Ethics Essay - Jonathan Franco FIN 311 Ethics Assignment In...

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Jonathan Franco FIN 311 Ethics Assignment In this modern cutthroat economy the best way to ensure a firm’s survival is to maximize its value. This ensures that the shareholders of the company enjoy as much profit as possible and keep investing in the firm. With that in mind, top managers and CEOs have changed the way they lead their firms with the sole purpose of maximizing profit. Simply speaking: any decision (financial or otherwise) that increases profit/value of the business is a good one, and any decision that decreases value is considered bad. While this may seem like common sense in the business world, there are negative implications that can arise as a result of this singular objective. For example, a common way to increase shareholder value is to cut costs of business. One of the easiest ways for a firm to reduce costs is to reduce employee pay, or worse yet, eliminate one or more employees that are deemed “unnecessary”. This is becoming a reality for many workers as firms struggle to maintain profits in a period of low demand. For example, in a recent statement in its website Blue Cross & Blue Shield, a leading insurance provider, was announced that it is
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This note was uploaded on 03/12/2012 for the course ACCT 211 taught by Professor Kamlet during the Spring '08 term at Binghamton University.

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Ethics Essay - Jonathan Franco FIN 311 Ethics Assignment In...

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