Download Business Ethics Read the article Governance in the Spotlight: What

Business Ethics
Read the article Governance in the Spotlight: What Sarbanes Oxley means to You. In this article
the author outlines provisions companies are now required to implement. Consider the
requirements imposed by Sarbanes Oxley on corporate boards of directors. Do small businesses
and privately held companies have ethical duties? If so, to whom would they owe this duty?
Employees? Customers? Vendors? Should the law impose ethical requirements on small
businesses or privately held companies or can the marketplace police unethical business
behavior? Provide support to justify your position.
What Sarbanes Oxley means to me? The Sarbanes-Oxley Act means that there is law in place,
intended to protect investors and renew public trust in corporations and their boards, from
conducting fraudulent business. It requires check and balances; it mandates that management
must now individually certify the accuracy of financial information. It set the stage for severe
penalty to those who engage in fraudulent financial activity.
Do small businesses and privately held companies have ethical duties?
Yes they are supposed to because the Code of Ethics and business standards sets out the
minimum ethical standards, which organizations must adhere to when conducting their affairs. It
should not matter if the organization is privately owned or a small business.
If so, to whom would they owe this duty? Employees? Customers? Vendors?
They owe this duty to the employer, employees, customers and vendors. Everyone should be
treated equally and fairly and with dignity and respect. In order for an organization to be
successful it must be built on the understanding of the organization’s values, beliefs, goals,
objectives and constraints. Paying bills and employees on time is a very good ethical habit to
have and it helps to foster a healthy and honest climate.
Should the law impose ethical requirements on small businesses or privately held
companies or can the marketplace police unethical business behavior? Provide support to
justify your position.
Most provisions of the Sarbanes-Oxley Act apply only to publicly hold reporting companies.
However, some of its terms reach beyond publicly held companies. Most of SOX' attention was
initially focused on public companies, it did impose two little-noted provisions on all
corporations, whether nonprofit or for profit (public or private). The two requirements are:
a. Destruction of documents: SOX makes it illegal to destroy or alter a document to prevent its
use in a legal action, such as a federal investigation.
b. Protection for whistle-blowers: Sox makes it illegal for corporations to retaliate against an
employee who reports a suspected illegal action by the employer.
Laws are needed in place to keep everyone honest. People runs organizations and there are
people who will teach and preach to other about the Code of Ethics, but will never adhere to it
because they feel that they have mastered the “manipulation behavior”. I worked in Equal
Opportunity Staff Office with one of the highest enlisted rank Noncommissioned officer who
violated the military code of ethics and was forced to retire from his position. For a very long
time he manipulated us and cheated the system, but he eventually got caught. I believe that
people should do the “Right Thing” at all times especially when no one is watching.
Reference
Orlikoff, J. E., & Totten, M. (2004). Governance in the spotlight: What the sarbanes-oxley act
means for you. Trustee, 57(8), 15-8. ProQuest Document ID#204910965