Ethics are part of a person's behavior. It also includes all the human values such as equality, human rights etc. Ethics is a study that helps a person in choosing right or wrong. It is a set of principles that help a person to choose the right behavior in his daily life. It basically helps to differentiate between right and wrong, good or evil etc.
In the provided case, there might be a golden parachute agreement between person H and the company for a severance package of $40 million in cash and stock options or the company might have been liable to pay this amount to person H. Here, golden parachute agreement is an agreement between the employee and the company specifying that employee will receive a certain sum of money at termination. This clarifies that corporate governance is apparent.
If the company appoints an officer who is more ethical and have proper knowledge relating to laws then this would result in lesser cash and stock options as the officer would be able to find some way of saving the compensation to be paid by the company.
Ethics are part of a person's behavior. It also includes all the human values such as equality, human rights etc. Ethics is a study that helps a person in choosing right or wrong. It is set of principles that helps a person to choose the right behavior in his daily life. It basically helps to differentiate between right and wrong, good or evil etc.
In the provided case, even if the company found no evidences of sexual harassment but still it wanted person H to step down because the board wants to re-gain its security. Person H, by concealing the private dinners and by falsifying the expense reports has cheated the company. This affected the relation between the company and person H. Now, it would be difficult for the company to trust H as he had already concealed a number of facts. Thus, the board made the decision to remove person H from the company's personnel.
Code of ethics refer to the principles that guide professionals to undertake business actions that are ethical and appropriate. These code helps in doing business with honesty and integrity.
The following are the four key items in a code of ethics :
• Code of ethics describe the values of a business organization and informs the world about the meaning of ethics as the organization's beliefs and understanding. For example- Code of ethics of an organization can describe transparent and honest way of doing business, and to work for the betterment of a society as a whole. These values of the business firm will get described in its code of ethics.
• Code of ethics describes the acceptable and non-acceptable actions and behavior in an organizational setting. It acts as a guide for employees and other people associated with the firm to undertake only those actions that are considered as appropriate as per firm's policies and philosophies.
• Code of ethics also dictates employees and others in the firm about their actions in specific situations. It guides the employees about their dos and don'ts in specific situations faced by the firm in undertaking business activities, and delivering business obligations.
• Code of ethics also describes the punishments and penalties that employees will be imposed with if they undertake any action that violates the firm's code of ethics. If a firm's code of ethics describes bribery as an unethical action, and if employees get engage into it, then the code of ethics will describe a proper punishment for this action.