The Role of Accounting in Society-Free-Samples-Myassignmenthelp

Question: Discuss about the Role of Accounting in Society. Answer: Unethical Issues in Seven Eleven As per 7 Eleven (2018) it is an American chain of convenience stores which is known worldwide. It is a Japanese owned chain and is headquartered in Irving, Texas. Seven Eleven Japan Co. Ltd is headquartered in Chiyoda, Tokyo and it is owned by Seven I Holdings Co. It has employed around 45000 employees in its stores. The company supplies proprietary food and continues to innovate new edible products for its time constrained consumers. However, in 2015, the company was accused to use unlawful and unfair labor practices to decrease its labor costs in its stores located in Australia. The young and foreign laborers who were working at the companys stores had been paid less than 50 % of the minimum wage rate. This problem continued for some time in the company and it was confronted by every person who was employed in the company. As a result, the chairperson of Seven Eleven , Mr. Russ Withers and the CEO Mr. Warren Wilmot resigned from their designations. It was stated that the wage rate of the laborers were intentionally kept low to keep the costs down and the profits increased for the benefit of the franchisers and the parent company (Zi?czuk, Cichorzewska and Walczewski , 2013) . The workers were paid for every alternate hour and the foreign laborers were threatened to be reported if the lodged any complaints to the higher authorities. They were paid $ 12 per hour which was below the minimum wage rate. Also, they were paid wages for 20 hours a week while they worked for around 40-60 hours a week. The payment of low wages was also reported in 2016 in which it was found by the Fair Work Ombudsman that the franchisees paid full payment to the workers and afterwards half of the payment was to be given back to them by the workers. The reason behind this was that the executives and the head offices were receiving 57 % of the gross profits while the stores received the rest 47 % of the revenue. It became difficult for them to manage the huge staff cost from this meager amount. It led to the exploitation of the workers (Ogbari et al., 2016). The stakeholders affected in this scandal are the employees who were paid less than their working hours. Also, the future owners of the franchisees and the customers were affected as nobody would like to commercially transact with the unethical company. The parent company 7-Eleven Malaysia Holdings Berhad which was listed on the Malaysian Stock Exchange saw a sudden downfall in the value of its shares .The return on the shares was also affected due to the loss of goodwill of the company. After the scandal was settled, the workers left the company and the new ones were reluctant to join it. So, it had a negative impact on its operations (Bieler and Lee, 2016). The decisions made by the involved parties in this issue was unethical and it affected badly on the operational activities of the business. In this case, the workers specially the international students who worked in the stores were blackmailed to be reported to the immigration department if they spoke about the low wage rates. After the allegations, the franchisees stated that it was impossible for the company to earn profits without exploiting the employees which was completely unethical (Ollus, 2016). The unethical activities of the company led to its downfall in the market. According to Fair Work Ombudsman (2016) as a result of various investigations on the company for not complying with the Federal Workplace Laws .The franchisees of the company were falsifying the records regarding the payment of wages to the workers (KPMG, 2015). It had a great impact on the future owners of the franchisees and the customers of the company. They withdrew themselves from the operations of the company. After the settlement of the scams, the employees left the company and the new ones were reluctant to join it. This further had an influence on the downfall in the value of the shares and the returns of the parent company which was listed on the Malaysian Stock Exchange. Before I joined the lecture, I related ethics to moral principles which arise in the business environment. After attending the lectures, I felt that the ethical principles such as individualism, utilitarianism , Kantianism and the virtual theories are manipulated by the organizations for their own benefit and selfish interest. The ethical principles are meant for the common good and not for the benefit of the upper class of the society (Adeyeye et al., 2015). Hence, to conclude, it can be said that the environment of the company sets the tone for its employees and it should provide an ethical framework so that the employees and the management can be motivated for behaving responsibly. The ethical framework of 7 -11 lacked internal control systems regarding the payment of wages References 7 Eleven (2018) About Us [online] Available from: https://corp.7-eleven.com/corp/about#corp_about_intro [Accessed 9th April 2018]. Adeyeye, J.O., Adeniji, A. A., Osinbanjo, A.O., Oludayo, O.A. (2015) Effects of Workplace Ethics on Employees and Organizational Productivity in Nigeria. International Conference on African Development Issues [online] Available from: https://pdfs.semanticscholar.org/123e/bf2aa954d98622997fe03c1da8f5e800d603.pdf[Accessed 9th April 2018]. Bieler, A. and Lee, C.Y. (2016) Exploitation and resistance: a comparative analysis of the Chinese cheap labor electronics and high-value added IT sectors. Globalizations. DOI : 10.1080/14747731.2016.1204698. Fair Work Ombudsman (2016) Statement on 7-Eleven [online] Available from: https://www.fairwork.gov.au/about-us/news-and-media-releases/2016-media-releases/april-2016/20160409-7-eleven-presser[Accessed 9th April 2018]. KPMG (2015) Fraud Ethics at the Workplace in Switzerland[online] Available from: https://assets.kpmg.com/content/dam/kpmg/pdf/2016/04/ch-fraud-and-ethics-at-the-workplace-in-switzerland-brochure-en.pdf [Accessed 9th April 2018]. Ogbari, M.E., Oke, A.O., Ibukunoluwa, A.A. , Ajagbe, M.A. and Ologbo, A.C. (2016)Entrepreneurship and Business Ethics: Implications on Corporate Performance. International Journal of Economics and Financial Issues. 6(S3), pp. 50-58. Ollus, N. (2016) Forced Flexibility and Exploitation: Experiences of Migrant Workers in the Cleaning Industry. Nordic Journal of Working Life Studies. 6(1),pp. 25-45. Zi?czuk, B., Cichorzewska, M. and Walczewski , M.(2013) The Analysis of Unethical Behavior Among Employees In Enterprises A Pilot Study in The Automotive Industry. Management Knowledge and Learning International Conference 2013 [online] Available from: https://www.toknowpress.net/ISBN/978-961-6914-02-4/papers/ML13-249.pdf [Accessed 9th April 2018].