Mini-Case No. 4 Tax Evasion
1. Upon taking over, what do you think should the new CEO John Daughtry do in order to regain company trust?
2. How could he prevent further tax evasion cases and other criminal acts from happening again? 3. What are the significant ethical values embedded in the case that should be learned?
Response to Case Questions
Before taking the vital steps in regaining the public trust, Mr. John Daughtry must ensure that he focuses on solving the company problems. Solving the company's tax and its liabilities with other activities that indicated fraud must be his first significant matter to deal with (Luca,14). In sorting out the previous administration's mess, he should ensure the temporary or permanent closing down of all the other firms on the same company. After the closure, he should ensure that the employees who had been in the firms are competent and thus deserve the positions. If there are fraudulently hired employees, he should secure a change in the post and hire a better person. Mr. Daughtry should ensure a vacancy is advertised to the public should there be any and engage better company marketing strategies to appeal to the customers. He has to ensure that every action by the company is done according to the requirement of the law to ensure a peaceful ethical working environment with the law.
In preventing further tax evasion cases, Mr. Daughtry should ensure transparency and accountability among the workers to prevent further tax evasion cases or any vindictive activities. Before giving the final product to their customers, the company should ensure a detailed financial report and declaration of profits if done openly to the company. Investors and other service offering entities like creditors are usually the driving force of a company (Merks,272). Mr.Daughtry, therefore, should ensure that the firm makes a good impression on both sides. Many firms do not reveal the right income of their firms to avoid heavy taxation. A false declaration can lead to the closure of the firm if the federals fin out. Declaring the income justly, therefore, during taxation is vital to Mr. Daughtry and the company because they perform a responsibility to the government and thus avoids other tax evasion cases. They should lastly ensure that they declare the company wealth correctly to the law enforcers and point out if they have other firms under the same company.
Fairness, honesty, integrity, and transparency are the significant values embedded in the case that are vital. Fairness is the act of being impartial and without favoring any parties. By creating awareness of a vacancy in the company, Mr. Daughtry is fair to the public who would be interested in the position. The vacancy, therefore, is won by merit and not favoritism. Integrity involves being truthful, straightforward, and having strong moral principles. By ensuring that the firm employs competent workers, it upholds the virtue of integrity. Honesty is the character of frankness, sincerity, and truthfulness. Transparency involves being open about an act (Engelbrecht et al., 6). By declaring the correct income of the company and its wealth, the new C.E.O employs the virtue of transparency. If Mr. Daughtry enforces these virtues in the company and ensures the company workers follow these virtues, the company avoids further problems that could cost it. By cultivating these in the workers, they perform accordingly even without supervision and add to the company positively.
Engelbrecht, Amos S., Bright Mahembe, and Janneke Wolmarans. "Effect of ethical leadership and climate on effectiveness." SA Journal of Human Resource Management 15.1 (2017): 1-8.
Luca, Christiaan. "Guest Editorial: Regain Trust by Aligning with Society´ s Needs." Journal of Petroleum Technology 70.06 (2018): 14-15.
Merks, Paulus. "Tax evasion, tax avoidance, and tax planning." Interfax 34 (2006): 272.