Reference no: EM133178335

Based on the readings and your experience, explain how employers put themselves at potential risk with reporting on issues that lead to financial risks.Demonstrate more depth and thought than saying things like "I agree" or "You are wrong." 

The accounting and finance professions often act as "watchdogs" to ensure that everyone is "playing by the rules and conforming to the conditions that ensure the market functions as it is supposed to function" (Hartman, DesJardins, & MacDonald, 2021, p.104). These professions act as intermediaries between their clients and other participants in the market. They evaluate, audit, and verify client information so that other participants can make informed decisions regarding the financial creditworthiness of those clients. This can, at times, result in conflicts of interest that place these intermediaries at risk when reporting issues. Conflicts of interest occur when parties have competing interests or obligations that make it difficult to ethically fulfill their duties.

There are several ways to avoid or mitigate risks that result from conflicts of interest. One solution is full transparency. Notify all stakeholders involved in the conflict. This makes everyone aware from the start and allows each to voice any concerns and to provide input on how to proceed (Hartman et al., 2021, p.104). A second way to mitigate this type of risk would be to remove yourself from the process entirely. This is a similar action to a recusal that takes place in a legal setting. For example, a judge, prosecutor, or juror may recuse themselves from the proceedings when they have personal knowledge or involvement with someone in a case. This is a common practice that can help to eliminate any concerns regarding bias or impartiality.

References

Hartman, L. P., DesJardins, J., & MacDonald, C. (2021). Business ethics: Decision making for personal integrity and social responsibility (5th ed.). 2 Penn Plaza, New York, NY: McGraw-Hill Education.