a. Major Ethics Issues
While Richard Okumoto was reviewing the “adjusting journal entries”, he noticed some entries that concerned him. These entries caught his attention because they “significantly changed the company’s results.” Furthermore, these entries were made by the CEO, James Dooley, the corporate controller, and senior members of the finance department. The most noteworthy entry was worth $997,000 and it affected the retirement and severance benefits of employees. Thus, with the elimination of these liabilities, the company could report quarterly earnings, rather than a loss. These actions were surely related to the 2001 economic downturn. The elimination of employee benefits is a major ethical issue, because not only were these employees promised these benefits, but they were taken away from them in secret. The actions taken by James Dooley, and company, exemplify the Machiavellian traits of being self-interested, opportunistic, deceptive, and manipulative. Not to mention that their actions were also highly illegal.
b. Sub-Issues, identification of the “Influencers” in this scenario, and other business environment considerations …show more content…
The most apparent is James Dooley and his position as the Chief Executive Officer. A CEO, through their conduct and leadership, sets the tone for the organizational culture. They must walk the walk in order to ensure that others are acting ethically. Dooley was the complete opposite of a role model, the traits he exemplified were dishonesty, defensiveness, bullying, intimidation, and combativeness. At one point Okumoto even described talking with former members of Dooley’s finance team as, “They reminded me of beaten animals.” Dooley effectively created an environment where no one could speak out. Furthermore, the unethical behavior went above and beyond Dooley. When Okumoto went to the general counsel