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"If you lose dollars for the firm, I will be understanding;
if you lose reputation, I will be ruthless."
(Warren Buffet)
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It's probably unnecessary to tell the tales again...
Enron, WorldCom, Firestone, Global Crossing, HealthSouth, Arthur Andersen, Dynegy, Qwest, Waste Management, Adelphia, Tyco, Sunbeam, Coca-Cola, Halliburton...
Indeed, corporate America at the turn of the Millennium was filled with notorious cases of ethical failure. Between 1999 and 2002, we all watched as unprincipled individuals in unaccountable cultures sank (or at least capsized) some great ships of American industry and innovation.
A perception of ethical crisis immediately followed in capital markets, regulatory agencies, board rooms, and the general public.
In 2002, Business Week reported that "opinion polls now place business people in lower esteem than politicians."1 During that same period, an ABC/Washington Post poll found that 75% of Americans expressed "limited confidence in large corporations,"2 while an NBC/Wall Street Journal poll found that 57% believed that "standards and values of corporate leaders and executives had dropped in the last 20 years."3
More recent surveys reflect the continuing trend:
- 80% of Americans think that business is too concerned about profits, and not concerned enough about workers, consumers, and the environment.4
- 77% of senior managers reported observing ethical misconduct in their organizations.5
- 74% of all employees reported that they had "personally seen" or had "firsthand knowledge of" misconduct within their organizations during the prior twelve months.6
- 70% of Americans said that "most businesses will take advantage of the public if they feel they are not likely to be found out."7
Where did this ethical crisis in corporate America come from?
Where does it continue to come from?
Read more: Personal Crisis
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1Jennifer Merritt, "For MBAs, Soul Searching 101," Business Week (September 16, 2002), p. 64.
2Gary Langer, "Confidence in Business: Was Low and Still Is," www.ABCNews.com, September 10, 2002.
3Eric Hellweg, www.Business2.0.com, September 10, 2002.
4Smith, Clurman, and Wood, Yankelovich Partners, Inc., Point, February 2005.
5Ethics Resource Center, National Business Ethics Survey, 2005, p. 30.
6KPMG Forensic Integrity Survey, KPMG International, 2006.
7Smith, Clurman, and Wood, Yankelovich Partners, Inc., Point, February 2005. See also, Ferrell, Fraedrich, and Ferrell, Business Ethics: Ethical Decision Making and Cases, Seventh Edition, Houghton Mifflin Company, 2008, for excellent academic coverage of contemporary issues in business ethics.
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"We have no government armed with power capable of contending with human passions unbridled by
morality and religion. Our Constitution was made only
for a moral and religious people. It is wholly
inadequate to the
government of any other."
– John Adams
 
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