Take-Home Examination Cover Sheet (March 2020 Semester) MGT3044

Assessment Information
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STUDENT ID: 1 8 0 2 3 9 8 6

STUDENT NAME: Ho Jia Wei

Take-Home Examination Cover Sheet (March 2020 Semester) MGT3044

March 2020 Semester

Alternative End of Semester Assessment
MGT3044 Business Ethics & Social
Responsibility

Instructions to Student
 This Take-Home Exam Paper has two (2) sections, Section A and B.
 Student is required to answer 2 questions
o Section A: Compulsory 1 question.
o Section B: Answer 1 out of 3 questions.
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not submit.
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Certificate affecting the exam period to your lecturer.
 Duration: 6th July to 10th July, 12noon.
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exam period.
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Toh, seongyuent@sunway.edu.my
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 I acknowledge and agree that I have read and understood the Student Handbook for
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For examiners use only:

Question First Marker Second Marker

Total
Take-Home Examination Cover Sheet (March 2020 Semester) MGT3044

[Student’s answer starts below here]

Section A
Bribery is prevalent in both developed and undeveloped countries across the globe. It is a
payment promised by the briber to ask for a party to act on the briber’s interests (Frederick,
2013). Generally, such payments are made to an official to utilise his authority to violate
official responsibility (Philips, 1984). Lately, bribes may involve in inexpensive home
appliances, jewelries, branded accessories, stocks, houses and even adultery (Tian, 2007).
For instance, a San Diego-based corporation, Titan had bribed government officials with
approximately $2million of cash and expensive earrings to the President’s wife to pursue a
telecoms venture and charge higher management fees to the public (Tian, 2007). Bribery is
deemed as an illegal action in most of the countries, however, there is dual standard
regarding the bribery payment in certain countries. For instance, Germany treats bribes as
tax deductible business expenses, reflecting that bribery to be a norm in business world
(Spiers & Kovaly, 1975).

Bribery is Ethical
Based on Ethical Relativism, bribery is ethical if it is a norm or culture in the society.
It is supported by Graham (1983) that bribery is crucial for successful financial performance
in certain countries despite being forbidden in most of the countries. Therefore, he supports
the view of ‘when in Rome do as the Romas do’ which implies that bribers are ethical if
bribery is the norm in their society (Tsalikis & Nwachukwu, 1991). For example, it is ethical
to offer bribes in countries like Cambodia, Yemen and Indonesia where bribery is
omnipresent across these nations (Kuncoro, 2004). Furthermore, Forsyth (1980) had
asserted that relativists have stronger reliance on circumstances more than ethical
principles to determine the right-or-wrong of decisions. Therefore, provided that the society
accepts the culture of bribery, bribers are considered ethical under such circumstance
(Tian, 2007). Many may argue that bribery will lead to disastrous societal effects. However,
ethical relativism allows corporations to disregard the immoral decisions as other
corporations in the region are practicing the immoral decisions. Therefore, based on ethical
Take-Home Examination Cover Sheet (March 2020 Semester) MGT3044

relativism, the negative relationship between ethical sensitivity and relativism of

corporations is disregarded (Sparks & Hunt, 1998).
Moreover, ethical egoism indicates that actions are ethical if one’s self-interest is
being fully satisfied (Sham & Barry, 2016). Hence, based on ethical egoism, bribery is
ethical as it maximises one’s self-interests. Bribery is a tool to maximise profits of
corporations in developing countries. For example, Samsung was accused of bribing the
prosecutors and government officials for the political position in South Korea to create
competitive advantages over its competitors (Jung, Graeff & Shim, 2011). Although it
misuses the authority granted to the government officials, ethical egoism only concerns
about the self-interest of the corporations to determine the morality of bribery. Such
individualism has caused bribery to be ethical as it maximises corporations’ profits.
Besides, the bribe takers’ self-interests will be maximized through high amount of bribery
payments offered. Although bribe takers disregard their fiduciary duties to serve for their
organisations’ best interest, greed and individualism may overweigh their fiduciary duties,
thus being ethical when maximizing their own interests by taking bribes.
Furthermore, utilitarianism indicates that actions are ethical if they generate the
greatest amount of satisfactions to everyone. Corporations would require an enormous
amount of resources to obtain competitive advantages over their competitors to boost their
performances. In certain cases, confidential information may not be available in the market
which lead to lack of information to corporations, resulting in ineffective decision making
(Portar & Millar, 1985). Bribery conducted by corporations is one of the cheapest, effective
and efficient ways to obtain both available and unavailable information to achieve
competitive advantages (Zhou & Peng, 2011). For instance, a one-off bribery payment will
be given to the officials to obtain the confidential information from the government or
competitors. It is relatively faster and cheaper to obtain information rather than recruiting a
group of researchers and professionals to analyse the information which costs more time
and money (Portar & Millar, 1985). By achieving competitive advantages, corporations will
produce higher quality and more variety of products to the public, thus benefiting the society
and boosting corporate sales. However, it may lead to monopolizing the market which
threaten the small-and-medium firms. Therefore, based on utilitarianism, it is obvious that
bribery is ethical as the amount of happiness enjoyed by the public and corporations
overweigh its damages on small-and-medium firms.
Take-Home Examination Cover Sheet (March 2020 Semester) MGT3044

Bribery is unethical
Based on prima facie duty, it rejects the individualism and asserts that one must
emphasize on one’s most important obligation. As an ordinary citizen, he may treat earning
money as his prima facie duty as he priotises his obligation to financially support his family
members. However, any member of companies has implicitly agreed upon prioritizing
fiduciary duties whereby all members must act in the best interest of the company (Carson,
1987). Hence, bribe takers will fail their fiduciary duties when they receive bribery to leak
information or betray his company. Fiduciary duties will undoubtedly overweigh personal
interests when the person has the role as the company’s member because it will break the
implicit promise made when he first being employed (Philips, 1984). For example, it is
unjust to the public which is the shareholder of the Malaysian government, as officials have
been receiving bribes to leak government incentives to companies, thus failing their prima
facie duty towards the citizens who they are supposed to serve at citizens’ best interest
instead of using the information to gain personal interests (Wu, 2008). Therefore, bribery is
unethical as it fails the fiduciary duties and damages companies’ profitability and reputation.

Based on Kantian Theory, Immanuel Kant asserted that actions made by an

individual are ethical if they are what a rational man would do. In Kant’s categorical
imperative, he established the formulations to determine the actions that are considered as
right and rational things to do. He asserted that individuals must act in a way where we can
will the maxim of their actions to be universally applicable. For instance, if bribery is
universalized, it would not be conducted under-the-table to gain competitive advantage over
others (Kant & Schneewind, 2002). With the universalization of bribery, confidential
information of corporations will no longer exist while internal controls and corporate
governance will fail to manage and protect the corporations since any corporation can
easily attain confidential information of other companies through bribery, resulting in failure
to be universally applied. Furthermore, Kant stated that one should not treat human as a
mean but as an end. In the context of bribery, corporations tend to treat bribe takers as
means to obtain confidential information to meet self-interests of gaining competitive
advantages. Hence, bribery is unethical as it treats others as means to achieve own ends.
Take-Home Examination Cover Sheet (March 2020 Semester) MGT3044

Based on libertarianism, all humans have the freedom to do whatever they want. It
simply means that they do not have the rights to coerce others to do something that they
refuse to do (Sham & Barry, 2016). Bribery may seem to be liberal as it is a mutual consent
on both bribe takers and bribe givers which no one is forced to do so. However,
libertarianism claims that one should not interfere others’ rights which will otherwise be self-
conflicting as it allows all humans to hold freedom in doing whatever they want (Sham &
Barry, 2016). Hence, bribery is unethical as others will be victimized which will interfere
them. For instance, Siemens, a German company has been paying bribes to the
government officials and civil servants to maximise profits through overpriced construction
services. It is unjust for the taxpayers are paying additional money for the overpriced
construction of roads and powerplants as the result of bribery received by the Germany
officials (Biegelman & Biegelman, 2010). Hence, bribery is unethical as it will victimize
others and hinder them from enjoying the satisfactions that they are supposed to enjoy.

Supporting that Bribery is Unethical

According to Rawlsian Theory, the ‘original position’ is introduced as an imaginary
scenario where all humans regardless of their social status are placed behind a veil of
ignorance which leave them to be uncertain about their future. In this case, bribery is unfair
to certain corporations that tend to be victimised through bribery while positive impacts of
bribery are distributed unfairly to the relevant parties (Shaw & Barry, 2019). Hence,
assumption of original position is made, they would not agree with bribery as they would
prefer fair treatments in the society rather than being victimised by briberies. Therefore,
briberies are unjust and unethical because no one would willingly bear the costs of bribery.
Furthermore, Rawls states that actions are considered as just if they bring benefits to the
most unfortunate group in the society. Apparently, bribery fails to help the group with least
power in the society. For example, corporations that involve in bribery will benefit the
related companies while possibly deteriorating the performance of small-medium-
enterprises due to loss of competitive advantages in an unfair way (Zhou & Peng, 2011).
Therefore, bribery is unethical as it fails the Rawls’ principles of benefiting the least
advantaged group.
Take-Home Examination Cover Sheet (March 2020 Semester) MGT3044

According to the social contract theory, individuals and corporations have the implicit
societal obligations and duties to maximise the society welfare. In the context of bribery,
society welfare tends to be sacrificed to achieve competitive advantages in corporations.
For instance, bribery offered by Siemens to the German government officials and civil
servants to maximise its profits through overpriced construction services will lead to higher
costs to the government to build roads and powerplants (Biegelman & Biegelman, 2010).
Consequently, it suffers the taxpayers as additional costs of building roads and powerplants
could have been well utilized on other projects to build more infrastructures and even to
help citizens in need. Therefore, bribery has breached its social contracts bind with the
society as companies prioritise their own interests at the expense of potential social
welfare. For instance, Siemens, a German company has been paying bribes to the government
officials and civil servants to maximise profits through overpriced construction services. It is unjust
for the taxpayers are paying additional money for the overpriced construction of roads and
powerplants as the result of bribery received by the Germany officials (Biegelman & Biegelman,
2010).

Against Bribery is Ethical

Bribery may seem ethical as it maximises one’s self-interest based on egoism
theory. Ethical egoism rationalises that bribery used by corporations are merely self-interest
driven because it believes all actions are selfishly motivated and purely unselfish actions do
not exist (Sham & Barry, 2016). However, there are exceptions where people are acting not
for self-interest. For example, Mahatma Gandhi fought against racial oppression and
protested British Salt Act which prohibited Indians from selling salts and imposed hefty tax
on it (Singhal, 2010). This example rejects egoism principles by proving the selfless side of
humanity (Shaw & Barry, 2016). Therefore, bribery is unethical if corporations use it to
increase profit as not everyone acts selfishly. Furthermore, egoism directly disregards
wrongful actions that will apparently harm others. For example, ethical egoism accepts
bribery which will definitely harm the citizens and other small-medium enterprises to
benefits own self. Consequently, a selfish and self-centred society will demolish the peace
in the society as ethical egoism encourages all people be amoral when striving for self-
interests. Therefore, ethical egoism is inapplicable to defend bribery as an ethical action.
Although bribery may seem ethical as it maximises total happiness, there are
limitations on claiming that bribery is ethical when applying utilitarianism. Firstly, no one can
assure that bribery will lead to maximisation of total happiness as the consequences are
Take-Home Examination Cover Sheet (March 2020 Semester) MGT3044

mere predictions which are uncertain (Shaw & Barry, 2016). For example, briberies
received by the Malaysian government officials may cost the Malaysia economy and society
higher than the benefits enjoyed by the society as monopolisation of the market by a
corporation will lead to inefficient market. In this case, bribery will fail to maximise total
happiness as the negative impacts of bribery overweigh the positive impacts of bribery. The
unpredictability of consequences of bribery cannot prove it to be ethical when applying
utilitarianism. Even if the benefits of bribery outweigh its costs, utilitarianism allows the
greatest amount of happiness to be achieved at the expense of people’s happiness, leading
to an unfair to the parties that either willingly or unwillingly sacrifice their happiness (Shaw &
Barry, 2016). For instance, according to Zhou and Peng (2011), bribery has caused decline
of business performance by 29% in large companies across the globe. This shows that pro-
utilitarianism has ignored the 29% loss suffered by shareholders as the result of bribery. In
short, CSR is unethical when applying utilitarianism.

(2087 words)

Reference

Biegelman, M. T., & Biegelman, D. R. (2010). Foreign corrupt practices act compliance
guidebook: Protecting your organization from bribery and corruption. Hoboken, N.J:
John Wiley & Sons. Retrieved from https://books.google.com.my/books?
hl=en&lr=&id=c_EB1ZOyBlUC&oi=fnd&pg=PA19&dq=Siemens+bribery&ots=jW3b6q
lLOd&sig=2Of601PUxJVab8KebxfKWNRAQ2o&redir_esc=y#v=onepage&q=Siemen
s%20bribery&f=false.

Carson, T. L. (1987). Bribery and implicit agreements: A reply to Philips. Journal of

Business Ethics, 6(2), 123–125. https://doi.org/10.1007/BF00382025.

D’Andrade, K. (1985). Bribery. Journal of Business Ethics, 4(4), 239–248.

https://doi.org/10.1007/BF00381765.
Forsyth, D. R.: 1980, A Taxanomy of Ethical Ideologies, Journal of Personality and Social
Psychology 39, 175–184. https://doi.org/10.1037/0022-3514.39.1.175.
Frederick, R. (2013). Bribery and Extortion. International Encyclopedia of Ethics.
https://doi.org/10.1002/9781444367072.wbiee332.
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Graham, John L.: 1983, 'Foreign Corrupt Practices: A Manager's Guide,' Columbia Journal
of World Business, (Fall), 89-94.
John, L. K., Kim, T., & Barasz, K. (2018). Ads don't overstep. HARVARD BUSINESS
REVIEW JANUARY–FEBRUARY 2018. https://hbr.org/2018/01/ads-that-dont-
overstep.
Jung, T., Graeff, R., & Shim, W. (2011). Good for Samsung is Good for Korea: Image
Restoration Strategies Used by Samsung After a Whistle-Blowing Corruption
Scandal. The Open Communication Journal, 5, 23-28. Retrieved from
https://benthamopen.com/contents/pdf/TOCOMMJ/TOCOMMJ-5-23.pdf
Kant, I., & Schneewind, J. B. (2002). Groundwork for the metaphysics of morals. Yale
University Press.

Kuncoro, A. (2004). Bribery in Indonesia: some evidence from micro-level data. Bulletin of

Indonesian Economic Studies, 40(3), 329–354.
https://doi.org/10.1080/0007491042000231511.

Philips, M. (1984). Bribery. Ethics, 94(4), 621–636. https://doi.org/10.1086/292580.

Porter, M. E., & Millar, V. E. (1985). How Information Gives You Competitive Advantage.
Harvard Business Review. Retrieved from
https://www.gospi.fr/IMG/pdf/how_information_gives_you_competitive_advantage-
porter-hbr-1985.pdf.
Shaw, W. H., & Barry, V. E. (2016). Moral issues in business. South Melbourne, Victoria.
Cengage Learning.

Singhal, A. (2010). The Mahatma’s Message: Gandhi’s Contributions to the Art and Science
of Communication. China Media Research. Retrieved from
http://utminers.utep.edu/asinghal/Articles%20and%20Chapters/Singhal-Gandhi-
ChinaMediaResearch-2010.pdf.

Spiers, Joseph N. and Kjenneth A. Kovaly: 1975, 'An International Perspective on Business
Ethics,' Industry Week, (October 27), 30-4
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Tian, Q. (2007). Perception of Business Bribery in China: the Impact of Moral Philosophy.

Journal of Business Ethics, 80(3), 437–445. https://doi.org/10.1007/s10551-007-
9429-x.

Tsalikis, J., & Nwachukwu, O. (1991). A comparison of Nigerian to American views of

bribery and extortion in international commerce. Journal of Business Ethics, 10(2),
85–98. https://doi.org/10.1007/BF00383612.

Wu, X. (2008). Determinants of Bribery in Asian Firms: Evidence from the World Business
Environment Survey. Journal of Business Ethics, 87(1), 75–88.
https://doi.org/10.1007/s10551-008-9871-4.
Zhou, J. Q., & Peng, M. W. (2011). Does bribery help or hurt firm growth around the world?
Asia Pacific Journal of Management, 29(4), 907–921.
https://doi.org/10.1007/s10490-011-9274-4.
Take-Home Examination Cover Sheet (March 2020 Semester) MGT3044

Section B- Question 4
Introduction
According to Ludwig and Longenecker (1993), a young boy, David who was
courageous enough to protect his sheep from predators and defeated a giant Goliath when
he reached teenage. Thereafter, David became the King of Israel who was loved by
everyone, thus being the mightiest king ever in Israel. He is a principled leader who has a
strong sense of moral judgement and acting in a humble way. However, his capabilities and
power that enabled him to become successful had led him to his ethical failures. There are
a few reasons that have led to King David’s failure despite the power and wealth he had.
Firstly, David became overconfident and started to be absent in wars and asked his army to
fight for him. Additionally, he shifted his focus from the nation’s wars to Bathsheba, a
woman he felt in love with ever since he saw Bathsheba bathing on the rooftop from his
high palace. Instead of concerning the wars, he focused on inquiring Bathsheba’s
information. Then, David remain indifferent on the fact that Bathsheba had married with one
of his warriers under David’s amry, he insisted to force Bathsheba to conduct adultery with
him. Consequently, Bathsheba was pregnant with David’s child. Furthermore, David
ordered Bathsheba’s husband to fight in the battlefront to make him killed in the battle.
Although Bathsheba ended up marrying David, David’s unfortunate life began with his child
death and several tragedies happened, resulting in regrets of his own decisions made in the
past.

Factors
Firstly, one of the prime factors resulting in ethical violations by leaders in the
workplace is the loss of strategic focus when dealing with the by-product of success
(Stallard & Sanger, 2014). Successful leaders tend not to do what they are supposed to do.
For instance, the success in the past battles won by David left him complacent whereby he
had taken his victories for granted and be overconfident in his strategies. Therefore, such
complacency had led to his absenteeism in the upcoming battles as David assumed that his
right-hand man, Joab will lead the army well to win all battles with the existing strategies
(Ludwig & Longenecker, 1993). It may be wise that David delegated his duties to Joab with
the intention of cultivating leadership skills in Joab, however, David should oversee his
army to ensure strategies conducted are flawless. Instead of overseeing his army, he
shifted his majority focus on Bathsheba who was bathing from the focus on battlefield which
Take-Home Examination Cover Sheet (March 2020 Semester) MGT3044

he was supposed to do. It shows the delegation of duties was out of the sense of self-
satisfactions instead of the sense of necessity. Therefore, by-products of success which are
the ignorance of what was happening and not being where he is supposed to be will
eventually result in ethical failures especially in successful companies. For example,
complacency found in Nokia once brought disastrous impact in its performance. Nokia was
the leading company in the mobile phone industry, defeating Apple and Samsung.
However, its past outstanding performances in sales have formed strong complacency
within the company. It eventually causes Nokia’s leaders to remain indifferent to improve its
mobile phones to follow the pace of the changing technology like touch-screen technology
with the assumptions of ‘Nokia’s current functions being the best in the market (Denning,
2005). Consequently, its sales fell tremendously within a few years due to consumers’
preferences on technological-advanced mobile phones. In contrast, Apple and Samsung
that have been improving their mobile phones with latest technologies have become the
most profitable companies in the world. Based on utilitarianism, their actions of are ethical
as they are maximizing happiness in the society by providing the best mobile phones to the
public (Shaw & Barry, 2016). These companies will continue to grow as long as they do not
lose their strategic focus in improving their mobile phones from time to time.

Next, successful leaders tend to have the access to privileged information, people
and objectives (Stallard & Sanger, 2014). The view from top of the roof in the palace which
allowed David to see Bathsheba bathing implies that David with a higher status and
authority in the society can enjoy the privilege of breaching privacy of people of lower
status. However, David has forgotten that the view from the rooftop is not meant for breach
of privacy but for him to have the entire view of the city to lead his people (Forsyth, 2011).
Based on ethical egoism, it is ethical to satisfy David’s own interests despite the breach of
Bathsheba’s privacy. However, based on prima facie duty, David’s action is unethical as he
should not prioritise his self interest in breaching Bathsheba’s privacy over the obligations
to lead his people. Therefore, leaders treat their privileged position as a mean to obtain self-
indulgence instead of a tool to practise effective and efficient leadership will eventually lead
to ethical failures in the workplace. For instance, the implementation of sophisticated
surveillance and monitoring systems have been used by the employers to observe and
oversee their employees (Alge, 2001). According to a survey done by the American
Management Association (2001), more than 78% of employers are electronically monitoring
their employees Emails, contents browsed and computer activities with the excuse of
Take-Home Examination Cover Sheet (March 2020 Semester) MGT3044

overseeing their working performance. It shows that both past and current leaders are used
to invade privacy of people of lower status using their influence and power in the
community. Based on ethical egoism, computer surveillances are ethical to maximise
companies’ self-interest to ensure quality and efficiency of work done by employees.
Furthermore, since companies’ privacy invasion has intruded privacy of over 40million US
employees, the privacy concerns by the employees may outweigh the benefits gained
through computer surveillances to the companies (Botan, 1996). Hence, such privacy
invasion conducted by leaders in the workplace is unethical based on utilitarianism view.
Moreover, based on libertarianism, both David and current leaders who breached others
privacy have interfered their property rights from having their own privacy, hence
considering privacy invasion as an unethical action.

Furthermore, success may lead to unrestrained possessions of organizational

resources (Stallard & Sanger, 2014). In David’s case, he utilized his subordinates and
resources to request Bathsheba to commit adultery with him. Based on libertarianism, it is
apparently unethical to do so as David forced Bathsheba to commit adultery with him using
his resources he was granted in his position. Furthermore, David abused his power as a
king when he offered Bathsheba’s husband to retrieve from the battlefield to cover up
Bathsheba’s pregnancy which was caused by David. This has eventually failed the prima
facie duty that the authority granted to David is for him to lead his people but not for him to
achieve his own objectives, thus being unethical in misusing official authority to solve his
own issues which fails his duties towards his people. Similarly, the leader of Catholics,
Roger Vangheluwe was convicted of sexual abuses not only on children in church but also
his 15 years old nephew. He used his religious contents as means to sexually abuse these
children by brainwashing them to do whatever he orders (Reynaert, 2015). Consequently, it
shows how his success in Catholic’s community enables him to control the resources to
reach his own objectives. Based on Kantian Theory, it is unethical as he is using the
believers’ trusts as means to meet his own interest by persuading those children to accept
his sexual abuse. Based on utilitarianism, it is unethical as the physical and psychological
damages done on those children and the society will overweigh the satisfaction of the
bishop (Shaw & Barry, 2016).
Take-Home Examination Cover Sheet (March 2020 Semester) MGT3044

Solutions
Ethical failures have caused disastrous effects in companies. To solve these ethical
failures, there are a few ways to mitigate these issues in companies. One of the most
effective ways to cope with the by-product of success is that all leaders of the companies
are encouraged to live a balanced life to reduce the likelihood of the negative thoughts of
success (Muna & Mansour, 2009). By adopting a balanced lifestyle, leaders will realise that
there are things more valuable than being successful in their careers. For instance, leaders
should pay more attention on their family members, pick up hobbies and have adequate
rest to be mentally and physically healthy so that they will realise the meanings of achieving
other objectives in their life instead of merely striving for their career achievements.
Eventually, leaders will increase their working performance as they are not overly stressed
during work (Galinsky, Kim & Bond, 2001). Hence, leaders with less stressed during work
will create a less tensed working environment which will improve working performance of all
members due to higher efficiency and effectiveness of communications within the group.
With better working environment, all members will increase loyalty towards the company,
thus mitigating the risks of members accepting bribes to leak company’s information to
competitors (Muna & Mansour, 2009). Thus, leaders are less susceptible to take immoral
initiatives to achieve their goals. Furthermore, leaders will require supports from friends,
family and colleagues to avoid thinking negatively which will lead to ethical failures.
Next, the issues of ethical violations can be alleviated through whistleblowing
intentions and behaviours cultivated in employees in the workplace. Whistleblowing is the
disclosure made by members of the organisations of any illegal or immoral practices
conducted and controlled by their superiors which will negatively affect any internal or
external stakeholders (Near & Miceli, 1985). Employees may opt either internal
whistleblowing within their companies through reports to top management and independent
internal control team or external whistleblowing to the public through legal authorities and
mass media (Miceli & Near, 1992). Between these internal and external whistleblowing,
internal whistleblowing may be relatively ineffective as wrongdoings conducted by leaders
are frequently being ignored and buried to perform their fiduciary duties by protecting
companies’ reputation which is ethical under prima facie duty (Miceli & Near, 1992).
Therefore, employees are more susceptible to report externally to the legal authorities and
mass media which will trigger public scrutiny and legal intervention. For instance, in the
infamous WorldCom whistleblowing case, a member of WorldCom, Cynthia Cooper had
shown bravery and justice to reveal her superiors who had been threatening her to not to
Take-Home Examination Cover Sheet (March 2020 Semester) MGT3044

reveal the accounting frauds conducted by them (Anand, Ashforth & Joshi, 2004).
Therefore, it shows the rights and capabilities of employees to fight back against leaders
who has higher authority and conducted ethical violations. Therefore, leaders will hesitate
and improve self-control in executing any ethical violations.

Furthermore, strong internal control must be enforced in companies to oversee all

activities of leaders. To enhance internal control in companies, the roles of board of
directors are vital to supervise decision making and the management polices made by
leaders in each department. For instance, companies may set up a group of independent
board of directors who do not have material relationship with neither the company nor the
leaders to prevent bias treatments towards any leaders which strengthen the internal
control system in the companies (Sun, Yi & Lin, 2012). Therefore, leaders who have shown
ethical failures will be detected by the independent directors and being punished unbiasedly
since they are not related to any members in the company. Furthermore, the revised
Malaysian Code on Corporate Governance (MCCG) 2017 that has substantially introduced
guidelines and recommendations of governing companies in Malaysia has enabled
companies to minimize their weaknesses and strengthen their internal control system in all
companies especially large companies (Bhatt & Bhatt, 2017). For instance, the MCCG 2017
has established guidelines that emphasise on the transparency of both financial and non-
financial information and disclosures as well as the independence of internal auditors and
non-executive directors who have the role of overseeing the leaders to prevent abuse of
power on any members in the company (Bhatt & Bhatt, 2017). Hence, the possibility of
leaders practising ethical violations will be lower due to stronger internal control system in
the companies.

(1982 words)

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