CORPORATE CODES OF CONDUCT AND BUSINESS PRINCIPLES IN LIGHT OF THE GOLDMAN SACHS LAWSUIT SETTLEMENT

Marion S. Mogielnicki

Review of Business and Finance Studies, 2011, vol. 2, issue 1, 57-68

Abstract: The Securities and Exchange Commission recently settled a monumental lawsuit against the investment firm of Goldman Sachs, Inc. The settlement mandated that the Wall Street titan agree to strengthen its ethical policies and procedures. This paper will discuss Goldman Sachs as a complicated corporate entity and examine its relationship to its own Code of Conduct and Ethics in light of the lawsuit. It will present an historical perspective and a summary of the research and efficacy of Codes. This review postulates that business should implement their Codes and ethical programs by way of thorough and effective analysis of new investment products such as mortgage-backed securities. It explains how Goldman should have better utilized ethical mechanisms to examine these products. The paper condenses the more relevant recommendations of the Report of the Business Standards Committee of Goldman Sachs. Finally, this review evaluates the definition of waivers contained in Codes and concludes that businesses should eliminate this exception.

Keywords: Ethics; Implementation; Code of Conduct or Ethics; Business Principles; Business Standards Committee; Waiver; Conflict of Interest; SEC; Abacus; Mortgage Backed Securities (search for similar items in EconPapers)
JEL-codes: K19 K22 K42 (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (1)

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