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“The Trouble With Business Ethics” by Gogoi Essay (Critical Writing)

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Updated: Aug 26th, 2021

Ethics is receiving wide-ranging discussion in today’s popular press as well as in accounting literature. People will take courses of action that seem on the surface to be against their economic interest because they want to protect the privilege of being known as professionals. The article The Trouble With Business Ethics by P. Gogoi addresses current problems and limitations of strict ethical codes and controls established by companies and the government. The author cited recent cases of Wal-Mart and Boeing affected by new ethical rules and regulations.

Professionals, and accountants, in particular, are assumed to have a command of a complicated and changing subject matter; that is why they have been hired. Ethics in accounting is a more complex notion because of the issue of third parties. Gogoi highlights that codes, and their enforcement, play a strong role in maintaining such public confidence. Accountants have a special reason to desire public support of their endeavors: businesses whose financial statements are audited pay for the accountant’s services.

Those who receive and rely upon published financial information must be confident of the independence of the professionals who conducted the audit. Following Gogoi, the main limitation of ethics is that codes, by themselves, cannot provide the means for a thorough enough scrutiny of professional responsibilities (Duska and Duska 23).

The main problem identified by Gogoi is that “most employees are reluctant to make any complaints for fear that they will either lose their job or get redirected into another position” (Gogoi 2007). The case of Chalace Epley Lowry unveils that the company does not protect its employees from information disclosure and is unable to support privacy matters and ensure security. While codes of ethics in business and professions have their use, they are not the “answer” to ethical issues.

Many accountants will bristle at the notion of laypersons regulating the profession. There is a not-so-subtle warning in statements such as these; the proper response to criticism is to ascertain any truth in the criticism. Where fault is found, correct it. To ignore this advice is to risk the specter of having outsiders do it for the profession, perhaps in a heavy-handed way.

Accountants are not without their critics concerning their professional responsibilities. Accounting is finding itself increasingly in the glare of publicity surrounding several issues of professional responsibility. The most prominently publicized are the responsibility of detecting fraud and the appropriateness of auditing the same firm for whom one has provided consulting services. Thus, Gogoi admits that: “strict ethics codes can be a catch-22 for workers. “Employees who read codes of conduct must report misconduct whether big or small. However, if you do report violations there are serious consequences” (Gogoi 2007).

Any trusting relationship entails keeping secrets. In medicine, law, and business, a relationship between a professional and the client could never proceed unless a guarantee of protection of private information were either implied or explicit.

Cost accounting is one of the most troublesome areas in modern business. Financial scandals affected such companies as Enron, WorldCom, and -Tyco put manacles on other companies limited by strict ethical codes and laws. The duty of confidentiality requires that information provided to the accountant shall not be disclosed without the specific consent of the client. For example, plans about future corporate activity must never be used for personal advantage: secrets may not be sold or bartered.

A corollary of this duty is what courts call privileged communication. This concept states that a professional may not be called upon, in court or in another legally constituted body, to divulge confidential information (Horngren et al 543). The problem is that companies, threatened by recent scandals, prefer to violate the privacy of an employee who reported the case trying to avoid a new financial scandal.

Upcoming policy changes concerning quality review will add increasingly sticky issues to the confidentiality issue. Nevertheless, for reasons of public policy as well as upholding professional standards, confidential information is often required to be released (in the most non-disclosing format possible) when such an investigation takes place. For instance, the case of Jeffrey Wigand and Brown & Williamson Tobacco shows that if an employee decides to report unethical behavior it could ruin his life and the happiness of his family (Duska and Duska 34).

In sum, the author unveils that strict codes of ethics and legal regulations do not solve the problem of fraud and misconduct. On the one hand, they force employees not to report cases of fraud, on the other hand, they ruin the life and career of a person. The simplest and most literal, kind of whistle-blowing is always regarded as morally appropriate. Whistle-blowing will always entail moral and psychological pain. Some will inevitably be upset; others will rise and fall. But in seeing ethical realism perspectives, we should not think of virtue as only on one side. Common sense is not a bad guide to action. If all of us acted upon our principles all of the time, productivity would grind to a halt as we haunted down even the most minor violators of our laws.

Works Cited

Duska, R. F., Duska, B. S. Accounting Ethics. Wiley-Blackwell, 2002.

Gogoi, P. The Trouble With Business Ethics. The Business Week Online. 2007. Web.

Horngren, Ch. T., Foster, G., Datar, S. M. Cost Accounting. Prentice Hall, 2008.

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1. IvyPanda. ""The Trouble With Business Ethics" by Gogoi." August 26, 2021. https://ivypanda.com/essays/the-trouble-with-business-ethics-by-gogoi/.


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