In my opinion, I would say that the action taken by General Electrical Capital was unethical. The company decided to sell $11billion of long-term debts without informing investors. A few days later the company filed documents in preparation for another $50 billion debt. Ethics entails rules that govern the behavior of a person. Therefore, General Electrical Capital would have acted ethically by involving the opinion or ideas of the investors when making the decision. The investors have the right to know what is going on in their company since they are the majority shareholders. Similarly, since they are ones buying the bonds, they play a role in determining the impact of the bond on the anticipated earnings of the corporation. It is unethical for investors to get information after the action or decision had already been made. Moreover, it is also possible that the investors might not agree with the action taken by the company since they were not involved in decision making. Such a move by the investors will adversely affect the company.
Besides, the action taken by General Electrical Capital was not only unethical but illegal as well. According to Bill Gross, a manager of a bond investment fund, the debt deal carried by the corporation lacked truthfulness. The Corporation demonstrated a shocking example of how investors are mistreated. Investors have the legal right to access company information. Also, they have the legal right to be involved in decision-making process. Therefore, when negative information about corporate earnings, accounting and management persist, investors would be the ones who will get hurt.
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