Corporate Governance in Private Organization. In the wake of corporate scandal, widespread unethical behavior, and illegal activity in some of our most respected organizations, corporate governance in both public and private organizations is undergoing possibly the greatest change since the original creation of the Securities and Exchange Commission during the 1930s. The Sarbanes-Oxley Act of 2002 formalized many new white-collar crimes, set stiff penalties for such crimes, and is impacting every element of Board governance from independent membership and financial competency, to employee whistle blowing and the role of auditors.
Until recently, few organizations seriously considered ethics to be a legitimate topic for enterprise planning and strategic thinking. Those at the top of an enterprise regularly spent time developing their organizational and functional strategic plans, their growth strategy, possibly even their brand strategy, but ethics and regulatory compliance was merely an issue for the finance department, legal counsel, and possibly human resources.
“The Ethical Crisis in America” – A Status Report (2005). In America, the bursting of the so-called “dot-com bubble,” led to an unfolding ethical crisis that has expanded to become multinational, and now, global in its occurrence.