Ethics Article Review Newspaper (Revised)
School of Phoenix
Walter L. Lambert
January 1, 06\
A study completed between Motorola and Ericsson on the rendering of Company Ethics and the transformation inside the corporations following a implementation of the Sarbanes-Oxley Work of 2002, looking at numerous ethic theories, such as stockholder theory, stakeholder theory, and legitimacy theory.
Since the Sarbanes-Oxley Act, that has been enacted reacting to the Enron and WorldCom collapses and designed to restore confidence and maintain integrity in businesses. Companies are to disclose in the event that they have a code of ethics. Under the guidelines, a company must disclose whether it has followed a code of values that relates to the company's principle executive expert, principle economic officer, main accounting officer or control, or person performing comparable functions.
The stockholder theory suggests that businesses are responsible simply to shareholders, and all sorts of the employees' actions are directed toward maximizing shareholder wealth with no breaking the law. Manager's act as brokers to the stockholders, the business can have no interpersonal responsibility (Hasnas 1998).
The legitimacy theory is actually a generalized belief that the activities of the firm are appropriate or ideal within a provided social program (Lehtonen, 2003). Legitimacy theory holds that companies are continuously attempting to make certain that their operations fall within the norms with their societies.
Additionally, it relies after the notion of the social contract and on the maintained supposition that managers will choose strategies that show culture that the business is trying to comply with society's expectations. Actions and demonstration are the two dimensions within an organization's efforts to gain legitimacy.
The Stakeholder theory suggests that organizations are responsible to shareholders, yet also that they are really responsible for all individuals, group, etc ....
Sources: Ericsson, " Ericsson Code of Organization Ethics and Conduct. " November 23, 2003. WEB ADDRESS
Hasnas, John. The Normative Theories of Organization Ethics: Tips for the perplexed.
Lehtonen, J. University of Jyvaskylan. 2003
Motorola. Motorola Code of Organization Conduct. Nov 23, 2003
College or university of Phoenix 2006 вЂ“ Albrecht, Stice, Stice, Swain