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Ethics: One of the Most Critical Issues Facing Manger's
In my opinion, one of the most critical issues facing managers is ethics. One definition of ethics is the code or moral principles and values that govern the behavior of a person or group with respect to what is right or wrong. (Daft, 2013) This is a basic issue that employees and manager's face every day. This is a concern for all businesses regardless of the organization. I have been affiliated with the mortgage industry for over 22 years. In 2008 there was a major collapsed or as it was referred to a major meltdown in the industry which is believed to have originated from the lack of good sound ethical behavior. What measures should manager's in this industry use going forward to help ensure that ethical practices are implemented and followed?
Many individuals believe that the mortgage collapse of 2008 was caused by unethical behavior on the part of several sources. However, it is believed that it initially began with lenders, particularly the mortgage salespeople or the originator of the loan transaction. There is evident in the article by Joseph Gilbert in which he states "at least partly because individuals at the front end of the process made decisions that were ethically or morally wrong." (Gilbert,
2011, p 91. ) The average mortgage salesperson works more like an independent contractor. There is very little supervision, great demand for production and most mortgage salesperson’s work on a commission basis. Mortgage salespeople worked very long hours and had the opportunity to generate a great deal of business, as well as, a very lucrative income. In most cases the income was insurmountable. Coupled with that, was the opportunity that was afforded by the mortgage lenders who relaxed its underwriting guidelines and produced products that required very little, if any documentation from the consumer to verify the ability to repay the
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mortgage that was being provided. It...