Analyze The Effects Of Organizational Structure And Pay On The Ethical Behavior Of American Red Cross
The effects that organizational structure and compensation had on the ethical behavior of American Red Cross Executives, is that ARC was being charged of overcompensation of executives, as well as corruption among its board of executives. The frequent executive turnover and missuses of funds has weakened the organization. The organization has had years and years of underinvestment in telecommunication and technology, which hinders the organization from handling issues in a timely manner.
The American Red Cross’s reputation was tarnished because of the thousands of dollar that was awarded in large severance packages to their fired executives, raising the eye brows of stockholder and large donation givers. The American Red cross was known
as one of the best nonprofit organization in the country until investigation into the organization went public. Not only were the leadership issues at the top of the organization it had filtered down to the local chapters as well.
To name a few of the area where funds were mismanaged in local chapters, the first was Louisiana where a fundraiser was padding his bank account, in Pennsylvania the embezzlement of funds by a manager, in Maryland the forgery of purchase orders that was meant for victims, and the biggest charity fraud was in New Jersey where the chief executive and bookkeeper stole over a million dollars in funds.
According to an article called “Ethical Behavior as a Strategic Choice by Large Corporations” it stated that Firms that engage in illegal and unethical behavior are not likely to respond to the societal pressures that are aimed at improve the organizations ethical conduct (Sethi and Sama, 1998).
The American Red Cross’s reputation was tarnished because of the thousands of dollar that was awarded in large severance packages to their fired executives, raising the eye brows of stockholder and large donation givers. The American Red cross was known
as one of the best nonprofit organization in the country until investigation into the organization went public. Not only were the leadership issues at the top of the organization it had filtered down to the local chapters as well.
To name a few of the area where funds were mismanaged in local chapters, the first was Louisiana where a fundraiser was padding his bank account, in Pennsylvania the embezzlement of funds by a manager, in Maryland the forgery of purchase orders that was meant for victims, and the biggest charity fraud was in New Jersey where the chief executive and bookkeeper stole over a million dollars in funds.
According to an article called “Ethical Behavior as a Strategic Choice by Large Corporations” it stated that Firms that engage in illegal and unethical behavior are not likely to respond to the societal pressures that are aimed at improve the organizations ethical conduct (Sethi and Sama, 1998).