Corporate Social Responsibility Enron And Worldcom

Since companies like Enron and WorldCom behaved unethically costing shareholders millions of dollars there has been a focus on a business corporate social responsibility efforts. Corporate social responsibility can be defined as anything ‘concerned with the commitment of companies to contribute to sustainable development, stakeholder interests and enhancement of societal conditions† (Luu 2). This is an important concept because it deals with the stakeholders who are going to invest in a business firm. If a business is to go against treating their shareholders ethically they will lose all of their following and may accept the same fate as Enron and WorldCom by going bankrupt. In response to some companies acting unethically the government has enacted policies to make sure that businesses are following corporate social responsibility to help restore the confidence in shareholders. Corporate social responsibility starts at the top of an organization and trickles its way down to the bottom through the culture of the organization. If the senior level management shows that it is okay to tweak numbers to make the overall firm look better in the eyes of the shareholder, then that behavior will be continued down throughout the organization. This is one of the biggest problems when it comes to corporate social responsibility, the decision between tweaking the numbers of the business to look good, or taking the ethical route and reporting the numbers as they are even if it showsShow MoreRelatedThe Sarbanes Oxley ( Sox ) Act Of 20021617 Words   |  7 Pagesthe Sarbanes-Oxley (SOX) Act of 2002. A brief historical summary of SOX will be presented, including the events leading up to its passage. The key ethical components of SOX will be identified and explained. The social responsibility implications of the mandatory publication of corporate ethics will be assessed. 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