Answer two discussion questions and reply to two discussion answers from students.
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An Ethical Choice
A Culture of Compassion
This exercise contributes to:
Learning Objective: Compare the functional and dysfunctional effects of organizational culture on people and the
Learning Outcome: Describe best practices for creating and sustaining organizational cultures
AASCB: Ethical understanding and reasoning; Reflective thinking
In the world of banking, success and ethical culture dont necessarily go hand in hand. Leaders
who desire ethical cultures in their organizations must choose to build ethics into the companys
definition of success in ways that translate into ethical actions for managers and employees.
Contrast two financial success stories, Goldman Sachs and Wells Fargo. Both megabanks are
among the Fortune 100 (the largest U.S. companies ranked by revenue). They are also two of
Fortunes Worlds Most Admired Companies, a list that ranks the largest companies in revenue
by nine criteria including social responsibility. Yet their organizational cultures appear to be
vastly different. Goldman Sachs seems to struggle to achieve an ethical culture for its employees
and clients, while Wells Fargo seems to emanate a culture of compassion. Consider some recent
Mefit Mike Mecevic was a loyal janitor for Goldman Sachs when Superstorm Sandy hit
New York in 2012. Mecevic and his coworkers rode out the storm in the companys
Manhattan skyscraper and worked nonstop for days to keep floodwaters back. Then a
Goldman Sachs manager threw him out without explanation. Mecevic said to him, I live in
Staten Island, there’s a state of emergency, there are no cars, no trains, no lights. The water is
up to our necks. I was begging for my life. But he said ‘Leave the building. Mecevic
implored two other managers to help him, to no avail. He left but was later fired anyway. I
worked day and night, Mecevic said. They destroyed my life for nothing. Nothing.
Wells Fargo is committed to respecting its clients, even when those clients are in trouble. For
the past few years, it has held Home Preservation Workshops where indebted homeowners
can meet with home retention team members in confidential booths set up in large halls
across the United States. Clients bring paperwork specific to their cases, and team members
negotiate binding agreements. One client said, It is a great feeling to not worry about
losing her home.
Organizational culture is where leaders ethical choices demonstrate their expectations for
others decisions throughout the company. Both Goldman and Wells Fargo enjoy stellar
reputations. But these examples suggest that the two companies make very different ethical
choices with respect to their cultures.
Answer two discussion questions
Google the phrase wells fargo scandals and discuss the
effects of these incidences on the culture described in this
article. Did the leaders at Wells Fargo abandon their culture
of compassion? Support your answer with concepts from
Wells Fargo no longer enjoys a stellar reputation. Discuss
how they got to this point, using concepts from An Ethical
Culture on p. 544. Can they ever re-gain a culture of
compassion? Explain your answer.
REPLY TO THE TWO DISCUSSION ANSWERS
The fraudulent accounts made the bank extra fees that allowed Wells
Fargo workers to increase their sales. This sort of scandal negatively
effects the ethical work climate because it undermines the ideas of right
and wrong established by the company. The leaders of the company
definitely abandoned their culture of compassion because it essentially
robbed their clients of their hard earned money.
After committing such fraud with their customers it is to no surprise to me
that Wells Fargo no longer enjoys a stellar reputation. According to page
544 there are certain principles that must be met in order to create an
ethical culture. These principles include communicating ethical
expectations and providing ethical training. The wording of these principles
makes it sound like only those in leadership roles can demonstrate them.
Because there was no clear visible role model for these employees due to
the lack of demonstrating ethical principles it was assumed ok to not
convey them. I don’t see how Wells Fargo can build back from this scandal
anytime soon, it is going to take a lot of years and hard work to re-gain a
culture of compassion.
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