analyst‘s dilemma
1. Sam has to make an ethical decision immediately. He faces a dilemma of whether to send the fax as Linda tells him to do or not to commit Linda’s command. If he sends the fax, he will violate business ethics and his personal religion ethics. The consequences may involve both the loss of Sam’s personal moral prestige and the collapse of FirstAmerica’s corporate reputation among the financial industry. If he doesn’t send the fax, he will disobey his direct superior Linda with risk of ending his career in FirstAmerica or the whole financial industry.
2. Will my decision be damaging my client or my company?
Could this decision involve a choice between a good or bad alternative, or perhaps between two “goods” or tow “bads”?
What rights or duties are at issue?
Do other similar situations exits from which I can draw conclusions
Duties: 1) The duty of loyalty to his clients: according to CFA standard III (A), FirstAmerica must carry out the investment actions in the best interest of the Poseidon. Which indicates that Sam has the duty to clarify the actual “slippage” cost and three to five-year French borrowing rates for a corporation with Poseidon’s credit rating.
2) The duty of loyalty to his employers: according to CFA standard IV (A), Sam should also consider the effects of his conduct on the sustainability and integrity of the employer firm. To send the fax may help FirstAmerica execute a large and profitable transaction at an extremely hard time and may even improve bank’s share price. However, gouging an old major client could have a tremendous negative impact on the long run.
Rights: The right to disobey Linda when Sam feels the command violates the business ethics.
Best Practices: Sam could report the situation to the sales manager, Peter, that Linda misreported to the CFO the net profits on the deal of approximately $1.2 million instead of the actual fee of $12.5 million that Linda charges over Poseidon.
Sam could take the issue still higher
2. Will my decision be damaging my client or my company?
Could this decision involve a choice between a good or bad alternative, or perhaps between two “goods” or tow “bads”?
What rights or duties are at issue?
Do other similar situations exits from which I can draw conclusions
Duties: 1) The duty of loyalty to his clients: according to CFA standard III (A), FirstAmerica must carry out the investment actions in the best interest of the Poseidon. Which indicates that Sam has the duty to clarify the actual “slippage” cost and three to five-year French borrowing rates for a corporation with Poseidon’s credit rating.
2) The duty of loyalty to his employers: according to CFA standard IV (A), Sam should also consider the effects of his conduct on the sustainability and integrity of the employer firm. To send the fax may help FirstAmerica execute a large and profitable transaction at an extremely hard time and may even improve bank’s share price. However, gouging an old major client could have a tremendous negative impact on the long run.
Rights: The right to disobey Linda when Sam feels the command violates the business ethics.
Best Practices: Sam could report the situation to the sales manager, Peter, that Linda misreported to the CFO the net profits on the deal of approximately $1.2 million instead of the actual fee of $12.5 million that Linda charges over Poseidon.
Sam could take the issue still higher