|Rogit Bansal, ex banker at Goldman Sachs|
Stakeholders in this company are as broad as the global clients and not only the U.S. economy but also the global economy. Other stakeholders are the clients that bought shares as well trusted their money with Goldman Sachs. Goldman Sachs stakeholders breach out to even the citizens of the United States, these people were affected greatly. Since a company of Goldman Sachs reputation gets scrutinized it has a negative effect of the stock market and therefore the economy. This creates a downward spiral of the United States economy and the wealth and standard of living for everyone. Anyone who had stock or trusted Goldman Sachs with their future was hurt, and especially anyone who had direct business with the untrustworthy employee, Bansal, who put many people and the company at risk.
The individualism theory is that a business should act in a way where the business makes the most profit. In this case Bansal was trying to make the most profit for himself and in turn for the company by receiving confidential information to get him ahead. By Bansal doing this he maximized his profits. In 2014 Goldman Sachs total assets decreased by over 55.5 million dollars. This shows how the company took a hit from the unethical action of an employee. An individualist person would state or rationalize their actions by stating “business actions should maximize profits for the owners of the business; but do so within the law” (The Case Manual). Bansal did not necessarily have the intentions of making a profit for the company, but solely for himself. Bansal by an individualist view was not within the law at all. The stakeholders were punished by this with a dip in stock markets, even though it was not a huge drop it did not maximize or help their profits in the end. Some stakeholders may pull out if they feel as if their security in the company has been compromised. He broke the law and that is the reason for his punishment for himself and for Goldman Sachs as a company has been reflected in court. In conclusion by an individualism view he was not following the theory or rational in his choices.
The Kantianism uses rational decision making to make ethical decisions. When Bansal made the decision to illegally obtain documents he lied, cheated, and manipulated the company, customers, public, and the government. Bansal took federal reserve confidential documents to gain a personal profit. By doing it for a personal gain he went against “good will”. He also cheated the government regulations by trying to trade before client mergers were made public. He used confidential information in order to get ahead. This hurts the economy by not having a free market with competition. He hurt clients of having a fair chance with their investments. The economy also hurts in the long run by having an economic blow out, that if not caught can turn into a scheme. A rational decision would have used good reasoning with the backing of moral motives. The involvement of using confidential and private information “to use people as a mere means to get what you want” (Case Manual), violates the formula of humanity. The exploitation of information violates the freedom of the information and knowledge. He did not have good reasoning for his actions nor did he have good intentions. He did not confirm his decisions with upper management or with her manager. He did not consult or make a decision with the intentions of benefiting others.
Virtue Theory The virtue theory of the current ethical case at hand states to act with such good character traits to avoid bad character traits and acts. Rohit Bansal acted with dishonesty, untrustworthiness, manipulation, cheating, and many other bad character traits. He violated this ethical theory by not having good character traits to have him act honestly. He made his personal decision with personal gain and not thinking about the repercussions his actions would have on the other stakeholders. Jason Gross the one that sent Bansal the documents also acted with the same character traits as Bansal and was fired from his job as punishment. Goldman Sachs acted along with their mission statement “Our Business Principles, the foundation of our culture of client service, teamwork, excellence, personal initiative and accountability, are fundamental to our long-term sustainability and success” (Goldman Sachs). They hired an untrustworthy employee and whether or not they knew about the incident before the SEC found out has not been stated. As a result Goldman Sachs was fined, but they also acted with sincerity by firing their employee and putting out a public statement. They took accountability for their employee and a result they literally paid the price.
Overall I think that Rohit Bansal incident could have been stopped earlier. I think that Goldman Sachs should have caught their own employee before the Securities and Exchange Commission did. Rohit now only illegally obtained documents, but also shared the information he got from a friend in the Federal Reserve with other employees as well. He used these documents to
further his career and to only benefit himself. Bansal was only an employee at Goldman Sachs for a short period of time and received a fine and loss of career, while other employees who Bansal shared the information with received a fine and community service and Bansal’s supervisor was also fired. I personally think that all employees involved should have been fired and not just fined. If they have unethical motives or are easily influenced then they are not driven by good characteristics and do not fit with the Goldman Sachs mission. This also brings in another issue where Goldman Sachs hired a person in this case Bansal that used to oversee the bank when he was at the Federal Reserve called the “revolving door” (Peters). When companies hire former employees from the Federal Reserve they are jeopardizing the company’s future. Goldman Sachs had hired “The junior banker, Rohit Bansal, who had only been working for Goldman for about 10 weeks after spending seven years at the New York Fed, worked in the financial institutions group and specifically covered regional banks”(Peters). Companies like Goldman Sachs should be prohibited from employing personal who previously oversaw the bank. This is a conflict of interest where deals could be made and therefore the situation should be avoided.
|Lloyd Blankfein, CEO of Goldman Sachs|
This issue at hand where a Goldman Sachs employee acted unethically by illegally obtaining documents, sheds poor light upon Goldman Sachs. Even though Goldman Sachs did release a statement of “We previously reviewed and strengthened our policies and procedures after Bansal was terminated. We have no tolerance for the improper handling of confidential supervisory information.” (Protess). The company can fix this issue further, by first firing all employees involved. By not firing all the employees, but only two that were directly involved sets the tone that an employee can get away with such actions. The employees that were not fired, but charged with community service should have been fired. Their knowledge about the confidential information alone should have them fired from working. Second they should and did take full responsibility and all fees and restrictions given to them. Goldman Sachs did pay the fine and the court mandated restriction, but they should put out a statement about how they do not tolerate such behavior and build their company on ethical actions. This includes employee and management ethical training and scenario testing. Third they should have the SEC come into their company and run a fine tooth comb over everyone, so they can start with no hidden secrets in their closets. This will show the public that they are not hiding anything and abiding by the law, as well as being transparent. Fourth Goldman Sachs should state how they are sincerely sorry for betraying the trust of all the stakeholders and put out their mission statement and even print it for all employees to see and even do some employee training and ethical codes of conduct. Goldman Sachs should do a supervisor training and reevaluate all upper management. Fifth the company needs to follow the mission statement and implement it everywhere and maybe do community serviced to show their growth as a company. The mission statement of the company should be a global investment firm that is dedicated to our clients, shareholders, and community by responsibly and ethically advising and managing each individual on the basis of trust. Goldman Sachs core values should be trustworthiness, responsibility, community, and honesty. To ensure this Goldman Sachs should have a code of conduct and weekly team meetings from each individual departments all the way to the top of the company. I would also post all SEC review reports online so the company seems transparent and trustworthy. Goldman Sachs should also fire any employee that is acquiring anything unethical and all employees should sign a contract that if they violate any codes they will be terminated from the job immediately. By having new regulations and codes of conduct it will help not only Goldman Sachs image, but gain peoples trust back again into the company.