Ethic Level of Big Companies: Wal-Mart's Ethical Issue

Name Instructor Course Date Ethic Level of Big Companies Ethics is the accepted principles that govern an individual’s behavior or how activities are done including how companies operate. The principles determine what is wrong and right with moral duties and obligations. Several large companies globally have faced ethical problems and they have tried various ways to solve the challenges. The ethical problems majorly tarnish the companies’ reputations and reduce their sales and profitability. Hence, in most cases, such companies attempt to hide the challenge they are facing from the outside stakeholders. Therefore, the work covers the best ethical principles that the firms have adopted in dealing with their challenges and the teachings of the church regarding the operations of the companies. Wal-Mart’s Ethical Issue Wal-Mart is the largest US multinational retail shop that operates hypermarkets, grocery stores, and discount department stores. The mission of the firm is to save peoples’ money and raise their social welfare. Most of the products of the company are fairly priced to improve its economies of scale. More so, the company has several branches in over 27 nations and has over 10,700 stores with approximately 2 million employees. Despite the size and reputation of the company, it engaged in an unethical practice that was discovered in 2012 for not abiding by the US and Mexican laws in its operations. The principle requires that companies abide by the regulations, laws, and rules relating to their business operations. In the year 2012, the company was sued for bribing Mexican government officials to allow it open new branches in the nation unlawfully. The firm paid a total of more than 24 million dollars to the officials to be granted the favor of opening the subsidiaries unlawfully which could have cost the company a lot of money if it could have followed the required procedures (Heineman n.p). More so, one of the firm’s CEO decided to rebuke investigators regarding them as being aggressive on the issue after being bribed to do so. However, the chairman reviewed the allegations and decided to continue the investigation. The bribery scandal violated the US and Mexican laws and it greatly tarnished the company’s reputation. The issue was regarded as an accounting fraud because of the direct payments that the firm made to the Mexican officials. Currently, Wal-Mart has accepted the claim and is ready to pay several millions of dollars to solve the problem. According to (Deut. 6:4-5), the Bible states that we should love our God with all our soul and might. The commandment is considered the greatest in the entire Bible. Further, the Bible expounds that the greatest concern that we have with God is by obeying the rules and this also proves that we are in a relationship with him. Similarly, in (Luke 20:25), Jesus explained that ‘’Give Emperor what belongs to him and God what is God’s.’’ The statement means that people should obey the rules provided and pay taxes to the government as provided by the laws. Therefore, Wal-Mart should have followed the rules provided by the Mexican government and pay the money required directly to the government instead of directly bribing the officials. The act amounts to unethical practice which even the Bible does not support. Target Ethical Problem Target is the second largest discount retail store in the US. The firm is a general merchandise retailer that sells commodities through its digital channels and stores. The company sells edited food assortment such as dry grocery, frozen items, and dairy products. Unluckily, the company engaged in an accounting scandal that involved artificially inflating its share prices by 40% to improve its spending and economic activities to avoid being taken over by Wesfarmers. The auditors of the company failed to detect the problem which marked the scandal as one of the major audit failures (Tom 358). Hence, the act amount to lack of accountability which resulted into loss of jobs by its top executives and damage its share prices and reputation. Accountability is considered as one of the ethical principle that should be observed. However, the company failed to hold the value as the auditors failed to detect an issue that a professional with the same competency could have detected. Romans (14:12) states that every person will give an account of himself to God which means that at the day of judgment, every person will be answerable for his acts before God. Therefore, the auditors engaged in an ethical misconduct by agreeing to help the company hide the fact that their shares have been inflated by 40% to manipulate the stakeholders. Every person should be truthful in any activity he or she engages in including when acting on behalf of someone, then such a person should do so in good faith. The auditors have the responsibility to give the true and fair position of a company. Therefore, the fact that they failed to detect a material misstatement that could have been identified by another practitioner will similar knowledge and experience means that they were paid to hide the truth. Hence, according to the Bible the members of the team will be answerable for their deceit against the firm’s stakeholders before God. Volkswagen Ethical Issue Volkswagen is one of the largest companies in the motor vehicle industry. However, the firm engaged in an emission scandal where it released vehicles which have not been properly tested. The vehicles released a lot of poisonous gases into the atmosphere which affected people lives. The aim of the firm was to cheat not testing the cars before releasing them into the market. More so, the firm adopted unethical behavior of training its engineers and managers to be deceitful in conducting the company’s activities (Stanwick, Peter and Sarah 18). The firm controlled its employees and even threatens to dismiss them from their job if they reveal its secrets. Another unethical issue that the company engaged in was less concern for others. The ...