Business ethics and social responsibility affects customers, businesses, shareholders, and the reputation of the organization. A business that is dishonest can cause harm or even send an individual to jail. Several forms of doing business are through sole proprietorship, partnership, and corporation. Sole proprietorship is more favorable because this represents in dependency for the owner. Partnerships are popular because they produce the most revenue and have two or more partners. The board of directors, officers, and an executive committee supervise a corporation. Merck Pharmaceutical is a professional corporation managed by physicians, accountants, attorneys, and dentists.
The shareholders own no personal liability for any debts, as in any other corporation except for professional malpractice claims. The corporate veil will not (the corporate veil will give protection) give individuals personal immunity for negligence through incorporation. Major white-collar crimes such as stock fraud are on the rise, dominating business in every industry. Consumers are threatened by businesses who want to take the consumer's money and provide no service and poor quality products.
Enterprise Liability: The corporate owners and executives of Merck are held to a higher standard because of their position and level of responsibility. The government implemented rules and regulations and for adherence by corporate management to prevent all types of fraud or crime. If such individuals are found at fault of deceptive crimes and actions, they face a greater penalty than the average employee. The penalties applied to organizations include fines, restitution, sanctions, forfeiture, and corporate probation (Richmond, 1997).
[...] The Executive Board also advises on strategic consideration for the company. The Executive Board passes resolutions in meetings held on a bi-monthly basis (Annual Report, 2009). The Supervisory Board monitors the functions the management of the company by the Executive Board. Limitations of the role of the Supervisory Board exists because the liability of the Executive Board partners and accountability for the company's management. The Supervisory Board cannot appoint or dismiss general partners or regulate contract terms or conditions (Very good business/legal observations & distinction points) (Annual Report, 2009). [...]
[...] Corporations can help eliminate abuse of power by screening all applicants. An appointed committee can review documents, cross check paperwork, and examine the transfer and receipt of cash ensuring all existing liabilities are paid in a timely manner. Additionally, seek expert legal and financial advice if in doubt about making a transaction or decision, and disallow the corporation from continuing to procure goods and services on credit if the organization is incapable of clearing these debts when due (Richmond, 1997). [...]
[...] References Corporate Governance Accountability (2008). Retrieved on March 25, 2009 from website http://iba-worldwide.com Clayton Utz. (2010). Retrieved on March 25, 2010 from website http://www.claytonutz.com Find Law. (2008). Retrieved on March 25, 2010 from website http://nwcn.injury.findlaw.com Mallor, Jane P. (2003). Business Law: The Ethical, global and E-Commerce Environment (12ed.). Retrieved from University of Phoenix LAW/531 – Business Law Course web site Merck, Code of Conduct, Our Values and Standards, Edition II. Retrieved March 27, 2010, website https://merck.com/about/110605_US.pdf Merck News Release (2008). [...]
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