MidTermWritten - BUS5480 - Strategic Management Term:...

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Test Review - LUTHER SETZER Your test grade is 100 % QUESTION 1 [QUESTION BANK ID: 33612] TYPE: ESSAY Is a strategy ethical if all of its elements are legal ? Why or why not ? << HIDE ANSWERS No , a strategy is not always ethical simply because it complies with applicable laws . Laws vary across the world and so do local ethical standards . Although I personally advocate the universal code of ethics called Objectivism that Ayn Rand articulated in her great novel ATLAS SHRUGGED , I know enough about how the world works to understand that not everyone does . Moreover , I also subscribe to a universal legal theory that holds all valid laws must focus solely on the prevention of force and fraud , not the hodgepodge of regulations seen today . With those caveats established , let me tell a story to exemplify why I said that a " legal " strategy does not always equal an " ethical " strategy . The Objectivist ethical code I mentioned earlier actually played a role in the recent financial crisis . A large bank called BB T adopted those ethics quite a few years Sec . The values of that code install reality and reason as their foundations and call for treating clients justly . This means not knowingly placing any client in danger due to the client ' s own ignorance . So BB T refused to jump on the " easy credit " bandwagon that so many banks did profitably for a number of years . When the bubble burst and the banks sank , BB T remained afloat because of the firm ' s chosen ethics . Notice that all of the banks in question acted within " the bounds of the law " but only BB T acted ethically . Sadly , BB T found itself strong - armed by regulators into accepting " bailout " money it did not need so that the politicians could make the " whole industry " appear weakened rather than specific banks . The company paid back the loan as soon as the law allowed . Stories such as this one show not only why some " legal " strategies are not moral , but also why some " laws " themselves are even more immoral ! QUESTION
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MidTermWritten - BUS5480 - Strategic Management Term:...

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