Assignment 3: The American Red Cross (ARC)”
October 28, 2012
HRM 522 Ethics & Advocacy For HR Pro

Determine the impact of this event on ARC’s “benefits of business ethics” (employee commitment, investor loyalty, customer satisfaction, and bottom line). Business ethics includes the principles and standards that guide behavior in the world of business. The ethical behavior of a company is being judged and determined by its stakeholders. They may not always be right but their judgment affects the company’s reputation in society. There are several benefits of business ethics. Ethics contribute to (Ferrell, Fraedrich, & Ferrell, 2011, pp. 18-21): * Employee commitment – comes from employees who believe their future is tied to …show more content…

“As a nonprofit organization, the ARC should always take steps to ensure impartiality” (Ferrell, Fraedrich, & Ferrell, 2011, p. 332). Some believed this was not the case. In each of these cases the needs of the stakeholders were not being met. The American Red Cross needed to take steps to improve their response to events similar to the attack on the World Trade Center and national disasters like Hurricane Katrina. Government agencies were quick to address some of the concerns of the public regarding the American Red Cross but the American Red Cross needs to put forth a better effort to abide by the rules and standards set forth by the International Federation of Red Cross and Red Crescent Societies.
Determine and discuss the ways in which ARC’s corporate governance failed to provide formalized responsibility to their stakeholders. Determine and discuss the ways in which ARC’s corporate governance failed to provide formalized responsibility to their stakeholders. Corporate governance is formal system of accountability, oversight, and control companies put in place to remove the opportunity for employees to make unethical decisions (Ferrell, Fraedrich, & Ferrell, 2011, p. 42). Ferrell, et al. goes further and give the following definitions for each aspect of this system: * Accountability refers to how closely workplace decisions are aligned with a firm’s stated