Preview

Ethical Compensation Research Paper

Better Essays
Open Document
Open Document
1089 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Ethical Compensation Research Paper
ETHICAL COMPENSATION

Final Paper
Kyle McCluskey
August 13th, 2010 Ethical Compensation The definition of ethical compensation is that the standards, principles or rules that give guidelines for morally correct behavior and for honesty in payment and reward of employees. Intellectuals feel that ethics involve more than just legal observance. Managers on the other hand choose to do more than the law requires. Some feel it is a sense of fairness or because it makes sense economically. The law draws a line that management should not fall below in establishing a level of behavior. Employees expect companies to stick to certain standards that represent fairness (Compensation Dilemmas: An Exercise In Ethical Decision-Making 1995). …show more content…
Pummeled by the bind of a painful recession and furious over oversized executive compensation packages at the very Wall Street firms widely blamed for the economic chaos, they gradually distrust key establishments and individual leaders. Americans are angered at the financial services region. They believe that these institutions have rigged the game so that top level executives are rewarded substantially even when they fail. Americans want action to restore fairness to the system and get pay back in line. The variety of experts and activists of political leaders and ordinary citizens, there is a belief that executive incentives have exaggerated short-term perfor¬mance, supported unnecessary risk-taking, and failed to discipline poor performance. Many believe that incentive plans have tempted some CEOs to put personal financial interests in front of good stewardship that provides the long-term interests of their organizations (Ethics Resource Center, …show more content…
(2004). The ethics of compensation systems Retrieved July 21st, 2010 from http://www.springerlink.com/content/n702477371863286/
Carter, C. (2009). Is executive compensation a matter of ethics?
Retrieved July 21st, 2010 from http://www.articlesbase.com/human-resources-articles/is- executive-compensation-a-matter-of-ethics-742982.html
Ethics Resource Center (2010) Ethical Leadership and Executive Compensation: Rewarding I Integrity in the C-suite. Retrieved July 21st, 2010 from http://www.ethics.org/files/u5/execComp.pdf
Kiplinger, K (2008) Failed CEO’s should take their lumps
Retrieved July 21st, 2010 from http://books.google.com/books?id=aT8j6zFKSzkC&pg=PT17&dq=Ethical+compensation&hl=en&ei=6EdHTOqTA4_0swO92624Ag&sa=X&oi=book_result&ct=result&resnum=2&ved=0CC4Q6AEwAQ#v=onepage&q=Ethical%20compensation&f=false
R. Bruce MacAfee and Claire J. Anderson (1995) Compensation Dilemmas: An Exercise In Ethical Decision-Making
Retrieved July 10th, 2010 from
Continue Reading
View Writing Issues

You May Also Find These Documents Helpful

  • Better Essays

    Assignment 4 Dedra Strayer
    • 2845 Words
    • 8 Pages

    Assignment 4 Dedra Strayer

    According to Labor values every business should respect their employee in the best way, and they should handle their issue with respect and in an appropriate manner. Ethics is rules that are intended to direct employers in performing what is right and what is fair towards its employees. Employment standards expect every executive of any company or firm to treat its stakeholders as well as employees within the set standards. This applies to the entire community. For instance, values look ahead to the boss to hire, select, employ, and even take care of employees in a satisfactory way. Ethics is destined to guarantee that the manager does not misuse employees by taking advantage them (Perle, 2004).…

    • 2845 Words
    • 8 Pages
    Better Essays
    Read More
  • Better Essays

    Mgmt/435 Strategic Management
    • 1130 Words
    • 5 Pages

    Mgmt/435 Strategic Management

    As professionals, we have an individual opportunity and a standard of responsibility to be committed to the standards of quality of ethical and moral standards in the workplace. Employees having a high ethical standard are paramount to the success of any organization and acting in an unethical manner will almost ultimately destroy it. This essay will provide some basic ethical guidelines that apply to organizations, why unethical behavior is happening in the workplace, and finally, it will identify ways in which management and organizations can encourage ethical behavior.…

    • 1130 Words
    • 5 Pages
    Better Essays
    Read More
  • Good Essays

    Ethical Dilemma Research Paper
    • 526 Words
    • 3 Pages

    Ethical Dilemma Research Paper

    Officers on a daily faces ethical dilemma like the one Hoyt faced. But officers have the choice to be a good cop or a great cop. At that moment when you take that oath you pledge to protect and serve. However, at times it depends on the officer financial state if that officer is in debt. That officer can be money hungry and not caring about the consequences until later. A person that just likes to get over while being a part of the law. Than you have the officer that upholds the law. Officers that cares about their community. There ethical dilemma is being video record by citizens well trying to keep the streets safe. Lack of trust from the community due to the media posting the untruth.…

    • 526 Words
    • 3 Pages
    Good Essays
    Read More
  • Good Essays

    Pay for Performance
    • 1107 Words
    • 5 Pages

    Pay for Performance

    Traditionally, all incentive plans are “pay-for-performance” plans. They pay all employees based on the employee’s performance (Dessler). Compensation is a primary motivator for employees. People look for jobs that not only suit their creativity and talents, but compensate them both in terms of salary and other benefits accordingly. Compensation is also one of the fastest changing fields in Human Resources, as companies continue to investigate various ways of rewarding employees for performance. It is very important for organizations to make sure that the incentive plans are well structured to need the needs of the employee and in return make the organization profitable. Giving incentive pay to employees that has not earned them destroys the motivation and moral of employees which leads to less productivity. Thanks to public outcry, shareholder outrage, and increased government scrutiny, companies are making some adjustments to their executive incentive programs. At the very least, it gives the appearance of linking pay to performance.…

    • 1107 Words
    • 5 Pages
    Good Essays
    Read More
  • Good Essays

    Income Inequality in America
    • 508 Words
    • 2 Pages

    Income Inequality in America

    First and foremost, let us take a look at the blessed few that constitute the .01%, .1% or even the 1% in American society. The majority of these individuals are the top corporate officials of multi-national, multi-billion dollar companies, such as General Motors, General Electric, MasterCard, Bank of America, American Express, and International Business Machines to name a few. During the last several decades, executive compensation has reached scandalous levels at certain corporations. Originally, during the 1950s and 1960s, the pay of top executives remained steady with an increase of less than 1% annually, according to economists at the Massachusetts Institute of Technology. However, over the next three decades, the earnings of the top 1% increased threefold (Inequality). According to a study done by the Congressional Budget Office, “after adjusting for inflation, the after-tax income of the top 1% jumped 139% from 1979 to 2001, whereas the income of the middle fifth rose by just 17%, to $43,700, and the income of the poorest fifth rose…

    • 508 Words
    • 2 Pages
    Good Essays
    Read More
  • Best Essays

    Golden Parachute
    • 3561 Words
    • 15 Pages

    Golden Parachute

    Often in a stack of current newspapers, the front page topics that will catch your attention are ethical issues behind upper management compensations; in this case, on March 30th 2009, the issue that surfaced was Rick Wagoner’s leave from GM and his retirement package and how his actual/ base compensation doubled in his last year from approximately $7M to $15M.(7) With the current economic crisis, many people outside the business society have become aware of the ridiculously high income difference between top managers and regular working citizens. For instance, terms such as ‘golden parachute’ have been put under the limelight and are scrutinized.…

    • 3561 Words
    • 15 Pages
    Best Essays
    Read More
  • Good Essays

    Ethical Issues In Pay Research
    • 748 Words
    • 3 Pages

    Ethical Issues In Pay Research

    Every day people face many different issues in their work environments. These issues range from pay related issues to performance issues and among them are the ethical dilemmas that they may face. The moral beliefs that people have are causing plenty of strife in their work places. One particular situation is my husband’s friend and his abuse of working the supply room and using the gas card he was issued by the military for his personal vehicles.…

    • 748 Words
    • 3 Pages
    Good Essays
    Read More
  • Better Essays

    Capitalism In America
    • 1302 Words
    • 6 Pages

    Capitalism In America

    In other words, many American people, especially in business world, are said to be greedy for money, and are the unmatched patron of diverse financial manipulations in pursuit of monetary gains. For the sake of money alone, in America money means everything, power, status, prestige, freedom, and security; and also means something mighty enough to supersede the significance of family, love, and contentment. It is the capitalism in its barest, most stripped-down version. So, for those CEOs, the issue is not whether the compensation package is adequate for their desired livelihood or not, but whether the package is larger enough to match up with their inflated cravings and mimetic desires for power and status because they consider that “they were the true creators of wealth in society and therefore were deserving respect” (Botton 54). Conspicuously, the bigger the package is, the better, and the sky is the limit. One of the most distinctive aspects of American money culture over the past decades is just how overwhelmingly the media is bombarding the public with articles, stories and comments of glorifying money and wealth. As a consequence, there is no such corner in America that people are not obsessed with money and wealth, exemplified by nationwide lottery mania. When a big environment is money centric, it is hard to blame CEOs who strive for an eye-popping compensation since they know the importance of financial achievement, and recognize that money is the socially visible measure of their success. Moreover, it takes money to make money. If CEOs want to be more successful and powerful in the future, they need to hoard more money and wealth, just as what Adam Smith puts into words, “Wealth, as Mr. Hobbes says, is power. But the person who either acquires, or succeeds to a great…

    • 1302 Words
    • 6 Pages
    Better Essays
    Read More
  • Powerful Essays

    Ceo Compensation Guide
    • 14830 Words
    • 60 Pages

    Ceo Compensation Guide

    Executive compensation is a complex and contentious subject. The high level of CEO pay in the United States has spurred an intense debate about the nature of the pay-setting process and the outcomes it produces. Some argue that large executive pay packages are the result of powerful managers setting their own pay and extracting rents from firms. Others interpret the same evidence as the result of optimal contracting in a competitive market for managerial talent. This survey summarizes the research on CEO compensation and assesses the evidence for and against these explanations. Our review suggests that both managerial power and competitive…

    • 14830 Words
    • 60 Pages
    Powerful Essays
    Read More
  • Powerful Essays

    Ethical Issues Paper
    • 1162 Words
    • 5 Pages

    Ethical Issues Paper

    Managers are faced with several moral and ethical issues such as theft, harassment, and fairness. Along with the leadership role, managers have, they have to make sure they maintain a good level of moral and ethical values. Managers have to show equality to all employees. Harassment is one of the bigger ethical and moral dilemmas managers are faced with today. Furthermore, it does not matter what level of management is under consideration – top, middle, or lower; managers at all levels, and in all functions, face situations wherein ethical considerations play a major role. The topic of ethics in management is a crucial. The bulk of ethics on work place focuses on discrimination, affirmative action, comparable worth, whistle blowing, and sexual harassment. (Carroll, A. 2002)…

    • 1162 Words
    • 5 Pages
    Powerful Essays
    Read More
  • Powerful Essays

    Enron Case Study
    • 2234 Words
    • 9 Pages

    Enron Case Study

    As in most other U.S. companies, Enron’s management was heavily compensated using stock options. Heavy use of stock option awards linked to short-term stock price may explain the focus of Enron’s management on creating expectations of rapid growth and its efforts to puff up reported earnings to meet Wall Street’s expectations. The stated intent of stock options is to align the interests of management with shareholders. But most programs award sizable option grants based on short-term accounting performance, and there are typically few requirements for managers to hold stock purchased through option programs for the long term. The experience of Enron, along with many other firms in the last few years, raises the possibility that stock compensation programs as…

    • 2234 Words
    • 9 Pages
    Powerful Essays
    Read More
  • Powerful Essays

    Sexual Discrimination of Transgendered Individuals
    • 2153 Words
    • 9 Pages

    Sexual Discrimination of Transgendered Individuals

    Hall Jr., E., & Hollingsworth, J. (1991). Utilitarianism: An ethical framework for compensation decision making. Review of Business, 13(3), 17. Retrieved August 18, 2013, from www.ebscohost.com…

    • 2153 Words
    • 9 Pages
    Powerful Essays
    Read More
  • Good Essays

    Ethics Reflection Paper
    • 756 Words
    • 4 Pages

    Ethics Reflection Paper

    A company that incorporates ethical guidelines can correlate the rules, regulations, and norms that will help in staying within an ethical working environment. Reward systems are set up as a form of strategic plan by some…

    • 756 Words
    • 4 Pages
    Good Essays
    Read More
  • Powerful Essays

    COMPENSATION ADMINISTRATION final essay
    • 1415 Words
    • 4 Pages

    COMPENSATION ADMINISTRATION final essay

    1.) Exempt jobs are not subject to provisions of the FLSA with respect to minimum wage and overtime. Exempt employees include most executives, administrators, professionals, and outside sales representatives. Nonexempt employees are those who are subject to the provisions of the FLSA. To qualify for any of the preceding exemption categories, all of the pertaining tests must be met. Because of their duties, responsibilities, and salaries, employees in exempt jobs are not covered by the overtime provision of the FLSA. "Exempt" is not a title, but a legal classification based largely on job content. Exempt staffs are compensated on a salary basis without deductions for quality or quantity of work, except as permitted under the FLSA. Employees in nonexempt jobs are covered by the overtime provisions in the FLSA and must be paid overtime at one and a half times the regular rate for all hours worked over 40 per pay period. Most problems occur for employers when they have employees in exempt status that do not meet all the necessary requirements for exemption. This can result in lawsuits as seen with Merrill Lynch when they reached a $37 million settlement for not paying overtime to a nonexempt financial analyst that what classified under the administrative exemption. Employees experience a dock in pay when they are misclassified as exempt. They can be over worked and taken advantage of under the exempt status, even when they are rightly classified. Employers face an issue of poor quality of work when they have employees that are being worked long hours without overtime pay.…

    • 1415 Words
    • 4 Pages
    Powerful Essays
    Read More
  • Good Essays

    Ethics, Justice, and Fair Treatment in HR Management
    • 2577 Words
    • 13 Pages

    Ethics, Justice, and Fair Treatment in HR Management

    “Ethics and fair treatment play important roles in managing employees at work. Of course, few societies rely solely on managers’ ethics or sense of fairness to ensure that they do what’s right by their employee.”…

    • 2577 Words
    • 13 Pages
    Good Essays
    Read More

Related Topics