Expect More Business Scandals, Ethics Officers Say

Jan. 13, 2005
Compiled By Jill Jusko WorldCom Inc.'s announcement on June 25 of accounting irregularities should have come as no shock to participants in a recent survey by the Conference Board, New York. A majority of them said to expect at least half a dozen more ...
Compiled ByJill Jusko WorldCom Inc.'s announcement on June 25 of accounting irregularities should have come as no shock to participants in a recent survey by the Conference Board, New York. A majority of them said to expect at least half a dozen more major business scandals during the next year. ("Major" is defined as causing more than $200 million in lost shareholder value.) The survey queried nearly 100 senior ethics executives who attended a May Conference Board business ethics conference. More than 80% of the respondents work for major for-profit organizations. Other survey results indicate:
  • Nearly 60% of respondents believe their own boards of directors are not involved enough in ethics or compliance issues.
  • A majority (54%) say ethics training for Enron Corp. senior management would have made little to no difference in preventing what occurred.
  • More than 80% say they have a help line or hot line to report concerns about ethics issues.
  • When great company performers don't meet their company's ethics values, 23% of respondents say "we tolerate them," nearly 30% say "we coach them," 18% say "we fire them," and 8% say "we promote them." The Conference Board is a not-for-profit membership organization that addresses business issues.
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