QUESTION 1
The signs of ethical collapse
Many successful businesses operated under a set of normative standards, expected behaviors and
guidelines that are generally accepted by society (Jennings, 2009). That is, businesses operated
under ethical principles that “consist of standards and norms for behaviors that are beyond laws and
legal rights” (Jennings, 2009). These ethical principles are reflected in an organization application of
trust, integrity, fairness and responsibility. In this essay we will be discussing the ethical collapse that
occurs when any organization has drifted from the basic principles of right and wrong.
One of the first signs of an ethical collapse is the pressure to meet the numbers where financial
reports give incorrect figures and reflect what the organisation wants the markets to see. For
instance referring to the given text “In 2017, the Steinhoff share price collapsed by more than 90%,
wiping out nearly R10 billion in shareholder value in about three days,” due to ” alleged massive
accounting fraud”. Secondly we witness Sycophantic executives and an iconic CEO from the given
case study when “the company’s CEO, Markus Jooste resigned after news that German prosecutors
were investigating the company for alleged massive accounting fraud.” This showed that the CEO was
given an iconic status in the media.
We observe weak board in the case study when “Behind all that was the CEO, Leon Kirkinis, who
believed too much in his own abilities, and a board that failed to exercise the necessary care and skill
in overseeing what he was doing.” This shows that the board of directors are too weak or
LORA TUTORING
The signs of ethical collapse
Many successful businesses operated under a set of normative standards, expected behaviors and
guidelines that are generally accepted by society (Jennings, 2009). That is, businesses operated
under ethical principles that “consist of standards and norms for behaviors that are beyond laws and
legal rights” (Jennings, 2009). These ethical principles are reflected in an organization application of
trust, integrity, fairness and responsibility. In this essay we will be discussing the ethical collapse that
occurs when any organization has drifted from the basic principles of right and wrong.
One of the first signs of an ethical collapse is the pressure to meet the numbers where financial
reports give incorrect figures and reflect what the organisation wants the markets to see. For
instance referring to the given text “In 2017, the Steinhoff share price collapsed by more than 90%,
wiping out nearly R10 billion in shareholder value in about three days,” due to ” alleged massive
accounting fraud”. Secondly we witness Sycophantic executives and an iconic CEO from the given
case study when “the company’s CEO, Markus Jooste resigned after news that German prosecutors
were investigating the company for alleged massive accounting fraud.” This showed that the CEO was
given an iconic status in the media.
We observe weak board in the case study when “Behind all that was the CEO, Leon Kirkinis, who
believed too much in his own abilities, and a board that failed to exercise the necessary care and skill
in overseeing what he was doing.” This shows that the board of directors are too weak or
LORA TUTORING
