Ethics in Workplace: Role of Top Management - Report Sample

Paper Type:  Report
Pages:  7
Wordcount:  1872 Words
Date:  2023-11-06


In the modern-day workplaces, ethics play a critical role in ensuring that the public image of the entities are protected as well as the productivity of the workers is enhanced. In an organizational setting, it has become a practice for human resource departments to develop a code of ethics for their workforce and to oversee its implementation (Elson & Ingram, 2018). However, the issue of ethics does not stop at the internal organizational levels; the top management also has an obligation of making decisions that do not flaunt the industry-accepted standards of ethics and other standards of doing business. Organizational ethical dilemma entails a situation that forces a business entity to respond to a decision of a situation that affects their stakeholders, employees, consumers, or the general community. In the quest for organizations to maximize their profits, management has found themselves making decisions that are contradictory with the acceptable standards of ethics and have ended up tainting the reputation of their organizations (Cavico & Mujtaba, 2017). Wells Fargo is one of the many organizations that have come to the public limelight for having implemented unethical business strategies, which eventually led to the loss of customer trust as well as reduced financial turnover. Strict adherence to organizational ethical practices is one of the surest ways in which organizations can maintain their positive brand image and compete favorably in the murky business environments that they operate in.

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Analysis of Wells Fargo Scandal

In 2016, the Wells Fargo account fraud scandal was unearthed in what was termed the gravest ethical violation ever to be reported in the US financial world (Tayan, 2019). Wells Fargo was accused of having engaged in fraud by opening multiple accounts for their clients without their consent. The cross-selling practice that ensued after the illegal opening of accounts made the clients lose billions of money to the benefit of the organization. In a bid to make profits and attract more customers, the management of Wells Fargo put in place a workforce management system that required employees to reach a threshold number of accounts (Cavico & Mujtaba, 2017). The pressure given to employees to attain certain numbers compelled them to open illegal accounts on behalf of their clients without their consent just to meet the requirements set by the company. As a result, Wells Fargo fraudulently became one of the largest financial investment companies in terms of customer base owing to the millions of fake accounts that had been created.

The scandal came to the limelight in 2016 when clients realized an increase in the unanticipated fees charged to them after having received unexpected debit and credit cards (Tayan, 2019). The Wells Fargo case brings to light a number of ethical issues relating to how internal cultures within an organization can influence its public perception. The need for the organization to meet its growth objectives may make them act in a manner that exploits customers or employees for them to realize their goals. The analysis of the Wells Fargo case reveals that the organization made unethical decisions as pertains to the culture of compelling its employees to reach certain targets regarding the number of accounts that they open (Elson & Ingram, 2018). The pressure that the superiors exerted on their juniors is arguably the reason as to why some of them engaged in the fraudulent opening of accounts. Wells Fargo top management was accused for failing to take responsibility for the pressure that they exerted on their employees which compelled them to open fake accounts to meet the number required on them.

One of the testimonies given by a Wells Fargo employee during a public inquiry on the accounts opening scandal revealed that their supervisors were aware of the fraudulent opening of accounts but did not take any actions since they too had a quota to achieve and numbers to show to the management (Tayan, 2019). The focus of the company on incentives, as opposed to authenticity, made employees to fake their numbers for them to receive the benefits of reaching their quotas at the expense of their unsuspecting clients. In the Wells Fargo case, it can be argued that the employees acted unethically since they had a choice to make on whether to forego incentives or not. At the same time, Wells Fargo management acted unethically for failing to scrutinize the numbers that its employees gave or implement ethical practices in the organization (Cavico & Mujtaba, 2017). The fact that some of the organization’s top management was aware of the fake numbers and did not raise the alarm only means that the management was complacent with the on goings, thus raising ethical violations on the part of the top management.

Alternatives for Wells Fargo

In the account opening scandal done by Wells Fargo accounts managers as well as sales representatives, there are a number of actions that could have been undertaken differently to avoid such an outcome. Wells Fargo should have avoided implementing its business strategy that puts pressure on the employees to meet certain targets for them to get appraisals or keep their jobs. In an environment where employees are put under pressure, there is a high likelihood that the outcome of their actions will be inconsiderate of the means they use to attain their numbers (Elson & Ingram, 2018). When setting its goals, Wells Fargo should have involved the input of their employees to ensure that the goals set are meaningful and reflect what is happening at the implementation level. When the goals of the employees are aligned to the organizational vision, it becomes easy for entities such as Wells Fargo to realize progress in a manner that is in line with ethical standards of business operation. Organizations should avoid the habit of blending their goals with the job security of their employees to avoid compelling them to use unorthodox means to meet their targets and preserve their jobs.

Wells Fargo would have avoided the accounts opening scandal that dealt a big blow by putting in place data verification strategies that would have isolated fake accounts from the legitimate ones. The organizations’ top management ought to have realized the importance of employee supervision and the importance of modern technology when it comes to verification of the information submitted by employees towards a certain purpose. Wells Fargo’s management had accused its employees of having done the fraud under their own decisions. However, the fact that the organization has a vertical chain of command, the actions of the employees at the lower level are accountable by their supervisors thus making the management culpable. However, to avoid such an occurrence, it would have worked well for the organization is there were verification strategies that are concerned with the account dormancy issues, email account names as well as customer complaints on account issues (Cavico & Mujtaba, 2017). With such strategies in place, it would have been easier for the organization to point out the areas that raise red flags and identify such loopholes before they get out of hand.

There ought to have an internal organizational change within the top management of the organization. The excessive focus of the organization on having huge customer numbers is the reason why there was no red flags raised by the management even after identifying flaws in their numbers. The willingness of the organization to adopt modern data science technologies would have saved the organization from the reputational breakdown, given that the strategies would have helped it monitor its numbers.

Responsible Parties for the Wells Fargo Scandal

The Wells Fargo accounts scandal is a making of the organizations’ top management to start with. The failure of the top management to put in place strategies for checks played a critical role in allowing employees to operate freely. The failure of the organization to have technological data science mechanisms for checking the numbers of the accounts as well as their authenticity makes the top management of the organization to be responsible for the scandal given that it is the entity that is tasked with making important decisions. The executives of Wells Fargo can be said to be responsible for the scandal because of their role in the adoption of a business and operational strategy that puts pressure on the employees to meet certain targets. From first principles, the pressure exerted by the supervisors towards the workforce is said to be the reason that compelled many to fake account information for them to meet their targets and keep their jobs. He aggressive sales quotas that the organization had put on their sales representatives is arguably the driving force behind the creation of over two million customer accounts without their knowledge (Elson & Ingram, 2018). The executives are to blame for the toxic employee relationships within the company owing to the need to exert pressure for them to perform and meet their sales quotas.

On the flip side of the coin, the employees, on their part, were responsible for the accounts opening scandal. In any given organization, employees are bound by the ethical code of conduct that they sign when completing their job contracts (Mumley, 2019). Having submitted into abiding by their code of conduct, it was the responsibility of the employees to give accurate information to their organizations even when working without supervision. The employees of Wells Fargo that were charged with the opening of customer accounts ought to have relied on accurate information and report any incidences of workmates acting in a manner that violates the signed ethical code of conduct (Cavico & Mujtaba, 2017). The back stops at the person who creates a fake account with prior knowledge that their actions constitute ethical violations. No wonder, after the scandal was unmasked, a good number of Wells Fargo employees were sacked for their role in the scandal. Additionally, employees have the responsibility of refusing to be a party to unethical practices even if their actions may affect their standing at the work place or cost them their jobs.


The prevailing financial business environment in the industry that Wells Fargo was operating in can be said to be the reason behind the actions undertaken by the organization which eventually led to the scandal. In the financial business environment, the success of an organization is measured on the basis of the customer base that it enjoys as well as the financial turn over that it possesses. When potential clients are making the decision on the company to open an account with, they consider the customer base that the organization of their choice have. With such considerations in place, Wells Fargo was compelled to put in place aggressive operational management strategies that concentrated on the numbers that an employee brings to the table for them to get incentives. The pressure that the supervisors gave their juniors regarding the number of accounts that they would have opened over a given time frame was derived by the pressure that the organization had to meet the industry needs and have a competitive advantage (Mumley, 2019). The desire of Wells Fargo to minimize costs may have also compelled the organization to avoid investing in advertising to get the customer account numbers and instead resort to using unorthodox methods to get public validation.

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Ethics in Workplace: Role of Top Management - Report Sample. (2023, Nov 06). Retrieved from

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