Research paper in APA style on Business Ethics and Financial Scandals on AIG (Am

Question

Research paper in APA style on Business Ethics and Financial Scandals on AIG (American International Group).

In paper explain following:

1. The company and its business.

2. What behavior the company exhibited prior to the ethic incident.

3. Describe in detail the unethical action the company was involved in.

Explain the following:

a. The situation.

b. What unethical behavior or action took place?

c. Corporate offices involved.

d. Any other stakeholder involved.

e. Managerial and Leadership implications and impact on stakeholders.

f. Legal Ramifications.

4. Describe the outcomes of the situation.

5. How did it affect the company?

6. How did it affect the employees?

7. How did it affect other stakeholders?

8. How did it affect society?

9. Did something good come out of the situation?

10. Can it be prevented? How?

11. Conclusions – the Final recap of important points.

Explanation / Answer

American International group is an American multinational insurance company giving insurances to individuals and businesses. Before the ethical incident that took place in the financial crises in 2008, the company was growing rapidly, entering new markets and expanding globally successfully. But slowly by 2005 the accounting scandals came to limelight. They also insured huge amount of derivatives without buying reinsurance to cover the risk associated with it. Also it had to pay the insurance claims and losses as it used collateral on deposit to purchase the mortgaged backed securities.

The company was involved in the unethical action when the government bailed out $180 billion to them to save them from a situation of bankruptcy as that would effect the other firms trading with the bug company like AIG adversly. But it was found out that the company paid huge amounts from the bailout money to the top executives of the company as bonus money, funded their vacations and private jet flights, and expensive luxurious retreats. The group that got benefitted in this incident were the top executives of the company and not any stockholders, employees, investers or customers. It was an unethical act being practised unequally just obliging a group of executives and not any other stakeholders.

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