AFM131 Lecture Notes - Lecture 13: Bernard Madoff, Triple Bottom Line, Invisible Hand

• School: University of Waterloo
• Department: Accounting & Financial Management
• Course: AFM131
• Professor: Bob Sproule

Document Summary

Legality is laws we have written to protect ourselves from fraud, theft, and violence. Ethi(cid:272)s refle(cid:272)ts o(cid:374) people"s proper treat(cid:373)e(cid:374)t (cid:449)ith o(cid:374)e a(cid:374)other. Ethics: standards of moral behaviour; behaviour that is accepted by society as right vs. wrong. Compliance-based ethics codes: preventing unlawful (outside standards laws and regulations) behaviour by increasing control and penalizing wrongdoers (avoiding criminal misconduct). Lead by lawyers and done through education, reduced employee discretion, etc. Integrity-based ethics codes: defi(cid:374)e orga(cid:374)izatio(cid:374)"s guidi(cid:374)g (cid:448)alues, (cid:272)reate a(cid:374) e(cid:374)(cid:448)iro(cid:374)(cid:373)e(cid:374)t that supports ethically sound behaviour (responsible employee conduct), and stress a shared accountability among employees, conform to outside standards (laws and regulations) and chosen internal standards. Lead by managers with the aid of lawyers and others. Done through education, leadership, accountability, decision processes, controls and penalties, etc. Lead by ethics officer: whistleblowers: people who report illegal or unethical behaviour, external stakeholders must be told about ethics program, ethics code must be enforced.