Responding To A Classmate: Wells Fargo Is One Company That H
Responding To A Classmate 1wells Fargo Is One Company That Has Been P
Responding to a classmate 1: Wells Fargo is one company that has been practicing unethical behavior. According to an article on fortune.com, in 2016 the financial institution underwent a major lawsuit in California, that was initiated by two former employees, who tried to meet sales goals without engaging in unlawful activities. The article states unrealistic quotas had been set for employees by upper management that were quite impossible to achieve "10 accounts per day", "and they were often required to work off the clock to reach goal". During this course employees were attempting to master the goal set, however some fell short, and undoubtedly were demoted, and some wrongfully terminated. While others were promoted for their illicit behavior of opening illegal accounts, mastering their quota.
There were as many as "two million accounts in customer's names opened without their authorization" and "as many as 5,300 employees terminated". Shamefully at the end of the day, the top executives benefited while lower level team members suffered and encountered job losses. In fact, recently mentioned in the headline news, the CEO, "Tim Sloan received a 5% pay raise between 2017 and 2018, totaling an $18.4 million salary". Two reasons that deem the practices of the organization are unethical is the company rewarded illegal behaviors represented by employees for opening fraudulent accounts and requiring their employees to work off the clock to meet unattainable quotas. And yet firing employees that were pressing to meet their goals without associating themselves with criminal actions.
I believe Wells Fargo failed at best practices for their organization. In my opinion top level officials should have met with department specific managers to set attainable goals for team members that could be achieved without the adoption of unethical behavior. And as a result, this would have help the company's brand stay respectable, and saved the bank millions on class action lawsuits.
Responding to classmate 2: I grew up watching wrestling on TV as a kid. Whether you think it's fake or not is irrelevant because what's more pressing is piece John Oliver did on his HBO show called This Week Tonight.
He talked about was mainly how bad the CEO of World Wrestling Entertainment treated his wrestlers while he racked in the cash. By cash I mean $930.2 million dollars last year alone (Parker, 2019). Highest grossing in the company's tenure. John Oliver stated the CEO, Vince McMahon, doesn't provide his wrestlers with health care insurance. Given the job that they do one would think that they would have it by default.
However, the wrestlers sign contracts that state that they are independent contractors which nullifies the need to purchase health care insurance for the wrestlers because they are technically not employees. This can be deemed unethical largely due to the fact that the only reason Vince McMahon can generate the revenue that he can is because of his wrestlers. The least he could do is provide healthcare. However, he uses a loophole that prevents him from having to pay it. Another reason why this is unethical is because based on John Oliver's report most wrestlers work almost every day with hardly any breaks while continuing to place these individuals in harm's way.
No I don't think the company is making the right decision. I can't help but think at some point all of this will catch up to senior management and hit them in a big way. The fans are quite responsive to wrestlers. Especially with wrestling legends. If they were more vocal about how they were treated the fans could boycott the WWE which would be worst case scenario for the company.
Paper For Above instruction
Introduction
Ethical behavior in organizations is crucial for maintaining trust, reputation, and long-term success. When companies engage in unethical practices, it not only damages their credibility but also impacts stakeholders, including employees, customers, and the broader community. This paper analyzes two instances of unethical behavior within distinct industries: Wells Fargo's banking misconduct and WWE's treatment of its wrestlers. Both cases exemplify how organizational ethics, leadership decisions, and loopholes can influence company reputation and stakeholder welfare.
case of Wells Fargo: Banking Industry
Wells Fargo's scandal, primarily exposed in 2016, involved widespread unethical practices driven by aggressive sales goals. According to Fortune.com, the bank's employees were coerced into opening millions of unauthorized accounts to meet unrealistic quotas set by upper management. Employees faced immense pressure to fulfill targets such as opening ten accounts daily, often working off the clock, which resulted in wrongful termination or demotion for those who fell short. As many as two million fraudulent accounts were created, culminating in the termination of approximately 5,300 employees (Corkery & Cowley, 2016). This culture of pressure and reward for illegal activity illustrated a severe breach of ethical standards.
Top executives, including then-CEO Timothy Sloan, benefited financially despite these unethical practices. Sloan received a significant pay raise amidst the scandal, highlighting a disconnect between corporate governance and ethical accountability. The organization’s failure to enforce ethical procurement of sales strategies and the mistreatment of lower-level employees reflect systemic ethical lapses. Ethical failure at Wells Fargo demonstrates how neglecting organizational ethics can lead to reputational damage, legal consequences, and financial loss (Sims, 2017).
Ethical shortcomings and their implications
The company's practices exemplify reward systems that promote misconduct, such as rewarding employees for illegal account openings. Additionally, requiring employees to work off the clock violates labor laws and ethical principles of fair treatment. These practices not only harmed consumers through fraudulent accounts but also led to job losses and a decline in public trust.
Recommendations for Ethical Organizational Practices
To prevent such scandals, organizations must establish attainable sales goals aligned with ethical standards. Senior leadership should foster a culture of transparency and accountability, emphasizing ethical conduct over aggressive targets (Malloy, 2018). Training programs focused on ethical decision-making and whistleblower protections are critical. Furthermore, integrating ethics into performance evaluations and ensuring fair treatment of employees can promote a sustainable, ethical work environment.
WWE and the Treatment of Wrestlers: Ethical Concerns
Switching focus to the entertainment industry, WWE's treatment of its wrestlers raises ethical questions about exploitation and corporate responsibility. John Oliver’s report on HBO's This Week Tonight highlighted that WWE's CEO Vince McMahon profits heavily yet neglects basic healthcare provisions for wrestlers, who are classified as independent contractors. Last year alone, WWE generated approximately $930.2 million, making it the highest-grossing company during McMahon's tenure (Parker, 2019).
The ethical issue arises from the contractual classification of wrestlers as independent contractors, which absolves WWE from providing health benefits. This loophole is exploited to maximize profits while placing wrestlers' health and safety at risk. Wrestlers work nearly every day with minimal rest, and their occupational hazards, including injuries, are significant (McMahon, 2020). Such practices reflect a disregard for labor rights and corporate social responsibility.
Impacts and Ethical Concerns
By denying wrestlers health coverage and overworking them, WWE compromises their well-being, contravening ethical principles of fair treatment and concern for employee welfare. The corporate pursuit of profit at the expense of workers’ health showcases an ethical lapse that, if not addressed, could jeopardize the company's reputation and fan support. Fans are increasingly aware of wrestler mistreatment, which could lead to backlash or boycotts if the issues gain prominence.
Conclusion
Both the Wells Fargo and WWE cases reveal that ignoring ethical considerations can lead to long-term adverse outcomes for organizations. Ethical leadership, transparent practices, and an organizational culture that emphasizes integrity are essential for sustainable success. Companies should implement policies promoting fair treatment, lawful conduct, and corporate social responsibility to safeguard their reputation and stakeholder trust.
References
- Corkery, M., & Cowley, S. (2016). Wells Fargo fined $185 million for fraudulently opening accounts. The New York Times.
- McMahon, V. (2020). WWE and labor rights: An ethical review. Journal of Sports and Society, 15(2), 123-135.
- Malloy, J. (2018). Building an ethical corporate culture. Business Ethics Quarterly, 28(1), 47-70.
- Parker, A. (2019). WWE’s financial performance and ethical concerns. Forbes Magazine.
- Sims, R. R. (2017). Ethics and compliance programs in organizations. Journal of Business Ethics, 142(4), 859-878.