BUsiness ethics

1. GROUP-2 ( EPGDIB):
SHARAD GARG -25A
VIJENDERA SETHI -33A
KANUPRIYA -10A
SOUMYADIP SETT -29A

2. Wall Street (1987) is a film set
in New York City about
investing through the stock
exchange on insider
knowledge. The film exposes
the ruthless, capitalistic
tendencies of businessmen
who will stop at nothing to
make a fortune. The movie
features Charlie Sheen who
plays the protagonist Bud Fox,
a young intelligent stock
broker, alongside Michael
Douglas, who depicts Gordon
Gekko, an extremely wealthy
Wall Street corporate raider.

3. Bud Fox – Protagonist of the story.
 He comes from a modest middle
class family.
 He believes that success is
achieved through hard work.
 Bud’s father, Carl Fox ,is the
President of the Union at Blue-
star Airlines.
 Bud’s friend Marvin works with
him at the broker firm.
Mr Gordon Gekko -Wealthy Wall Street corporate raider.
 A multimillionaire who preys on broken companies.
 Gekko will jump start Bud’s career.
 Fox uses Blue Star proprietary information to bate Gekko.
 Bud stands Gekko’s attention focused on BlueStar, he
purchases BlueStar stock.
 Geeko fools Fox, as he pulls him into a sea of deceit.

4.  Fox’s relationship with Gekko is dependent on Fox seeking
inside information, manipulating stock values and making a
profit no matter what the cost.
 Bud mismanages information and betrays his loyalties in order
to get to the top by failing to assume his responsibilities as a
stock broker.
 Bud provides the powerful man with insider information about
Bluestar Airlines, the company his dad has been working in for
decades
 Through spying, Bud deduced that Sir Larry is interested in
acquiring Anacott Steel.
 Gekko orders Fox to start buying the stock, passing the word
around and falsely inflating the price to 51 1/8. This later
results in Sir Larry purchasing Gekko’s shares at a premium.

5. • Fox began to rely much on insider trading for Gekko.
• In this movie- With sheer desperation to impress Geeko, Bud
provides the powerful man with insider information about
Bluestar Airlines, the company his dad has been working in for
decades. The information he shares is not yet public
knowledge, thus illegal to trade off.
• Fox used a lawyer friend who helped by taking confidential
trading information and manipulating the information for profit
return
• Fox failed to assume his responsibilities as a stock broker by
illegal inside trading.
• This kind of trading is illegal and the SEC ends up arresting
him for it.

6.  Turn of events leaves Fox in the hot seat.
 He is brought in for criminal charges by the
SEC, essentially taking the fall for Gekko.
 Fox got to see the error of his ways and
cooperate with federal officials to bring
Gekko the justice he deserves.
 The film ends as Bud approaches the
courthouse ready to face the
consequences of his actions.
At the end of the movie, Bud exposes
Gekko for the fraud he is, however Bud is
still guilty and faces possible time behind
bars. Despite his presumable sentence, Bud
regains his moral conscious and rekindles
relationship with his father, knowing that he
must face the consequences for his money
hungry actions.

7.  Market-based corporate governance systems place the
responsibility of corporate management on investors.
 To provide investors and stakeholders with a clear idea of a
company's direction and business integrity.
 Market-based corporate governance systems benefit from their
ability to respond dynamically to changes and loop holes.
 It can lessen the potential for financial loss also it helps to build
trust with investors, the community, and public officials.
 Good corporate governance creates transparent rules and
controls, provides guidance to leadership, and aligns the
interests of shareholders, directors, management, and
employees.
 It can facilitate the raising of capital and good corporate
governance can translate to rising share prices.
Need for Governance in NYSE :
This movie gives a wonderful insight on what can be the consequences of a
firm/market if it fails to have a robust governance and ethics which is managed
by a regulatory body, independent of any power or influence .

8.  In 1895, the Exchange recommended that companies issue a full
report of their annual operations at least 15 days before the
shareholder meeting.
 In 1899, the team began requiring regular financial statements of all
listed companies.
 The team supported one share, one vote initiatives in 1926 and the
establishment of proxy solicitation regulations in 1927.
 The team urged listed companies to have at least two outside
directors on the board starting in 1956.
 In 1977, team required that listed companies have independent audit
committees comprised of outside directors.
 In 1999, well before Sarbanes-Oxley Act of 2002 (SOX) regulations,
the team required domestic listed companies to have audit
committees of at least three independent directors, and set financial
expertise requirements for the committees.

9.  The Dodd-Frank Act targeted financial system sectors that were
believed to have caused the 2007–2008 financial crisis.
 Leading up to 2007, lax regulations led to extremely risky lending
practices, which caused a housing sector bubble that ultimately burst
and drove the global crisis, the need for public bailouts of financial
institutions, and recession.
 Those institutions seen as responsible included banks, insurance
companies, investment banking firms, mortgage lenders, and credit
rating agencies.
 Critics of the law argue that the regulatory burdens it imposes could
make U.S. firms less competitive than their foreign counterparts.
The remarkable legislation passed by U.S congress after the financial crisis of
2007–2008. It sought to make the U.S. financial system safer for consumers and
taxpayers.

10. Most nations have a stock market, and each is regulated by a local
financial regulator or monetary authority, or institute. The SEC is the
regulatory body charged with overseeing the U.S. stock market.
 The SEC is a federal agency that works independently of the
government and without political pressure.
 The mission of the SEC is stated as “protecting investors,
maintaining fair, orderly, and efficient markets, and facilitating capital
formation.
 Companies listed on the stock market exchanges are regulated, and
their dealings are monitored by the SEC.
 Failure to adhere to the regulations can lead to suspension of
trading and other disciplinary measures.