Business Ethics Essay

1284 Words Oct 19th, 2013 6 Pages
Introduction

The purpose of this case assignment centers on the examination of the how the Adelphia Communications’ executives violated the trust of the company’s shareholders and the trust of the community through the analytical view of deontological ethics. This analysis will be achieved by defining deontological ethics and Immanuel Kant’s Categorical Imperative. A review of the Adelphia Communications Scandal will be conducted with a general assessment of what ethical issues were present based on deontological ethics and Immanuel Kant’s Categorical Imperative.

The Adelphia Communications Scandal

The Adelphia Communications Corporation was the sixth largest provider of cable services in the United States
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Two Ethical Issues with the Adelphia Communications Case

The Adelphia Communications Case has several ethical issues but for this assignment, we will discuss two ethical issues. The Adelphia Management exercised a serious lack of ethical decision making in their business practices, “The SEC complaint against Adelphia stated: From at least 1998 through March 2002 Adelphia systematically and fraudulently excluded billions of dollars in liabilities from its consolidated financial statements by hiding them on books of off-balance sheet affiliates”(Barlaup, Hanne, Stuart, 2009, p.8). The act of withholding information from investors to make monetary decisions is most certainly an ethical and moral issue.

The next ethical issue in the case pertains to the Rigas family receiving over $2.3 billion worth of personal loans from the Adelphia Communication Corporation (investor’s money) to purchase extravagant homes, land for an exclusive golf course and personal purchases. Specifically, John Rigas spent approximately $12 million to build a private golf course on his own property and the utilization of the Corporation’s funds was never disclosed to the investors.

Deontological Ethics

Deontological ethics is based on one’s moral obligation or duty being independent of its outcome. “According to this theory, there is only possible action, the fair thing to do. Everybody has a duty to take the right

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