Ethics in Financial Management - Essay Example

ETHICS IN FINANCE APA Style R.Preeti 25/4/2008 ETHICS IN FINANCIAL MANAGEMENT Ethics is generally concerned with an individual's activities and perception about morality, alongside his differentiation between right and wrong. Very often, one's perception on ethics various from that of the others', due to personal experiences, mentality, background and the influence of near and dear ones. When we perform actions and take steps in life, we often do sit back and reflect on the ethical value of our actions.

In other words, we do analyse if we are being ethical in leading our lives and sticking to what is morally right. In today's world, organisations and workplaces have become extremely diversified and have adopted varied stance s in terms of job processes and the general outlook. What is striking in such a scenario, is the prevalence of organizational or work ethics. Ethics has evolved to become an important aspect of organizational functioning, since it deals with the self-esteem and the very importance attached to employees in an organisation.

Is it but well known, that an employee is the building block of an organisation and the importance attached to ethics in today's organisations are a reflection of the same.Financial Code of Ethics is important for the smooth functioning of any organisation. One of the important aspects of financial code of ethics, is to maintain integrity in the generation of accounts. One must ensure the hierarchal accountability and must also adhere to strict confidentiality and secrecy.

It is also important to make use of the independence given and to maintain high levels of honesty and transparency.The Enron scandal was something that rocked the business world and also inspired books and movies based on it. Fake accounts and balances maintained were revealed publically and the bankrupt company, that hid behind the facade of a prosperous one, were exposed. [Reported by Adam Lashinsky, November 30, 2001, Bankrupt Analysis, for New York Times]Keeping in mind such a scandal, one can lay down the ethics in financial management.

The financial objectives of my organisation, is definitely to show the actual expenditures incurred and the real profits reaped. A false claim of accounts, either in terms fo profits or losses, is definitely not ethical. In addition to this, the proper paying of taxes and maintenance of such accounts is also ethical.In keeping with these ethical considerations, my organization has made sure that all the accounts and financial deals are made public to stake-holders and employees, since they form an integral part of the organisation.

In addition to this, taxes have been paid properly, with greater independence attached to employees. Trust, independence and a checks and balances system help diminish the gap between control and independence.Thus, financial code of ethics forms an integral part of the organization's work culture and it is through this ethical display of work, does the organization manage to retain loyalty and trust.REFERENCESAdam Lashinsky, November 30, 2001, Bankrupt Analysis , Website: http://www.nytimes.com/2001/11/30/opinion/30LASH.

htmltodaysheadlines=&pagewanted=print'Code of Ethics for Senior Officers and Finance Associates', Website: http://www.ecolab.com/investor/governance/CodeofEthics.asp'Business Ethics', Al Thomas, Website: www.ezinearticles.com