Introduction
Understanding how the choice of an ethical strategy shapes a company’s performance in the global economic setting is central to running a company effectively. Therefore, a study that examines the subject matter, namely, the key ethical provisions that an organization may follow in the global market setting, as well as the opportunities and challenges that it may face in the process, has significant importance for the ability to identify risks in the global economic context and being able to mitigate them. Analyzing some of the latest instances of the breach of ethical standards in the multinational business setting, one should pay closer attention to AMP. Having made a series of controversial and often misleading statements regarding its approach toward charging its customers, AMP has gained quite a shaky reputation.
Specifically, despite the rapid rise to success, AMP has shown reasons for concern due to the problems with its organizational culture. According to the case study, very little attention has been paid to the fact that the organization charges customers for the services that have not been delivered, as well as other financial inconsistencies (APES 110 code of ethics for professional accountants (including independence standards), 2018). As a result, AMP has gained the reputation of a rather shady and untrustworthy company, which should be blamed on the lack of supervision and audits combined with a poorly developed corporate ethical framework. However, by creating an impetus for radical change and establishing clear ethical guidelines, AMP will be able to redesign its current image in the global market, which will create the introduction of Kotler’s Change Model and the
Ethical Issue
In the context of the Libertarian theory, which suggests that autonomy should be prioritized and sought after as the main premise for effective management of ethical concerns, the problems observed at AMP could be described as the lack of the qualities needed for the Libertarian principles to be established in the corporate environment. Namely, the presence of the degree of freedom that entitles staff members and managers to making the decisions that will affect a company’s reputation suggest the presence of corporate social responsibility (CSR). In addition, the integration of different ethical perspectives, including Utilitarianism, Deontology, and Virtue Ethics, should have been considered. Instead, the managers at AMP pursued immediate financial gain, bending the ethical standards in the way that maximized the profits without considering the implications, particularly, legal repercussions and the damage to the company’s reputation. Specifically, the investment platform built for the organization was exposed as a fraudulent endeavor, and the fact that some customers never received the services and products for which they paid was made public.
Key Stakeholders Involved
The case features quite a number of stakeholders, the key ones being represented by the company and its customers. Specifically, the clients that have been affected by AMP’s fraud ca be regarded as the primary stakeholders. In turn, the company and its managers can be defined as another stakeholder group. AMP’s suppliers, retailers, and business partners should be listed as the third category of stakeholders, whereas the global community into which the organization was introduced represents the fourth category of stakeholders.
Possible Impact on the Business
The case of AMP processes the integration of CSR into the corporate ethical framework as direct positive effects on a business. Namely, by incorporating CSR and the related concepts into the workplace, one creates premises for the promotion of other related changes. For instance, with the introduction of CSR in the organizational setting, an HRM manager could also invite a staff member to gain the skills needed to support corporate values. Similarly, organizational philosophy and the associated behaviors would be internalized, leading to a proper understanding of a company’s needs and a more nuanced strategy of implementing organizational goals.
Correct decision: Suggestion and Examples
In retrospect, the company description provided above serves as a perfect foil for the further analysis of the people involved. Therefore, locating other sources of data for this project will be strongly needed. Specifically, to manage the case scenario mentioned above, one should introduce the tools that allow for a more careful and accurate control over the case and the stakeholders in question. Namely, the tenets of the Libertarian Theory suggest that the presence of colonial attitudes signifies about the presence of an inherent conflict, which is why adopting a multicultural approach will eventually guide the organization toward a more responsible attitude (Seneviratne, 2019).
In addition, when being viewed through the lens of the theory of Social Responsibility the issue in question indicates that the problem of the lack of compliance with the existing ethical standards can be managed by shaping the organizational principles and revisiting the code of ethic that the company currently has.
Afterward, the corporate philosophy must be altered so that it could specify directly the importance of transparency and the ethical choice of strategies in the process of decision-making. Finally, AMP will have to publicly acknowledge that it will change it corporate policy toward meeting the needs of all stakeholders and ensuring that the principles of the no harm policies are implemented in its strategy for managing financial issues.
To control the extent of compliance with the new regulations, the owner of the organization will need regular reports being submitted by the staff members. The described evidence will help the organization to improve its reputation, create a more reliable workplace environment, and introduce the ethical decision-making framework that will guide staff members toward honest and effective performance.
Importance of Ethics
Ethics plays an essential role in an organization. It serves to safeguard a company against unfavorable ethical choices, as well as ensure that the ones that the company makes align with its set standards (Buil et al., 2019). Therefore, ethics has huge importance for the participants of the dialogue. Apart from the opportunity to help all to use involved to reconcile, the specified attempt at extending help may not be needed. Therefore, when offering financial and economic support to an individual, checking whether the target person has enough opportunities or purchase the required items and maintain financial and social wellbeing is central to the successful management of risks in the target market setting. Moreover, the choice of ethical principles defines a company’ opportunity to mitigate conflicts and reduce the risks of receiving negative publicity that may eventually lead to the company’s downfall (Yoo and Lee, 2018). Therefore, the choice of the framework that implies greater openness, allows the firm to acknowledge the problems in its security, and implement a positive change is crucial.
Conclusion
Owing to the existence of a vast array of ethical philosophies and viewpoints on ethical decision-making in the global economy and the focus on ethical sustainability combined with the transformational change model offered by Kotter, AMP will need to make an immediate change to its ethical code. Specifically, it will be reasonable for the organization to approach the task of ethical decision-making by creating an amalgamation of the ethical principles that every stakeholder possesses. Thus, a compromise toward ethical decision-making for a multinational organization will be located. Moreover, the acceptance of a multicultural stance in ethical decision-making in the workplace will allow approaching complex ethical concerns that require a multi-faceted assessment. By incorporating the ethical perspectives of all participants and considering the issue form a multicultural stance, one will be able to choose the solution that will satisfy the needs of all stakeholders.
Reference List
APES 110 code of ethics for professional accountants (including independence standards) (2018) Melbourne, Australia: APESB.
Buil, I., Martínez, E. and Matute, J. (2019) ‘Transformational leadership and employee performance: The role of identification, engagement and proactive personality’, International Journal of Hospitality Management, 77, pp. 64-75.
Seneviratne, K. (2019) Myth of ‘free media’and fake news in the post-truth era. Thousand oaks, CA: Sage Publications Pvt. Limited.
Yoo, D. and Lee, J. (2018) ‘The effects of corporate social responsibility (CSR) fit and CSR consistency on company evaluation: the role of CSR support’, Sustainability, 10(8), 2956.