Controversy
Bank of America Headquarters in Charlotte, North Carolina. |
Stakeholders
Stakeholders are anyone affected by the actions of the company. In this case, the stakeholders are investors, employees, and the customers that bank with Bank of America. For this case, investors may be the most important stakeholders. Since this ethical case has to do with stock prices, anyone invested into stocks that have tie-ins to Bank of America, should have concern when they see their stock drop from $90 dollars a share, to 1 cent in a second. Investors are important because that’s how Bank of America gets its money; from people buying shares in their company. If Bank of America lost people’s money, then investors would stop investing their money with Bank of America. Secondly, employees are important stockholders to the company as well. Due to the fines that the company is receiving, they may have to cut employee jobs to make up for the lost cash that the CEOs and managers cost the company. Due to the company’s actions, employees could lose their job. Lastly, customers that bank at Bank of America are at risk because if Bank of America is cutting corners then they could be miss using the customers banking with Bank of America as well.
Individualism
Utilitarianism
Customers depositing and withdrawing money at a BOA branch. |
Utilitarian ethics looks to maximize happiness
not only for one’s self, but for others as well. Happiness and pleasure are the
only things of intrinsic value and the company should bring happiness to
everyone that can possibly feel it. However,
in utilitarian ethics, the ends don’t simplify justify the means. Some things
we should do, even if it doesn’t create overall happiness. Since Bank of America was misleading
investors as to what their stock values actually were, they were not taking in
to account of the investor happiness. Investors want to see steady increase in
profits so that they know that they are making a profitable investment. These
flash crashes decrease investor confidence causing uncertainty and overall
unhappiness amongst investors. Not following SEC regulations also discourages
managers and employees that the company they’re working for are not an
ethically sound company. This decreases the happiness among workers because most
people don’t want to work for a company that doesn’t follow the government
regulations. In the long run, Bank of America should look closer at the
government regulations to make sure they are not only meeting, but exceeding
the standards, especially after this incident. They should strive to be a
better and more ethical company under utilitarianism and increase the overall
happiness for as many people as they can. Overall, Bank of America would not be
considered ethical under utilitarian standards.
Kantianism
Branch employee helping a customer. |
Kantian ethics has great respect for people and
wants to make sure that an individual has enough accurate information in order
to make their own rational decision. Should the individual not be able to act
rationally, Kant would want the individual to be helped to make the best
rational decision for them. Kant wants respect for people, their autonomy, and
their individual needs and differences. Lastly, people should be motivated by Good
Will with promotes doing the right thing because it is the right thing to do.
Bank of America did not think rationally about their actions as they didn’t pay
close enough attention to the details of the trading stock regulations. Bank of
America didn’t do the right thing morally. They chose not to do the right thing
because it was the right thing to do. According to the Good Will, they were not
right because they didn’t do the right thing which is why they ended up getting
fined. Bank of America was also not correctly motivated because they didn’t have
correct motivations in their actions. Along with the four principles, Kant also
includes the 3 categorical imperatives; the formula of Universal Law, the
formula of Humanity and the formula of Autonomy. However, the formula of
Humanity is the one that is most relevant the formula of Humanity states, “Act
in such a way that you treat humanity, whether in your own person or in the
person of another, always at the same time as an end and never simply as a
means” (Kant). Overall, Bank of America did not follow Kant’s principles as
they did not respect the individuals invested into their company, and did not
let their investors know that they had a trading cap. In order to conform to
these principles, Bank of America would need to follow all the regulations set
out by the SEC and do the right thing because it is right, and not take short
cuts or ignore the rules.
Virtue Theory
Virtue Theory includes four main virtues.
Courage is risk-taking and willingness to fight for the correct ideas and
actions. Honesty is important to have with agreements, in hiring and the
treatment of employees, along with the treatment of customers and other
companies. Temperance is reasonable expectations as well as wants and desires.
Then finally justice, which is considered hard work, quality products, good
ideas, and fair practices. Other virtues can include, but are not limited to,
trust, empathy, leadership, and gratitude. Virtue Theory really explores the
question of “how do I become a good person?” Bank of America is really lacking
the justice portion of the virtues. They were not providing a quality product
to their customers. They were obviously not working hard as they didn’t bother
to set a cap on how many stocks could be bought or sold at one time to help
regulate the stock market. This was not a good idea and was not a fair practice
as one person could control the entirety of the Bank of America stock price. In
order to have this virtue, Bank of America would need to work harder to follow
the regulations given them and work to gain back the trust of their investors.
Justified Ethical Decisions
It has become obvious that Bank of America has
acted unethically and needs to rethink how they run their company. After doing
further research, this hasn’t been the first time Bank of America has violated
these ethical theories. Just 3 months earlier, Bank of America agreed to pay
$430 million in settlements for violations involving customer cash. The same
Merrill Lynch unit misused customer cash from 2009 to 2012 in order to finance
its own trading and generate more profits. These events occurred near the same
time which shows they have been unethical. However, since these fines I hope
that they continue to work to become more ethical and become a most trusted company.
Should Bank of America change their ethics and start to think about more than
just themselves and think about the good of the population as a whole, I think they’ll
be able to recover. However, should they ignore their wrongdoings, they will
soon be out of business and do more harm than good.
References
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Martin,
Jenna. "SEC slaps BofA with record $12.5M fine for mini-flash
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Lapses That Caused Mini-Flash Crashes. "Bloomberg.com.
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