Corporate Governance and Ethics in Organizations

TOPIC: CORPORATE GOVERNANCE AND ETHICS IN ORGANIZATIONS

NAME OF PAPER: INDIVIDUAL PAPER

CORPORATE GOVERNANCE AND ETHICS 2

SUMMARY

While there are merits to the assertion that a certain degree of corporate governance and ethics plays a vital role in ensuring financial prosperity, there is however a lack of consensus as to the extent to which regulatory bodies should influence the adoption and implementation of rules and regulations geared at improving the appalling level of corporate governance and ethics that unfortunately has in the recent past become the norm rather than the exception with businesses the world over. I intend over the course of this paper to elaborate on the role played by corporate governance and ethics in facilitating a business climate that encourages and promotes economic stability as well as prosperity. In addition, the paper present and elucidate on regulations that have been adopted in the United States with the goal of making dire improvements to the modus-operandi that contributed in plunging the United States’ economy into financial disarray, as well as obstacles that have and are preventing the integration of corporate governance and ethics as an integral part of the structure of U.S. companies.

CORPORATE GOVERNANCE AND ETHICS 3

CRITICAL ANALYSIS

Corporate governance has been aptly defined as the system of checks and balances, both internal and external to companies, which ensures that companies discharge their accountability to all their stakeholders and act in a socially responsible way in all areas of their business activity (Sison, 2008). While ethics on the other hand, can be defined as a set of guidelines and or rules for the conduct of individual behavior in an organization or civil society (Clements, 2010).

While it is absolutely certain that the recent economic mayhem that threatened to severely undermine the U.S. economy in particular and that of the world in general, can be attributed to a plethora of factors, however, it would be naïve to deny that a dearth of exemplary corporate governance and ethics did not significantly contribute to the economic crisis the United States was exposed to at the end of 2007. Despite the fact that the lack of adequate rules and regulations failed to deter or in some cases inadvertently encouraged an unprecedented level of corporate greed which provided corporate management with an impetus to disregard ethical consciousness in the quest for profitability (Rinzinwangmo, Fengming, & Flavel, 2009). In fact,