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Ethics of Financial Scandals

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Theory Essay 1
With scandals such as Martha Stewart with ImClone and the Galleon Corporation people’s eyes have opened to the ethical dilemmas and personal self interest that upper management faces in large public companies. This struggle is the difference between whether the public views that person is moral or not. This brings up the question: Which is better, to be a virtuous leader or act in self interest? A virtuous person is someone who either tries hard, and gives great effort or someone who you can count on to do the right thing. The Psychological egoism theory, on the other hand, says that everyone is motivated by self interest. The question is a tough one especially in when the agent is in certain situations.
Many companies give higher up managers bonuses not only in cash, but also stocks. This allows the people who see what the price of stock is probably going to do in their daily tasks and they also have part ownership in the company. This puts them in an awkward position. People that may not be looking to have stock because they could get themselves in trouble with the information they possess now are in this position because of the company. The people that have the information of what stock prices will do don not want stock because it is a conflict of interest. This brings up the point of whether companies giving the employees that have access or have the information about the impact of activities on stock prices stock bonuses. This is a conflict of interest for the employee trying to be virtuous and the self interest of the person. Most would use that information to gain an edge on trading shares. People sometimes find themselves in this conflict unwillingly because of the company. Psychological egoism lifestyle is thought to be unethical compared to the virtuous lifestyle. This is the thought because people find that when you are selfless the…...

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