if even if they break the agreement. One’s normal expectation would be, those who were warned with punishments will be careful enough not to break the agreements while those who were given leniency would be reckless and not mind if they break a rule or two. However, quite the opposite was the result. The study showed that those who were threatened with punishments broke the agreement more than those who were not given sanctions. (Bazerman & Ternbrunsel). The point being made here is that, those who were sanctioned decided upon their actions on view of the financial aspect, making more money while they can and worrying about the sanctions later, if not forgetting about it altogether. In a similar study on students who were given the roles of buyers, sellers, buyer’s auditor and seller’s auditor; to estimate the value of a fictitious company’s value, auditors estimated a higher value than sellers, incorporating information that would justify the price. The same test was applied on real auditors which resulted in a similar result (Bazerman & Ternbrunsel). To Bharara, the concept is simple. To do the right thing, he says, one needs to consider what is right over what is wrong. However, when such is not possible, an individual has to bear in mind that when choosing to do the wrong thing, the consequence would most probably be a life behind bars (Packer). Behind every action, there would always be a thought that would bug a person when he decides to go against what is just, only to earn a handsome amount of money. From the story of Rajaratnam, people should be warned that there is no such thing as “too big to fall” because after all, crime does pay. In a world where ethics is adulterated with of the thought of having more integrity than another because one’s faults are lesser than the other, it seems to be a normal thing to see all kinds of cheating and no one bothers to be ashamed about it. In fact, Bazerman and Ternbrunsel claim that most actually view themselves to be of high integrity despite knowing that they do things that are against the law or the rules and regulations of an office or a company. This probably is a result of looking into other people’s integrity and comparing one’s self to others, deciding that one is better than the other. Moreover, an individual might think that he is not as different from the other, suffering his integrity over being equal or better than his colleagues according to his perceptions, creating ethical fading. With the aforementioned conditions, it is important that a body is existent to look into such matters so that appropriate actions may be taken, to control, if not to eliminate the dilemma of ethical fading. As the S.E.C. attends to its responsibilities, individuals should also take the effort of re-aligning one’s values. Employers or companies should also extend help to employees as Bazerman & Ternbrunsel suggested, that, auditors should only audit and not sell, to protect not only the customers but also the employees, from doing things that will degrade them and the company they represent. Surely, for every problem, there is always a solution. Solutions that will work if one is serious in considering making the best efforts to maintain one’s integrity as he works in a reputable office. References Bazerman & Ternbrunsel. Stumbling Into Bad Behavior. The New York Times: The Opinion Pages. April 20, 2011. Web. November 16, 2011. . n.a. Implementing the Dodd Frank Wall Street Reform and Consumer Protection Act. U.S. Securities and Exchange Commission. November 4, 2011. Web. November 16, 2011. . Packer, George. A Dirty Business: New York City’s Top Prosecutor Takes on Wall Street Crime. The New Yorker. June 27, 2011. Web. November 16, 2011. . Read More
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