Wells Fargo Ethical Case
Even though Wells Fargo was given a fine by a court of law, the total loss as a result of the fine could be easily recovered by Wells Fargo. Since Wells Fargo is a big company, the fine did not affect the company in a big way as compared to the loss that the former clients of the company underwent. Unlike the company, the clients could not recover the loss they experienced as well as the mental suffering they had to endure. Therefore, the net social benefit was not maximized given that fact that Wells Fargo was in position to recover the money paid as a fine.
Deontological approach requires one to evaluate the morality of any action based on whether the action itself is right or wrong. Therefore, the morality of an action is based on human will. Even though Wells Fargo is streamlining its internal policies to prevent future occurrence of such an event, the loss incurred by former customers cannot be addressed by such steps. Universalizability principle requires that the former customers should have been compensated. Wells Fargo approach to streamlining its internal controls is not enough and as such, the former clients ought to be compensated for the loss suffered as a result of Wells Fargo’s incompetence. When employees are not directly compensated for the loss suffered, then it will set a bad trend for other companies in the banking and other financial industries. Companies will believe that they also can do the same and same fate that befell Wells Fargo will be the order of the day. To prevent such illegal and criminal activities to occur again in the industry, Wells Fargo should be forced to adequately compensate the former customers who lost money. The compensation should be directly to the customers in addition to the fine. This will prevent any fraudulent activities happening in future since companies will be aware of the financial cost that they will have to incur.Wells Fargo Ethical Case
The principle of “rights of responsibilities” requires organizations to hold all the employees from top to the bottom accountable for their actions. Wells Fargo failed to follow this principle by not holding its employees accountable for their actions of creating millions of fake accounts. Wells Fargo punished junior employees who were being pressured my management to create fake accounts due to unrealistic targets. 5300 junior employees were terminated from their work while the top level employees still held their jobs except for two of them. These higher ranked employees were supposed to monitor what junior employees were doing and they were not held answerable to their actions. The leadership failed in its role of monitoring what was going on in the company which eventually led to this scandal. It was the responsibility of the leadership to have detected irregular activities and summoned the employees who carrying out these fraudulent activities. Overall, when one compares the number of employees who were terminated from work to that of those in leadership which was only two, it is clear that the leadership of Wells Fargo squarely lay the blame on employees. It was unfair to majorly terminate employees while the main beneficiaries of such activities were the top management. Wells Fargo should have fired all the managers who were supposed to ensure that no illegal or fraudulent activities were carried out by employees. Moreover, it was the managers who had given employees unrealistic targets which forced them to create fake accounts. It was unfair to blame the employees which was demonstrated through termination.Wells Fargo Ethical Case