Wal-Mart: Save Money. Live Worse.


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Everyone has heard of Wal-Mart. Some may have heard of its impressive supply chain management, while to most others, Wal-Mart is known for its everyday low prices and huge assortment of inventory, providing its customers with practically everything they could possibly need. For Bucknell students, Wal-Mart is a necessity. It’s the perfect one-stop shop that suits the schedule of the rushed college student. I’ve never been to the Wal-Mart in town without seeing at least a few Bucknellians stocking up on food or party supplies. Most customers leave the superstore satisfied with their shopping experience as long as they did not become too overwhelmed by the vastness of the store. The main problem to consider here is how many Wal-Mart employees leave the store after their shift satisfied with their job?

I’ve recently discovered some pretty disturbing news about Wal-Mart and the way that employees are treated there in general. The company is essentially blocking out the ways that employees are able to speak out. Unions are strongly discouraged by the company and oftentimes, the typical Wal-Mart employee does not have the extra money available to pay for union dues. Even the new employee orientation has a section dedicated to preaching the evils of unions. Wal-Mart labor protests have arisen in the last year and were aimed at pressing Wal-Mart to increase wages, stop cutting workers’ hours, and to treat employees with respect. And these protesters did not all come from the same Wal-Mart store or even the same state, they came from over 28 stores and 12 different states.

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Wal-Mart Labor Protests

Wal-Mart’s corporate culture is built around the idea of cutting costs to provide its customers with the low prices that they expect. The employees are also becoming victim to this low-cost strategy. Minimum wage is hardly enough to support one person, let alone a family. It seems as if the corporate structure of Wal-Mart is doing everything it can to keep its employees below the poverty line. Therefore it can remain in its position of power to keep its employees voiceless. This practice hardly seems to be the least bit ethical. The employees of Wal-Mart deserve to be able to voice their problems and speak out against the wrongs that may be occurring in the workplace. Wal-Mart’s hindering of this basic right is flat-out unethical.

Fool me once shame on you, Fool me twice shame on me


Merrill Lynch is another company that was briefly brought up in class as an example of a financial institution that was bailed out during the financial crisis. When Merrill Lynch was teetering on the brink of bankruptcy, the company’s CEO was not concerned about the future of the bank, the economy or what he could do to save the company. Instead he was worrying about whether his bonus and salary were going to be cut. John Thain was the CEO of Merrill Lynch in 2007 when the company started to experience major economic downfall. Merrill Lynch was eventually saved when it was purchased by Bank of America. Thain, like so many other CEOs in the financial sector at the time, convinced investors that the firm was performing great while it was majorly failing. In addition to tricking the public, he also milked the company for as much money as he could get his hands on. He is infamous for spending $1.22 million on redecorating his office using shareholder money while Merrill Lynch was taking a turn for the worse. At the time, the color of the rugs in his office was more important to him than the color of Merrill Lynch’s balance sheets. He wanted to make sure that he cleaned out the wealth of the company before it merged with Bank of America. Before his grand exit, it is reported that he tried to take a $10 million bonus. Thain genuinely felt that he earned this bonus when in reality all he earned was a lawsuit. At a time of instability and chaos in our society, an influential CEO was more concerned with his own financial stability then the future of the American economy. Is this really the people we entrust our money and the future of the economy with?

Even after all of Thain’s greedy and deceitful actions while he was CEO at Merrill Lynch, he was still given another chance to head a firm. In contrast to Jeffrey Skilling, Thain was not charged with any criminal or civil crimes and escaped the entire mess without a visible scratch on him. He was not even given a ban from working in the financial industry, like the two Bear Stearns’ executives. Not even his reputation was majorly harmed since he was given the opportunity to run another firm. I do not know how investors of this company felt comfortable with letting this man run another firm after running the previous one into the ground. The name of the firm is the CIT group, a company that lends to small and midsized businesses. CIT was also bailed out by more than $2 billion of government TARP money, failed for bankruptcy, and is now on the radar of the Federal Reserve. I do not understand how Thain who caused so much damage is allowed to run another company that deceived the public and was bailed out. Since he was not even given a slap on the wrist for his actions, who is to say that he will ever learn his lesson?

Reports have claimed that he has learned his lesson since his days at Merrill Lynch. Apparently he now spends a large portion of his time at CIT trying to enhance shareholder value. I am very skeptical that a man that participated in so many unethical practices is all of a sudden a changed man. And to make matters worse, Thain has a dream of returning back to Wall Street to run one of the big financial institutions. Right now it seems as if John Thain is laying low to wait for the perfect time to return back to Wall Street. Only time will tell if Thain will continue on the straight and narrow ethical path or whether or not he will return to his deceitful ways. I think that it is only a matter of time that Thain will show his true colors to the American public when he deceives the public for the second time.

http://www.huffingtonpost.com/charles-gasparino/john-thain-cit-group_b_1922758.html

 

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John Thain cleaning out the Merrill Lynch refrigerator without a care about tomorrow.

 

The Death of Arthur Andersen


Arthur Andersen's loss of reputation

Arthur Andersen’s loss of reputation

Arthur Andersen was a facilitator of the fraud that went on at Enron. The auditing/consulting company acted in unethical ways by looking in the best short-term interests of the firm in order to make substantial personal gains. The employees of Arthur Andersen were making too much money off of their Enron accounts, which caused them to not practice good moral judgments. This conflict of interest resulted in the large-scale financial scandal that destroyed Enron, and in essence, destroyed Arthur Andersen as well.

As a result of this scandal, Arthur Andersen voluntarily surrendered its CPA license in 2002. The firms’ reputation and trust were so severely damaged that it lost most of its partners to other auditing firms as its clients also fled to competing firms. Since the financial scandals, Arthur Andersen has been mainly involved in a cleanup effort to resolve the crimes that it had committed in the past by basically just operating to settle remaining litigation against the firm.

In a recent news article about Arthur Andersen, the author Michael Cohn describes the result of a decade-long class-action lawsuit against the firm. WorldCom and Arthur Andersen have just reached a settlement for WorldCom to receive an additional $38 million. This payment will settle and release the contingent payment claim that was  a term of a previous settlement.

Arthur Andersen is nowhere close to the company it once was. The firms’ use of unethical business practices has destroyed its reputation past the point of repair. In essence, the company is now considered obsolete. Far too much taboo and negativity is associated with the once-prestigious name of Arthur Andersen. The immoral practices of the firm over a decade ago were too severe to permit any sort of recovery.

The "death" of Arthur Andersen in 2002

The “death” of Arthur Andersen in 2002

Andersen to Pay Additional $38M for WorldCom Audits

Steroid Use in Sports


When thinking back on my own personal experience with sports, I have come to the conclusion that I have never sacrificed ethics for an athletic victory, nor have I witnessed any of my teammates behave in an unethical way. Perhaps I can attribute this to the nature of the sports I have played. I have individually competed in sailing races and tennis tournaments throughout high school and have also participated in the team sports of field hockey and lacrosse. In all those years, I mostly remember how much sportsmanship was preached to me. My coaches would not tolerate unsportsmanlike conduct and made sure that we always displayed kind behavior throughout all competitions. I may not have experienced unethical behavior first-hand, but I do know that it exists in the realm of sports. Even from just playing board games against my sister, I know that nothing makes me madder then when someone cheats. I am a firm believer that no one should cheat to gain an unfair advantage.

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When I think of MLB, I automatically think of steroids.

World-wide, in competitive sports, I am most annoyed by the amount of steroid usage that is present. Athletic competitions these days are plagued by the use of steroids, which is cheating, plain and simple. Due to the highly competitive nature of most sports, athletes often lose sight of their own values and become ruthless to do whatever it takes to win. So much pressure is placed on athletes to perform the best, which makes steroids look pretty enticing to them. Steroids may seem like the easy way out, especially if the punishment for taking the drugs isn’t that severe or strictly enforced. Steroids give athletes an unfair advantage over their competitors and disrupt the natural status quo of sport victories.

Professional athletes are role models for so many people. They are admired based on their achievements. Young people who are just starting up their sports careers look up to these athletes and may not think that the drug is that bad if their role model is taking it. This can be damaging to society as a whole. In addition, I should still mention the destructive damage that these drugs do to the natural growth of the body.

The unethical use of steroids in sports is very similar to unethical practices in business. Athletes that use steroids fall victim to the mistake of short-termism thinking. Sure, if you take steroids, in the short term you will experience agreeable results. It is the easy option to achieve your immediate goals of perhaps gaining muscle, or getting bigger or stronger. However, it is important for these athletes to not lose sight of the long run. Steroids are damaging to not only the athletes but also to society. The same is true for companies that focus on short-termism—companies that do anything to raise their stock price and manipulate their balance sheet to look good for investors. Taking steroids is equivalent to not disclosing something in your balance sheet. Athletes, as well as companies, need to be honest. We need to level the playing field so that no one feels the pressure to take these terrible performance enhancing drugs that should be eliminated from all sports.

Strategy or Ethics?


My first present from my father was a soccer ball. I was two years old, and had just begun to walk. I joined my first soccer team at age three, and from that moment on until my senior year of high school, I went to soccer practice every single weekend. When I was little, it was all about the fun of the game. That was until I joined my first travel soccer team, The Yorktown Amazons.

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We were eight years old, and my father was our coach. I played on the same team with the same girls for the next ten years of my life. As soon as middle school rolled around, team parents were already starting to talk about college scholarships. All of a sudden we had enormous pressure to perform well in tournaments. We went on to win first place in countless tournament for the next few years, and became classified as a Northeast Region 1 Premiere team. This was a huge achievement. After clinching some more wins, we had succeeded in becoming nationally ranked.

However, the road to glory was not as easy as I just made it sound. In the game of soccer, just as with life, unethical behavior can sometimes give you an advantage. For example, I know from experience that it is fairly easy for a team member to fake an injury or a foul an opposing player in order to get the ball back. For instance, pretend for a moment that you are a defensive player. You are one-on-one with an offender on the opposing team. They are heading for the goal and you fear that they will pull ahead of you. You know that your team will have a better chance of preventing a goal if the opposing team has a free kick rather than a wide open shot in front of the goal. What do you do? Foul her outside of the box. This way, your team can recover back towards the goal, and set up a defensive strategy to increase our chances of getting the ball back. As long as you do not trip her inside of the box, you will usually not receive a yellow or red card and get thrown out of the game. With the enormous amount of pressure that we carried on our shoulders, these type of fouls were commonplace (among others). There are countless “strategies” such as this that people use in the world of sports to gain advantage in a game. But where is the line drawn between strategy, and poor ethical behavior?

During my senior year, I was tripped by a member of a different team while playing in the State Cup Tournament final. I completely tore through my hamstring. The same “strategies” that my team had used on others, had been used on me. I was done. I would never be able to play in another soccer game with my team. I would never be able to play Division 1 soccer. Everything that I had worked so hard to accomplish meant nothing now. I had given up hundreds of weekends (seriously hundreds) to go play in tournaments down in Virginia, North Carolina, Rhode Island, Pennsylvania, etc. I would never again be as fast or as strong as I had once been. I was completely crushed. All of this pain stemmed from one personal foul against me on the field. I couldn’t help but wonder, had I done this to anyone at some point? I felt terrible.

On another note, I feel that there are no sports organizations that are perfect models for ethical behavior. Every organization that I can think of has had some scandal or debate about their behaviors.  For example, in the sport of Jockey, some horse owners have been known to break horses legs if they are not performing well enough, or even murder the horses, in order to collect insurance money and purchase a new young horse. Is this ethical? NO!!!!! It actually disgusts me that animal cruelty such as this exists at all.

It took me forever to locate this clip, but I finally found it. I remember when I was younger and saw this for the first time, I was completely shocked. It has been burned into my mind ever since. In the following clip we see pro soccer player, Tab Ramos, taking an elbow to the head. Would you classify this as “strategy” or “unethical behavior”? Why?