The paper "Enterprise and Social Responsibility - Morgan Chase, Northern Rock and Bradford and Bingley and Lehmans Brothers" is a perfect example of a marketing assignment. In the previous decade, ethics in the banking sector has drawn numerous public debates due to its obvious critical role in the sustainability of banks and their relationship with society (Arjoon 2005, p. 3). The headline in recent years has depicted sad news of unethical conduct on banks, particularly the UK and US banks. Recent problems which have manifested themselves composed of financial products mis-selling like complex interest rate and LIBOR manipulation by numerous United Kingdom Retail banks.
Arjoon (2005, p. 3) claims that some of the banks that have been in the limelight because of unethical conduct include Morgan Chase, Northern Rock and Bradford and Bingley and Lehmans brothers among others. Banking experts contend that corporate failure and unconvincing accounting practices have led to weakening the confidence of the shareholders. Identify each of the stakeholders and how they are affected. What are the main harms and benefits in this case for the different stakeholders based on the current situation? In the recent time, to be precise 2013, Chase Morgan was one of the banks that has been fined with unethical conduct due to poor culture and lack of control after its shareholders lost up to $4 billion.
Also, the company mis-sold financial products and manipulated LIBOR. In the situation, Stakeholders were adversely affected by Chase decisions Morgan’ s policies, operations and decisions. Some of the stakeholders that were affected consist of employees, customers, creditors and government. In the Northern Rock case, the customers’ shares reduced to valueless and ownership was diluted because of the Government getting a minority stake.
Customers also lost confidence in the banks and drawn their credits as a sign of protest. Employees were also affected by the unethical conduct because they depend on the work for income (Thompson & Cowton 2004, p. 201). Staffs not in the money-making ranks held a majority interest in operating in an atmosphere which provided job security. These staffs had an emphasis on operating in positions which provided rewarding tasks while offering the pleasure of understanding there may be a stable job (Deckop 2006).
Nevertheless, after the scandal had erupted, they were not sure of their jobs. Actually, the company layoff some staffs to offset its losses it had incurred due to the London whale. Due to the lack of risk assessment, depositors lost much of their savings. The housing sector was severely affected forcing the government to intervene and rescue mortgage broking companies. Customers who had acquired loans and mortgages were adversely affected cold not sell their house due high. 1.2 From a utilitarian perspective, would you argue for or against the proposed tightening of UK banking regulation? Analyzing it from the utilitarian perspective, I would argue for a proposed tightening of UK banking regulation.
This is because the major emphasis of utilitarianism is maximizing utility. Bredeson (2011) argues that in business ethics discipline, the utility is best explained as the intention to get maximum happiness while reducing the suffering level. It implies total pleasure for the bank and public, in general, has to be the major aspect of decision making (Joanne 2009, p. 3). In a business perspective, the management action at Chase Morgan is totally unethical.
Due to risky trading, a large amount of money got lost, hence making the banking management unhappy. Additionally, extensive effects of the scandal made several people across the globe unhappy. If the business would have benefited the bank then the utilitarian perspective of morality would have been contented (Bredeson 2011).
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