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					Running Header: CASH OR CONSCIENCE?

                           Cash or Conscience?

             Four Modern Examples of Business Ethics Decisions

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       There are those who joke that the term “business ethics” is an oxymoron. While

the ideal outcome of a free market economy is a collection of businesses whose owners

who have earned every penny by honest, hard work, there are plenty of business owners

who have made their way to the top of their particular market by cheating others, by

sacrificing all ethical questions on the altar of the bottom line, or by making the

difference between right and wrong a distinction that is subservient to the profit margin.

For every one of these corporate villains, however, there are scores of questions that fall

into a grayer category. This sort of question involves companies that either intentionally,

or effectively, push the envelope of legitimate business ethics to its limit in pursuit of

profits – or are at least perceived as having done so.

       One clear example of nefarious business ethics involves the case of Robert Penn,

who masterminded a regional mortgage fraud scheme that ruined the credit ratings of

many African-Americans in Martinsville, Va. He promised some of his fellow residents

the chance to join a “real estate investment group” that would give each investor a share

of considerable profits, while shielding each investor from liability. The only

requirement that Penn had was that the investors give him their Social Security numbers,

so that he could check out their credit ratings. After a flurry of purchasing paperwork

that, in most cases, confused the other investors, Penn’s scheme was off and running. It

took several months for the investors to realize that Penn was a fraud. One of the

investors went to his credit union for a small loan and was told that he owed nearly $1

million in mortgage debt – home purchases that he had authorized as part of Penn’s

fraudulent scheme. Penn would buy homes at market value, but have them appraised at
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several times above market value, and keep the difference between the cost of the home

and the amount of the loans. Part of the paperwork established him as the manager of the

group’s funds (Bashir). And so, while he had the “right” to take out these loans, because

of what was signed under fraudulent conditions, it was certainly not “right” for him to run

up debts for other people, particularly since he invoked race and religion to get his seed


         A significantly less cut-and-dried issue is a decision by Wal-Mart to install in-

store health clinics, staffed by nurse practitioners. These clinics lease space from the

store, and charge patients a flat fee for their visit. For patients who have no health

insurance, this is a far cheaper alternative than a trip to the emergency room. Some

concerns include the fact that doctors’ offices will still have to deal with the more

complex patients but lose the “easy” revenue of colds, immunizations, and other minor

ailments that nurse practitioners can treat (Moran and Herman). The possibility also

exists that a patient could be treated by someone who does not know complex factors in

his/her medical history if s/he visits multiple providers. These concerns, however, are not

keeping people from visiting these clinics.

         An area that is rife for ethical abuse involves the ways in which profits are

accounted and distributed in the music industry. A prime example is the case of Meat

Loaf, who has performed two successful “Bat Out of Hell” rock operas and is set to

release a third on October 31. Despite the fact that his first opera sold 23 million copies

after its release in 1977, Meat Loaf ended up in bankruptcy in the mid-1980’s, as a result

of litigation between him and his songwriter, Jim Steinman. The same wrangling over

profit-sharing and artistic recognition, including whose name(s) would go on the cover of
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the album, threatened to ruin their second collaboration, and has kept them apart for the

final opera (Roberts). In other words, the ambiguities that make art what it is have no

place in the black-and-white world of legal contracts.

        A fourth example of a business ethics question involves Netflix, the successful

DVD rental distributor. Analysts and investors are concerned that Netflix is spending too

much of its revenue on marketing, given the actual size of the video rental market that is

open to receiving DVD’s by mail and, eventually, renting downloads of popular movies

(Schneidermann). The question becomes a matter of how a company should spend its

money, and how it should protect its investors. Would it be right to distribute profits, or

to keep attempting growth?

        Each of these examples of business ethics decisions brings to mind Justice

Stewart’s maxim that “there is a big difference between what we have the right to do and

what is right.” Except for the first example, each of these situations has parties on both

sides of the ethical question that think that they, are of course, are in the right.
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                                    Works Cited

Bashir, Martin. 2006. “Giant Scam? Real Estate Dreams Dashed, Debts Mount.” ABC
        News Online 6 October 2006. Accessed 24 October 2006 at

Moran, Terry and Herman, Charles. 2006. “Future of Health Care or Quick Fix?” ABC
      News Online 17 October 2006. Accessed 24 October 2006 at

Roberts, Johnnie L. 2006. “Meat Loaf: It’s All Gravy.” Newsweek 9 October 2006.
       Accessed 24 October 2006 at

Schneiderman, R.M. 2006. “Update – Netflix Beats the Street.” Forbes Online 24
       October 2006. Accessed 26 October 2006 at