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Article Critiques: Financial Managers with Ethical Stress and Competition in an Increasingly Crowded Marketplace
Financial Managers with Ethical Stress
Financial stress and pressure can be an ethical stressor, like the demand for special treatment; budget involvement and political pressure can all give into the idea that financial managers are under stress. “Financial managers do not work in an ethical vacuum; they respond to supervisors who encourage ethical action and to coworkers who demonstrate high standards of personal integrity” (Gerald, Samuel & Rabin, 2005). Whether good or bad they are put into a precarious situation by their peers because money is always a tempter. Also being in charge how money is handled gives pressure to the position financial managers are put in. Typically when money in involved there is a need for perfection and impartiality.
Unfortunately there is demand that special treatment is needed especially from people outside of their actual unit for special treatment within their own work unit. This comes from the idea that others can exploit their friendships or close working relationships. “Public managers engage in certain financial activities in work environments that produce ethically stressful situations caused by undue political pressure and demands for special treatment” (Gerald, 2005). While yes, relationships have to be cultivated, they also need to be self-serving specifically only to the company. Financial managers are constantly being pulled between making factual and impartial decisions and fostering relationships without opening up to be used.
Part of the pressure comes forth from the political influence that financial managers wield. “Their reliance on political actors for jo...
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...y is something that is a realization of today. Companies are merging and also shrinking the employment pool making the financial manager’s position precarious. Competition as high as it mean that each financial managers needs to play the political game seamlessly balanced with working very strategically bound with in the ethical guidelines.
Reference Page:
Alpert, H. (1999). Manager roundtable: The competitive edge; three managers discuss competition in an increasingly crowded marketplace. Bank Investment Marketing, , 1-
37. Retrieved from http://search.proquest.com/docview/209375253?accountid=32521 Gerald, J. M., Samuel, J. Y., W, B. H., & Rabin, J. (2005). How financial managers deal with ethical stress. Public Administration Review, 65(3), 301-312. Retrieved from
http://search.proquest.com/docview/197178039?accountid=32521
The purpose of this paper is to provide a summary of the article called “Can We Keep Our Promises?” by Robert D. Arnott, and to help better understand the three key risks facing each investor.
Ethics plays a vital role in developing accurate and high quality financial statements for management, financial institutions, and investors. As management utilizes financial statements to make decisions regarding the operations of the business, it is necessary to review accurate financial statements to make strategic decisions about the future of the organization. Investors and financial institutions require accurate financial statements to make informed decisions upon whether to invest funds into the organization or the wisdom of lending funds to said organization.
Berk, J., & DeMarzo, P. (2011). Corporate finance: The core, second edition. (2nd ed.). Boston, MA: Prentice Hall.
Not only were millions of Americans been put out of work due to these manager’s actions, the American financial markets themselves were pushed to the brink of collapse. Despite the fact that the global financial markets, in reality, are not perfectly efficient, there is a corrective mechanism built into the day-to-day trading in the market. When prices are driven down by large sells, either by large investors or a movement in a stock, there are usually new buyers for these stocks at the cheaper price. Managers of...
...f-regulate? A reasonable case for increased regulation can be made given the massive cost of recent financial turmoil and attorneys’ ostensible role in these crises. Moreover, as lawyers effectively operate as gatekeepers and rubberstamps for much of business decsionmaking, they may serve as the most efficient risk bearer to reduce externalized costs, whether through a division of ethical responsibilities between in-house attorneys and independent firms or simply staying the drastic course of Lawson. This modification of the role of attorneys does present a difficult contradiction as the exact value added by lawyers is leveraged into a social duty and it’s not obvious whether the two can co-exist. Given the relative lack of traction and progress, however, it seems the stickiness of established behavior may present too much value, for attorneys and clients alike.
Ethical behavior is behavior that a person considers to be appropriate. A person’s moral principals are shaped from birth, and developed overtime throughout the person’s life. There are many factors that can influence what a person believes whats is right, or what is wrong. Some factors are a person’s family, religious beliefs, culture, and experiences. In business it is of great importance for an employee to understand how to act ethically to prevent a company from being sued, and receiving criticism from the public while bringing in profits for the company. (Mallor, Barnes, Bowers, & Langvardt, 2010) Business ethics is when ethical behavior is applied in an business environment, or by a business. There are many situations that can arise in which a person is experiencing an ethical dilemma. They have to choose between standing by their own personal ethical standards or to comply with their companies ethical standards. In some instances some have to choose whether to serve their own personal interests, or the interest of the company. In this essay I will be examining the financial events surrounding Bernie Madoff, and the events surrounding Enron.
...company workers being affected by the financial crisis. We don’t want to point fingers here only assess the ethical dilemmas that these companies face. Subjective human judgment opens up for the possibility of undesirable human biases and manipulation. However, with or without human judgment, financial models of credit risk are subject to manipulation, both legally and fraudulently.
With Jacob’s financial pressure, his integrity is shaken because he wants to use the money to pay off the bills and Jacob did not mention it to Krystal. Jacob needs to put his personal matter aside and communicate his medical situation and the bonus money to Krystal. By doing so, Jacob will maintain his honesty and not let his personal interest be in the way resulting trust within the workplace will be maintained. Additionally, the bonus money can be fairly divided between the two. Employees have the responsibility to follow and maintain business ethics and the code of ethics in the workplace. Employees have to be honest, communicate at all levels of the organization, deal issues at the lowest possible level, and avoid conflict of interest that would lead to unethical decisions. Also, employees should be educated with the policy and regulations set by the company in order to maintain ethical practices in the workplace. Jacob and employees in general are bombarded by ethical issues and by abiding by their roles and responsibilities will guide them in making an ethical decision. The following five-step model can help employees make appropriate decisions when faced with an ethical dilemma. First step is to recognize the issue. Knowing what is the root cause and the main
Gosling, J. and H. Mintzberg (2003). "The Five Minds of a Manager." Harvard Business Review (November 2003): 1-10.
Block, S. B., & Hirt, G. A. (2005). Foundations of financial management. (11th ed.). New York: McGraw-Hill.
Never have I ever climbed a mountain peak. As a child, I imagined myself conducting expeditions in deep-frozen pathways, leading amateur explorers to the top of the world, and instructing rookies in surviving harsh blizzards. Even though slightly altered, my childhood dream has been achieved. I led a team of fellow classmates, in my Strategic Management course, to the success summit of a financial competition. Over the course of a semester, I and my teammates were supposed to create and manage a company of the IT industry, in a computer-simulated environment, along with other four rival teams. I dealt with strategy and financial matters of our virtual enterprise, while my colleagues were working on marketing and manufacturing. During the four months of the exercise, I have experienced finance from various aspects: capital budgeting, through selecting favorable investment for upcoming quarters; debt management, by assessing the necessary amount and efficiency of loans; profitability analysis and dividend policy, which had been used to compile the company’s general performance index. Working in a multinational team, which included an American, a Norwegian and a Moldovan, strengthen my negotiations skills, as well as flexibility and cooperation. But above all, this experience intensified my passion for finance. Of course, a pleasant bonus was the fact that, in the end, our company’s financial performance was six times the performance of second-best team.
OLLIER-MALATERRE, ARIANE; ROTHBARD, NANCY P.; BERG, JUSTIN M. Academy of Management Review (Oct2013), Vol. 38 Issue 4
I am currently majoring in Finance Management. Most of the time people think of finance as just managing money. However, finance is needed for so much more! The finance industry deals with starting businesses, developing new products, expanding markets, as well as everyday things like saving for retirement, purchasing a home, and even insurance. The stock market, asset allocation, portfolio analysis, and electronic commerce are all key aspects in finance. In this paper, I will explain how these features play a vital role in the industry, along with the issues that come with these factors.
The study concludes that triggering self interest based on money leads to unethical behaviour. In fact, this correlation that money corrupts is supported in many articles including Stella and Willer (2014) who have suggested that the impact of money is so influential and effective that people will act unfairly or will take advantage of circumstances to ensure it is theirs. At the same time, thinking about money and its effects can be the leading contributor to stress. The American Psychology Association‘s recent surveys in America have concluded that matters regarding money are a major influence of stress (American Psychology Association, 2014). It has been concl...
This paper will define and discuss five financial theories and how they impact business decisions made by financial managers. The theories will be the Modern Portfolio Theory, Tobin Separation Theorem, Equilibrium Theory, Arbitrage Pricing Theory (APT), and the Efficient Markets Hypothesis.