As the turn of the 21st Century evolved, it appeared as if Adelphia Communications Corporation was on a direct path of success; unbeknownst to their investors and the public, they were in reality on a direct path of destruction instead. Unfortunately, Adelphia is not the first major company in the history of the United States’ business world to lose the trust of the American public, but it is certainly one of the most notable ones to do so. As the events surrounding the Adelphia scandal unfolded in full view of the public eye, a multitude of media outlets were there to broadcast the destruction and distrust to the masses leaving many wondering if the term “business ethics” was actually nothing more than just an oxymoron. Throughout this paper, we will discuss the events surrounding the rise and fall of the Adelphia Communications Corporation and identify two of the ethical problems associated with the scandal while applying them to the deontological framework and Immanuel Kant’s Categorical Imperative.
The Adelphia Scandal
The year is 1952 and a young John Rigas purchased a cable company for a mere $300 in Coudersport, Pennsylvania with high hopes of building the company into a successful family owned and operated business (AICPA, 2005, para. 3); a business that would remain unparallel to the rest of its competition. In the late 1990s his dreams came to fruition; John Rigas, along with a few close family members and investors, purchased Century Communications for $5.2 billion and merged the companies together becoming the 6th largest cable company serving more than 5.6 million subscribers (AICPA, 2005, para. 4). Ensuring that the majority of Adelphia’s voting stock and control of the board remained in the hands of f...
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...ournal, 24(2), 183-203. Retrieved on November 19, 2013 from http://search.proquest.com.ezproxy.trident.edu:2048/ docview/274702092/141F1B825272DA090E0/1?accountid=28844. Markon, J., & Frank, R. (2002, July 25). Adelphia officials are arrested, charged with ‘massive’ fraud – three in the Rigas family, two other executives held, accused of mass looting. The
Wall Street Journal. Retrieved on November 19, 2013 from http://search.proquest.com. ezproxy.trident.edu:2048/docview/240552483/141F2C0F469AD5ECC1/2?accountid=28844. Pecorino, P. A. (2000). The categorical imperative. Retrieved on November 16, 2013 from http://www.qcc.cuny.edu/socialsciences/ppecorino/intro_text/Chapter%208%20Ethics/ Categorical_Imperative.htm
Sevenoaks School. (2011). Deontological ethics. Retrieved on November 22, 2013 from
http://www.sevenoaksphilosophy.org/ethics/deontology.html
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The first blatant ethical issue in the Adelphia scandal stems from the idea that the Rigas family used corporate money for personal use. Nearly $12.8 billion was used to start construction on a personal golf course on their own private land and even more to cover the expenses of the use of the company aircraft for personal reasons. The use of this money was then hidden thro...
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Do you agree with Schmeltekopf that business schools are not preparing students well for the for the ethical challenges they will face in the workplace? Why or why not?
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Thomas, L. L., & Litman, B. R. (1991). Fox broadcasting company, why now? An economic study of the rise of the fourth broadcast `network.'. Journal Of Broadcasting & Electronic Media, 35(2), 139.
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