Tara Smith
FIN324 Public Relations
June 5, 2007
Ethics term review
When referring to corporate America, ethics is something that everyone wants scarce few expect. Within the lead decade or so, corporations such as Enron, WorldCom, and Tyco have been the of import focus in the media due to unethical practices regarding its accounting practices. oneness would think that these examples put other corporations on the straight and narrow, but in spite of these high profile cases unethical practices static occur, unfortunately MSN Money Website reported another case in 2006.
In October 2006, Chairman and CEO William McGuire stepped down from his position after an outside report found that his option grants were likely backdates. (Washington Post) In a report by the firm that the friendship hire to investigate, stated that there were boosts in the value of the CEOs investment trust options. The options were issued on one day but they were habituated a price as if they were issued a prior day. The dissolve of back dating of stock options is to set the date of the stock when the stocks are at their lowest. Although illegal, the executives that receive the stock as commence of their compensation are provided with higher gains.
As a issue of this illegal activity, millions of extra dollars goes in to the pockets of the executives. The report found that the company had failed to ensure such practices were avoided. (bizjournals.com, 2006)
In light of this situation, it was discovered that William McGuire was not the only executive involved, in addition to McGuire resigning, William Spears, a part of the boards also resigned and the general counsel and Secretary David Lubben announced his retirement.
In reviewing this article it is clear that this violation of ethical practices did solely wait on Mr. McGuire. For a general counsel and a piece of the compensation committee to be involved this violation ends at the top...If you want to get a full essay, order it on our website: Orderessay
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