Culture and Global Business
Introduction Culture involves the manner in which individuals imagine, sense and do. It changes from one country, industry and organization to the other. From a business point off view, it is helpful to consider of culture as comprising of four different levels. These levels are of nation, business, industry and organization. Every one of these […]
Role of Family in Consumer Behaviour
No two individuals have same buying preferences. The buying tendencies of individuals vary as per their age, need, income, lifestyle, geographical location, willingness to spend, family status and so on. An individual’s immediate family members play an essential role in influencing his/her buying behaviour. An individual tends to discuss with his immediate family members before […]
Choosing Brand Elements to Build Brand Equity
Brand equity is the result of a process which leads to a creation of a unique and distinct brand identity. These brand identifiers are referred to as brand identifiers. Brand identification can be done through various ways; for example, Unique Selling Proposition (USP), Logo, Style, Brand Ambassador, Etc. Brand elements facilitate the process of consumer […]
Business Strategies to Beat the Downturn
Introduction: The Effect of the Downturn and How Companies Can Cope The ongoing global economic crisis has impacted most of the companies in the world as they have to not only reckon with falling sales, stagnating demand, oversupply, and inflation all at the same time mean that businesses are operating in “chaotic” and “uncertain” environments. […]
Leadership in Service Industry
The past few decades has seen unprecedented growth of service industry. In fact we can today say that the service industry is at its maturity stage. The gamut of services that make up for the significant contribution towards the GDP of the economy are numerous ranging from financial services, health care, hospitality, travel, insurance, information […]
The often discussed and much criticized role of the government in regulating the corporate has gained all the more importance in these changing economic times. It’s time that the governments took more active role in regularizing the corporate through necessary means as we have learnt the painful way that the corporate crimes or the white collar crimes as they are called not at all victimless. So, if an old employee losses all his pension and savings on account of a corporate fraud committed by his organizations, the ramifications are long term. The mere wrist slapping exercise and sometimes even bail out that the government finances for erring corporate, surely does not act as a deterrent for others.
The very complex nature of the government and corporate can be clearly studied in the ongoing crisis in the European Union where the question of whether to use tax payers money to bail out Greece’s economy has become a political decisions rather than a business one. So what is the alternate path? Allowing self regulation by organization means making fox the shepherd, while on the other hand, going by the rule book approach of the US government has also been under much criticism, more so after the current financial crisis begun.
The other aspect of the scenario is the fact that fines are considered to be a part of doing business by the corporate, and the civic penalties that are occasionally levied against them is hardly enough to set example. The criminal sanctions against corporate are not a common phenomenon and the experts believe that can be more potent in deterring corporate misconduct. However, the other side of the coin is the fact that most of the regulating authorities like SEC etc have no authorities to impose criminal sanctions against corporate. Also, the penalties and fines bring no respite to the employees, shareholders and communities. [Recall the Bhopal Gas Tragedy]. Reasonably evaluated criminal and civic sanctions in a mix as appropriate can help address the issue.
The choice of going after the corporation or people, who have been involved in the misconduct, is another important consideration. A rather fair and objective view of this issue is that if the organization has a proper system of safeguards and checks in systems and processes and if the misconduct profits just one person, in this case even the corporate becomes a victim. For such situations a single person can be accused of embezzlement and liable for prosecution however if the fraud is at a larger level involving more people, the situation becomes complex, whether to hold liable the board members and senior leaders for failing to ensure the prevention.
The recent legislative development has come up with a guideline for the corporate:
The government should also ensure that there are not too many agencies to act as enforcement authorities as this may lead to conflict of interests.
Your email address will not be published. Required fields are marked *
Corporate Reputation Management in the Post Truth Era and the Age of Fake News
February 12, 2025
Effective Corporate Governance Has to be Practiced at all Levels of the Organization
February 12, 2025
