" No one would want to be taken advantage of the way Countrywide did, and under no circumstances did they themselves believe their actions were "right."
Egoism or self-interest ethics may explain the Countrywide rationale, after all, they were acting to advance own interests, over all else. Although some conduct is "right" when it advances personal interests, Countrywide's motive was actual "greed" because greed includes "excess" -- demanding more than one is entitled to. Egoism assumes that there is no "entitlement," others also have interests, and interests can and should compete. No one is "more deserving" than another. This also is Adam Smith's view of the market: buyers and suppliers with opposing interests (buyers want the lowest price and suppliers want the highest price) seek a transaction, to buy or to sell. Countrywide so skewed the negotiations in their own best interests that Mr. Smith would have been appalled.
Pursuant to the ethics of social group relativism, we assess Countrywide's conduct by understanding what our social group expects of us. While the term "relativism" has been misunderstood to imply that "anything goes," here the term simply means that standards of conduct in business are governed by the expectations of others on our behavior. "We conform." Countrywide obviously did not.
Each of these categories identifies a different kind of standard for making choices, and refers to some interest that is valued or preferred. We may not share the same interest or preference, but this is not an argument for what some call "situational" ethics -- ethical behavior that may, or may not, differ with circumstances.
Questions
What aspects of the situation (actions by any stakeholder) demonstrate ethically sound behavior and which illustrate unethical behavior?
Sadly, until the Attorneys General pursued Countrywide for consumer fraud, securing an $8.68 Billion settlement for defrauded borrowers, no one acted ethically. Not Countrywide, and in some instances, not the homeowners either, where they acquiesced in the lies.
Analyze how the company's corporate culture that may have helped to minimize the unethical behavior or actually contributed to/caused the unethical behavior.
The corporate culture at Countrywide included a "Friends of Angelo" scheme that gave low interest loans to members of congress. The order of the day was profit, from any action, and the profits were divvied up in the billions.
Analyze how the company's corporate governance (overall guidelines, strategic decisions/actions) may have helped to minimize the unethical behavior or actually contributed to/caused the unethical behavior.
Few situations are as saturated in misconduct as the Countrywide debacle. In short, there was no governance whatsoever. Now that Bank of America bought the company, their guidelines and rules will apply as necessary to wholly alter the previous absence of law or ethics. All new personnel are necessary.
Based on the ethical perspectives (theories of ethical thought presented in the course), what are the key factors that should be addressed or considered in resolving the legal/ethical issues identified in this case (as outlined above)?
This entire episode mandates further oversight, and congress is still examining these issues. The primary lesson...
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