BUS FPX 4801 Assessment 2 Company Ethical Issue Identification
Phillip February 28, 2024 No Comments

BUS FPX 4801 Assessment 2 Company Ethical Issue Identification

BUS FPX 4801 Assessment 2 Company Ethical Issue Identification

Name

Capella university

BUS-FPX4801 Ethics and Enterprise

Prof. Name

Date

Abstract

Economic growth implies an improvement in quality of life; however, corporate compensation policies often concentrate wealth among a select few, leading to harmful societal effects. This paper examines the ethical dilemma posed by disproportionate wealth distribution and its consequences for society. Additionally, it proposes a solution to address this issue.

The Ethical Dilemma: Money, Money Everywhere, but Not a Drop for You

Revenue per employee (RPE) serves as a metric for evaluating companies’ revenue efficiency, yet it fails to consider capital investment. Despite this limitation, it highlights the essential relationship between employees and revenue (Urosevic, 2021). However, corporate upper management increasingly disconnects from this reality, with C-suite employees often being the sole beneficiaries of increased profits. This disconnect is evident in the widening gap between CEO and worker compensation, rising from 21-to-1 in 1965 to 351-to-1 in 2020 (Kandra & Mishel, 2021). Such disparity is exemplified by Apple, where the median employee salary is significantly lower than CEO compensation and profit per employee (Carpenter, 2021; Romburgh, 2019; Vanian, 2020). This trend underscores the ethical dilemma of undervaluing employee contributions while disproportionately rewarding executives.

The Consequences of Greed

The prevailing corporate culture of prioritizing profits over fair compensation exacerbates socioeconomic inequality, leading to adverse effects on society. Decades of profit-driven practices, including outsourcing and pension program eliminations, have particularly impacted the working class, with many individuals facing financial insecurity and an uncertain retirement future (Ballard, 2021; Wallach, 2020). This economic disparity not only undermines societal well-being but also threatens corporations’ long-term sustainability by potentially eroding consumer demand.

An Absurdly Simple Solution

Addressing this ethical crisis necessitates a fundamental shift in corporate policy towards equitable employee compensation. While implementing such changes may not yield immediate uniform benefits due to varying corporate profitability, it represents a crucial step towards mitigating exploitation and fostering social equality. The notion that profit is a choice underscores the ethical imperative for corporations to prioritize employee well-being over excessive wealth accumulation (Wikipedia Contributors, 2021). By reorienting corporate values towards fair compensation, society can alleviate the detrimental impacts of economic inequality and promote a more sustainable future.

Conclusion

In conclusion, the disproportionate distribution of wealth within corporations poses significant ethical challenges with far-reaching consequences for society. By prioritizing equitable employee compensation, corporations can address these issues and contribute to a more just and sustainable economic landscape. Ultimately, the pursuit of profit should not come at the expense of human dignity and societal welfare.

References

Ballard, J. (2021). About a quarter of Americans don’t think they will ever be able to retire comfortably. YouGov. Retrieved from https://today.yougov.com/topics/economy/articles-reports/2021/09/13/retire-comfortablygeneration-industry-poll-data

Carpenter, S. (2021, August 26). Apple CEO Poised to Get $750 Million Final Payout From Award. Bloomberg. Retrieved from https://www.bloomberg.com/news/articles/2021-08-26/apple-ceo-poised-to-get-750-million-final-payout-from-big-award

Kandra, J., & Mishel, L. (2021, August 10). CEO pay has skyrocketed 1,322% since 1978 Economic Policy Institute. Retrieved from https://www.epi.org/publication/ceo-pay-in-2020

Romburgh, M. von. (2019, January 15). This is how much Apple pays a typical employee — and how that compares to Google, Facebook, Netflix, Microsoft, Box and more. Silicon Valley Business Journals. Retrieved from https://www.bizjournals.com/sanjose/news/2019/10/01/median-salaries-tech-goog-nflxsplunk-netapp-intc.html

Urosevic, M. (2021, June 15). Revenue per employee [the added value of labor]. SpendMeNot. Retrieved from https://spendmenot.com/blog/revenue-per-employee

BUS FPX 4801 Assessment 2 Company Ethical Issue Identification

Vanian, J. (2020, August 25). Here’s how much these tech giants are making in profit per employee. Fortune. Retrieved from https://fortune.com/2020/08/24/apple-microsoft-facebook-amazon-alphabet-profit-per-employee

Wallach, O. (2020, December 2). Charting The Growing Generational Wealth Gap. Visual Capitalist. Retrieved from https://www.visualcapitalist.com/charting-the-growing-generational-wealth-gap/

Wikipedia Contributors. (2021, September 2). Chance for Peace speech. Wikipedia; Wikimedia Foundation. Retrieved from https://en.wikipedia.org/wiki/Chance_for_Peace_speech

Wikipedia Contributors. (2021, November 9). List of countries by total wealth. Wikipedia; Wikimedia Foundation. Retrieved from https://en.wikipedia.org/wiki/List_of_countries_by_total_wealth

Williams, C. (2020, September 28). Millennials Were Already Putting Off Having Children. Then the Pandemic Hit. Morning Consult; Morning Consult. Retrieved from https://morningconsult.com/2020/09/28/millennials-economy-children-poll/

BUS FPX 4801 Assessment 2 Company Ethical Issue Identification