|Type of paper:||Essay|
|Categories:||Economics Loyalty Business ethics Leadership style|
Loyalty to the Firm
Markham faced a challenge concerning his loyalty to the firm (Novy-Marx & Rauh, 2009). The facility was mindless on the way of organizing the stakeholders and employees of the firm concerning the liability of a mess that can take place due to poor leadership. For that matter, Harry Markham portrayed to be loyal by avoiding discrepancies and carelessness in his leadership skills (Novy-Marx & Rauh, 2009).
Loyalty to the Boards of Trustees
The board of trustees necessitated that they did not want to hear any information that the funds' liability was more than the amount that was captured by Government Accounting Standards Board abbreviated as GASB. Since the firm wanted to keep the board of Trustees satisfied and more importantly, happy, Markham worked extra hard to make sound investments. He was also affiliated to the responsibility of giving sound advice to the trustees by working from the finances that were grossly misleading. Markham maintained his moral actions as a way of enhancing the loyalty of the trustees, pensioners and the firm at large.
Loyalty to Pensioners
The argument of economists that it was inappropriate to discount liabilities at an expected return on assets became a challenge on 8% rate as reflected on aspects of over-optimistic expectations on future profits. In that perspective, it was a dilemma for Markham to come to a conclusion that could uphold the loyalty of all the stakeholders of the firm. Markham concluded that employing a juicy investment with little to reap would cost the organization with time according to the value of the pensions. Thus he opted to be sincere at the low-risk discount rate.
The Ethical Systems that I would Use to Provide an Explanation
The code of ethics and professional standards are the basis that can be used to explain rejecting the 8% percent discounted rate on pensioners. Since it is evident that bad numbers in investments result into future unprecedented challenges, I would allude to the need for fully following the ethical rule in coming with a reasonable conclusion (Brown & Wilcox, 2009). There is the need for sponsors to make a reasonable investments decision as there is the need to focus on necessary precursors for sound investments.
The Impact on the Ethical Systems
Focusing on loyalty before advising the investors is a sign or responsible leadership. The advice to the investors will offer a chance for coming up with a reasonable investment in the firm. Additionally, the rate on pensioners will be liable for all the stakeholders amid helping the stakeholders to avoid poor decisions in their investments (Brown & Wilcox, 2009). Reasonable expectations will result in strong profit projection. Thus the firm will be able to grow.
Impact on Customers, Leadership, and Workers
The effect of the ethical dilemma is more felt by the workers. The customers will always allude to the services and products provided, but the leadership will be blamed for failing to provide stakeholders with the required data concerning the success of the organization. The administration of Markham was on blame for the challenges (Brown & Wilcox, 2009). The top management will be blamed for a mistake that was brought up by a list of stakeholders in the line of speculating risky situations and who are responsible for minimizing crisis through speaking up. Good governance can challenge the blames and the impact of assuming the directives of Markham.
Brown, J. R., & Wilcox, D. W. (2009). Discounting state and local pension liabilities. American Economic Review, 99(2), 538-42.
Novy-Marx, R., & Rauh, J. D. (2009). The liabilities and risks of state-sponsored pension plans. Journal of Economic Perspectives, 23(4), 191-210.
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Free Essay Sample about Local Pension Liabilities: Loyalty and Ethical Systems. (2022, Aug 01). Retrieved from https://speedypaper.com/essays/free-essay-sample-on-loyalty-and-ethical-systems
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