CODE OF ETHICS Code of Ethics

Code of Ethics
My Personal Code of Ethics
My personal code of ethics is based on the virtual ethics. It puts more
emphasis on the approach to an ethical dilemma rather than the moral
conclusion. The main rationale of the personal code of ethics is to be
good. This means that whether the action is right or wrong is more
important that the cultural relativism, the rules and obligations or the
consequences. Based on this code of ethics, I always try to have a good
character and exhibit moral virtues.
My core values that guide my morality include, but not limited to, love,
freedom and social, economic, professional and personal growth. Love is
the central theme and value in my life. This is why I value my family
and friends. Consequently, I always strive to enhance my interpersonal
skills. I love beautiful things, animals, children and nature. In
general, I love life. Freedom is also a core value that is enshrined
within me. I believe in the value of freedom, that is, physical freedom
and mental freedom. I believe that every body has a natural and inherent
freedom to thoughts and make decisions. This is why a human being is
considered rational beings. My views on freedom enable me avoid actions
that limit other people’s freedom or may undermine my freedom in the
future. Growth is also an essential guiding principle in my life. I
believe in continuous in all facets of life. My professional and social
development is guided by this core value. I always focus on the
opportunities and potentials of growth rather than the weaknesses and
inadequacies. I also believe that I have a responsibility of
facilitating growth and development in others.
I believe I have a good moral character. This is because I have well
defined ethical principles that govern my life. These ethical principles
are based on my family background which instilled basic values and
ethics in my life. My ethical principle dictates that is should always
do what is right. My ethical principles have also enabled me to be a
person of high integrity. In my own view, integrity means being truthful
and reliable as a professional and in the social life. The virtues I
aspire to be include honesty, reliability, trustworthiness, justice and
prudence. To achieve these virtues, I ensure that I adhere to the set
rules and code of conduct in the immediate society. For example, in the
family setting, the values in the family are my guiding principles. I
also analyze all the possibilities in a situation before taking an
action. This way I am able to do justice to all and avoid conflict of
interest. My moral principle fits best in the virtue ethical theory. I
believe in doing the right thing in a similar way I expect others to act
in a similar situation. I am also guided by Kantian principle, since I
believe in moral standards and moral obligation. Being ethical is
valuable in my life because I derive happiness from doing the right
thing. I do not think I could be happy without trying to be ethical
because it is the foundation of social life. For example, it is
difficult to maintain friends if someone of dishonest or untrustworthy.
Also my family background makes it very difficult to be unethical.
A Professional Code of Ethics
The management in corporate organizations has the ethical responsibility
of maximizing the investor’s returns and complying with the internal
and external standards. This is through avoiding conflicts of interests
and building the reputational capital of a firm. It is important for
organizations to have a code of conduct that governs their activities.
There are also national and international business and professional
ethics that guide workers within an organization. For example, accounts
have national and international professional code of ethics and conduct
that governs the accounting profession. The code of ethics within an
organization does not only apply to the junior employees, but also the
top management. However, in the recent past there have been several
cases of negligence by the management and general corporate
irresponsibility. One of the most published corporate irresponsibility
and managerial negligence is the Enron scandal. The scandal evoked
several lawsuits and outrage from stakeholders in the business (Salter,
The Enron scandal was exposed in the year 2001 which resulted into Enron
Corporation being declared bankrupt. Analysts have argued that the
Enron scandal is the biggest audit failure and accounting fraud in the
history of United States. The American energy giant was established in
1985 by Kenneth Lay though a merge of InterNorth and Houston Natural
Gas. The scandal is believed to have started when Jeffrey Skilling was
hired by the company. The executive, under his leadership, used
unethical financial reporting using the loopholes in accounting to hide
huge debts in the company as a result of bad deals and failed projects.
The executive and the financial officer in the company misled the
directors in adopting unethical and risky accounting practices. As a
result, the shareholders in the company lost about 11 billion dollars.
The stock price dropped from 90 dollars per share in the mid 2000 to
below a dollar by late 2001. After a lengthy investigation by the
Security and Exchange Commission, several executives in the company were
indicted and sentenced to prisons. However, the employees and
shareholders were adversely affected by the scandal. Additionally, the
scandal emphasized the need for ethical decision making and prompted the
enactment of the Sarbanes-Oxley Act (Salter, 2010).
The accounting profession is guided both national and international code
of conducts. Accountants in the united states by the AICPA Code of
Professional Conduct. Due to the nature of the accounting profession,
the need to strictly adhere to high standards of ethics is paramount.
The accounting code of conduct requires that accountants should always
put the public interest ahead of their own individual interests. The
main role of accountant professional is financial auditing. In this
regard, accountants have the ethical obligations of giving honest and
accurate opinion on the financial situation of an entity. The management
of organizations is also obliged to ensure that all public companies
publish their quarterly and annual financial reports for the benefit of
shareholders and the general public. Accountants should also provide an
independent and objective financial statement depending on the
information provided by the client. In general, the accounting ethics
emphasizes on accuracy, truthfulness and integrity in financial
reporting (Cheffers & Michael, 2007).
There are two basic strengths of accounting code of ethics. The
accounting code of ethics is relatively uniform in many parts of the
world. Secondly, the code of ethics is legally biding. This means that
accounting professionals are required by law to strictly adhere to the
accounting ethics. The Enron scandal is one of the most serious
accounting scandals in the modern society. For several years, Enron did
not report the true representation of the financial situation of the
company. The audit reports were dishonest and lack integrity. In
addition, the auditors were influenced by the executive to give the
wrong financial evaluation and therefore did not have independence.
According to cultural relativism, what is good or bad is relative to a
particular culture. What is ethical in on culture can be unethical and
unacceptable in another society. Ethical relativism is based of the
cultural relativism which argues that the truth is not absolute, but
relative. Morality is, therefore, as a result of the culture (Wilkens,
2011). Relative to the Enron case, the executive acted against the
morality of the code of ethics that provides guidelines on preparation
of accounting reports. According to the accounting profession code of
conduct, as depicted in the code of ethics, the executive acted
immorally. In addition, not ethical standards, professional, national or
international, can consider the actions to be morally correct. However,
the actions may have been ethical relative to their interpretation of
the situation.
Ethical egoism is dependent on what is considered best for the
individual making the decision in an ethical dilemma. In ethical egoism
or materialism, the main question is what is good for the executive. It
is, therefore, not based on philosophical and ethical inquiry on the
ethical dilemma (Wilkens, 2011). In the case of Enron, the executive
acted according to what they considered being good for them at the
moment. However, if they considered the impacts of their actions in the
long run, their decision was not the best for them. In the short term,
the executive were able to gain the confidence of investors. This was
good for them. However, they were aware of the fact that poor and
unethical practices were against the law. In addition to ending their
career, they were faced with numerous lawsuits and imprisonment.
The utilitarianism ethical principles argue that the end justifies the
means. This means that when faced with an ethical dilemma, the most
ethical action is the one that maximizes happiness. The ethical theory
is based on the fact that the purpose of any human action is to bring
about happiness and good to individuals and society. However, whether
happiness of the society overweights the happiness of an individual is
the main point of contention. The main rationale of the utilitarian
principles is the usefulness and utility of an action. This means that
the happiness of the society is more essential (Wilkens, 2011). In the
Enron case, the actions of the executive did not bring about happiness
to the executive or the shareholders. The shareholders lost their
investment while the executive was sued for their actions. In addition,
the poor and unethical accounting practices destroyed the reputation of
the Enron.
Kantian ethical principles, otherwise know as deontology ethics, takes a
different view of the ethical dilemmas from the ethical relativism and
utilitarianism. Kantian ethics argues that individuals have the duty to
act morally. Kant, one of the greatest thinkers of all times, argued
that there are rules (moral standards) in every society that must be
strictly followed. The deontology ethics disputes the consequentialism
by stating that the outcome of the actions does not delete the moral
duty or obligation to follow the moral standards. This means that the
outcome of an action may be good, but the action is unethical if it was
against the moral standards (Wilkens, 2011). In relation to the Enron
case, the executive did not follow the accounting ethics in their
actions. In addition, their actions were against the basic moral
standards in the society, for example, honesty and integrity.
Therefore, based on general ethical theories, it can be argued that the
Enron executives acted immorally. The executives acted against the
culture and ethical standards of the organization, professional ethics
and morality of the society. Their actions did not bring about any
happiness and were not materially good for the executive. The actions
and the consequences of the actions negatively affected the
organization, shareholders and Enron executive.
Cheffers, M. & Michael P. (2007). Understanding Accounting Ethics. Allen
David Press
Salter, M. S. (2010). Innovation Corrupted: The Origins and Legacy of
Enron`s Collapse. Harvard University Press.
Wilkens, S. (2011). Beyond bumper sticker ethics: an introduction to
theories of right and wrong, Downers Grove, Ill: IVP Academic.