Business Ethics Essay Example | Topics and Well Written Essays - 1000 words - 4

Business Ethics - Essay Example It is now again trying to sell itself inviting offers from Qwest and Verizon, both of who are also recovering from debts. They are trying to outbid others and making promises which they may not be able to maintain as business deteriorates. This is again a matter of concern because ethics are compromised under such circumstances. The Corporate Governance norms were violated at WorldCom, which is unexpected of the Directors and the CEO. Over ambitiousness of the CEO to acquire several companies with the stocks of WorldCom led him to boost the company’s profits artificially by as much as $3.9 billion (Bhattacharya, 2004). Costs were considered as capital investment which helped the company to sustain its apparently smooth and rapid earning growth. They even claimed depreciation of the ‘capital investments’. The behavior of the CEO and the CFO were the driving forces behind the unethical conduct. The CEO utilized the company loan of $400 million to buy ranches and other personal properties, which is unethical. He used the services of the CFO to ensure rising stock prices so that his personal stake would provide the security for the loan. They hid the information from the external auditor. Additionally, the big names in auditing and accounting have failed to detect the irregularities or to gu ide the firms. This would amount to hidden complicity between the auditors and WorldCom. The audit committee did not have a financial expert. Besides, they had the sole authority to appoint, retain, compensate, evaluate and terminate the company’s independent auditors (Petra, 2006). WorldCom had crumbled because of its unethical practices. MCI on the other hand was reputed for its â€Å"integrity, innovation and value† (Thurston, 2007). WorldCom’s name was changed to MCI as a part of the reorganization plan filed in the bankruptcy court in US. According to the executive vice-president, they wanted to re-establish