Chapter 4. Ethics. Although ethics in business has been an issue for centuries, today there are numerous examples of corporations and individuals who have run into legal and financial trouble due to their questionable ethics. | Chapter Ethics Although ethics in business has been an issue for centuries today there are numerous examples of corporations and individuals who have run into legal and financial trouble due to their questionable ethics. Martha Stewart is an example of an individual whose ethics have been called into question. The accusation that she lied when asked if she participated in insider trading a violation of Securities and Exchange Commission SEC regulations brought her to court and made her the center of a negatively charged media frenzy. While she is accused of committing the violation with her personal investments the question of character has already cast a shadow on her business. She stepped down from her role as CEO of her company Martha Stewart Living Omnimedia Inc. and Kmart which carried her brand-name products is bringing a lawsuit against her. This is a clear situation where ethical standards whether it is the individual representing the company or the company itself are tied to the company s bottom line. ENRON An example of a company that committed serious ethical violations was Enron the energy trading company. In 15 years Enron grew 57 TLFeBOOK PEOPLE MANAGEMENT AND POLICY to be one of the largest companies in the United States with more than 20 000 employees in over 40 countries. But by December of 2001 it became clear that Enron was involved in a huge accounting scandal the ramifications of which were the largest Chapter 11 bankruptcy filings in . history and subsequent government hearings were conducted to evaluate just how severe the wrongdoing was. As a result of Enron s deceptive accounting practices thousands of Enron employees lost their retirement savings while several Enron executives received multimillion-dollar bonuses. WORLDCOM The largest financial fraud in . history began to unravel WorldCom in 2002. WorldCom had overstated its income by more than 9 billion by means of its misleading accounting practices and the CEO at the time was .
