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Based in the US, JPMorgan Chase & Company is multinational financial services and banking holding business entity. Being the largest bank in the US and ranked fifth in the whole world, the bank has experienced longstanding problems mainly associated with lack of integrity in business dealings. For instance, JPMorgan Chase had a long record of unethical as well as unlawful business practices between 2005 and 2015.
As a result of the company's failure to observe corporate code of ethics in its operations, the firm has faced numerous fraud charges and lawsuits evolving from selling risky products particularly subprime mortgages by use of illegal payment schemes, rigging transactions, manipulative conduct, in addition to providing misleading financial data. In light of the above, it is, therefore, clear that JPMorgan Chase needs to re-design its intervention strategy to minimize unethical corporate conduct that ought to be implemented fully within a period of twelve months.
Similarly, the company has to introduce rapid changes in its corporate culture and start utilizing ethical principles in decision-making and its business practices. All these transformations must be fully ratified within the business entity in a period not exceeding twelve months.
Organizational Development Intervention
In general, for companies to be successful in their daily operations and fairly compete in the global market, they ought to observe integrity as well as ethical issues. Also, both leadership and managerial teams should be strong and focused as well as ready to lead other stakeholders towards achieving the organization's common goals. However, failure for any business entity to establish a code of conduct may result in unethical practices on the part of the management and stakeholders, which may, in turn, tarnish the firm's reputation.
As is the case of JPMorgan Chase & Co., the multinational financial services and banking holding is facing numerous challenges occasioned by the management's failure to observe ethical issues in its daily activities. Therefore, for JPMorgan Chase to eradicate unethical practices, this giant banking institution needs to reengineer its corporate code of ethics and appoint new executive leaders and managerial teams who would be ready to support integrity and ethical conduct through leading by example.
The banking sector has been blamed repeatedly for flouting setting regulations to benefit from unfair business practices. Almost every major banking institution has incurred penalties from the regulators for breaking the established banking code. JPMorgan Chase is not an exception; the company has been accused of engaging in banking practices that border unethical conduct several times (Chen, 2015). Good organizational behavior is a major requirement in any institution that is focused on success and integrity.
Therefore, first of all, for JPMorgan Chase to be on the right track and conduct its business dealings with integrity, the company should consider changing its organizational code of conduct. In essence, the behavior of any entity is a determinant factor of either the firm's success or its failure (Hitt, Miller, & Colella, 2015). JPMorgan Chase should, therefore, alter its behavior as an organization to avoid court battles that the company is engaged in as the result of its current corporate conduct. For instance, the company should set rules and regulations to which every stakeholder, especially the top management, should adhere.
Secondly, JPMorgan Chase is in needs to define its corporate culture on which it should base all its business activities. With the corporate culture, the current organizational behavior in which the company is carrying out its financial activities will be gradually diminished, since all the business entities stakeholders will be required to operate within the established corporate culture.
Ordinarily, organizational management is tasked with planning, organizing, leading, and controlling company resources. However, to ensure success on the part of the authorities, more has to be done to guarantee effective management of the firm's resources. For instance, the management ought to embrace leadership to successfully and efficiently plan, organize and control the corporation's resources, since, in the current era, people expect to be led as opposed to being managed. About JPMorgan Chase company, it is apparent that effective management is lacking.
For a renowned business entity to be involved in legal issues arising from unethical practices, it is evident that the managerial team has failed to effectively plan for the organization's resources. Similarly, the management has failed to manage activities going on at JPMorgan Chase, thus stakeholders are involved in unethical practices at their own will.
Therefore, the company should consider changing the current management team and replace it with an effective management team that will not only invest its energy in ensuring that JPMorgan Chase remains top on the global market, but also support the integrity and ethical principles to avoid dragging the financial company to legal issues over its failure to meet both ethical requirements and legal regulations guiding the financial and banking activities.
More so, the replaced management should be in a good position to effectively manage stakeholders and make sure that they observe ethics as they carry out their daily duties. In other words, the management should plan, organize, lead and control the company's resources while observing the corporate code of ethics and by the law.
Best business practices are an essential element of business success. Notably, any business organization aiming at success both locally and globally has to establish good business practices in place. In particular, the latter involves abiding by the corporate code of ethics in carrying out business activities as well as in decision-making. Failure to establish good business practices results in unethical activities as is the situation of JPMorgan Chase & Co. To avoid the negative limelight, the company should review its business practices and make necessary changes.
For instance, since the firm has repeatedly failed to observe ethics in its business activities, the management and leadership teams ought to transform the current business practices and make it mandatory that every transaction, or rather any activity at JPMorgan Chase should be conducted in accordance to the laid down corporate code of ethics. Similarly, every business activity should be carried out according to the law to avoid legal conflicts which are currently slowing down the company's success in the global market.
JPMorgan Chase should recognize the fact that the law was established to guide practices for the benefit of the business entity itself as well as the stakeholders in general. With this in place, stakeholders of the company would strive to operate within the established code of ethics as well as by the existing business law and ensure that the firm carries out its business activities in integrity and restore its moral regulations which are currently lacking. In essence, if all these requirements are met, the organization will be considered successful both financially and ethically.
Failures of JPMorgan Chase & Co.
JPMorgan Chase has engaged in unfair business practices that have earned the bank a negative reputation. It has been alleged and, in some cases, confirmed that the management of this giant institution conspired to engage in unethical banking practices (Escow, 2014). With the management being the culprit in most of the repugnant activities in which JPMorgan Chase engages, it is obvious that the company lacks a strong corporate philosophy that guides its staff morally. This is a colossal mistake given that strong ethical leadership is core to organizational success.
Tasked with the responsibility to inspire and motivate people towards achieving the firm's common goal, leaders play a central and significant part in determining the company's activities on the daily basis. As such, the macro organizational behavior depends on the manner of leadership present in the business entity. Given this, JPMorgan Chase and Co. need to overhaul its leadership team and establish an effective leadership team that will not only focus on business success but integrity and ethical conduct as well.
Since leaders have followers, effective leadership will ensure that all stakeholders of the corporation carry out their daily tasks guided by corporate ethics hence avoid leading the financial company in court battles due to unethical practices. Furthermore, establishing strong and effective leadership will help JPMorgan Chase & Co. to observe moral issues as well as make certain that the business entity remains top in the global market, an activity that is currently lacking in the firm. This is because effective leadership not only guides people in completing their tasks but inspires and motivates them when it comes to the importance of doing the right thing for their own good and that of the organization as well.
Moreover, effective leaders carry out their duties ethically while observing the law hence acting as role models to other company stakeholders. Therefore, to ethically and legally conduct its business, JPMorgan Chase & Co. requires efficient and effective leadership.
As stated in the executive summary, JPMorgan Chase is a company that does not have a good reputation in issues touching on probity among its employees. This scenario points to a big organizational problem. Either JPMorgan Chase as a company condones acts of dishonesty among its personnel or the firm does not have a strong sustainable business strategy. A business entity with a strong sustainable philosophy encourages its employees to stick to a morally agreeable moral code (Hitt et al., 2015).
Such a moral code ensures that the company's operations adhere to regulations as set by the regulator. Above all, a sound moral code guides the business to conduct its affairs in a manner that does not injure or affect the environment either directly or indirectly. The latter, in this case, includes the society within which the business operates.
Therefore, by failing to meet ethical requirements and legal regulations that guide financial and banking activities, it is evident that JPMorgan Chase & Co. is by no means in need of numerous organizational changes. Even though the company has tried to ratify a code of conduct that discourages its employees from engaging in actions that may be deemed negative, so far, the firm has not managed to establish a mechanism that can eliminate improper behaviors from its workforce effectively (Kasperkevic, 2016).
It should be noted that a well-established organization is often immune to court battles because of its properly laid down rules and regulations binding every operation. First, JPMorgan Chase should change the management and leadership teams and replace them with effective leaders and managers who will observe integrity and lead by example. Second, the company should transform its corporate culture and establish its own code of ethics to which stakeholders ought to observe in event of carrying out any business operation.
JPMorgan Chase & Co. should also hold individuals accountable for carrying out activities that contradict it's laid down corporate code of ethics. By doing so, stakeholders will avoid dragging themselves into risky behaviors that tarnish JPMorgan Chase's corporate name. Moreover, developing the principles of ethical decision-making will guide stakeholders, especially the management and leadership, to not only conduct businesses in integrity but also solve conflicts within the company that may otherwise drag it in legal battles. Apart from minimizing risky behaviors, the code of ethics will act as a uniting factor among all stakeholders of JPMorgan Chase & Co. as they will be guided on the way forward in terms of organizational practices.
JPMorgan Chase's history is replete with scandals and contradicts the company's mission, vision as well as a strategic plan. Even though this banking institution presents itself as the investor of choice with outstanding customer service, the numerous scandals paint an image of a firm that is profit-driven and does not respect the established banking regulations (Strong, 2015).
Therefore, taking into account its longstanding problems, JPMorgan Chase& Co. should consider initiating positive transformations to restore its integrity. Significantly, the business entity should shift its focus in that it must take into consideration running current operations while creating tomorrow's reality. To successfully do this, JPMorgan Chase & Co. ought to develop a clear vision, which is based on solid insights of the future with concern to the firm's growth.
With a clear vision in place, the company will be able to make changes that will see it on the safe side of the law while focusing on integrity as the driving wheel of organizational future success. Similarly, JPMorgan Chase & Co. should allocate the necessary resources to ensure that the proposed transformations are successfully implemented. In essence, strategies are only theories until the required resources are allocated. Apart from allocating sufficient resources to enhance positive changes, JPMorgan Chase & Co. should also increase the speed and capacity for alteration to initiate and implement rapid transformations to rescue the already tarnished corporation's name.
Ethics generally involves learning what is right and then doing the right thing based on moral principles. Philosophers often refer to it as a science of conduct. Primarily, ethics helps leaders and managers in dealing with conflicts and handling crises within the company. Therefore, to manage ethical issues at the workplace, there is the need to establish an ethics managing program in any given organization. In light of this, JPMorgan Chase & Co. ought to consider changing its corporate code of ethics to ensure that all firm's processes are carried out within the specified document.
More so, for a banking institution of the corporation, the ethics program should be driven by the top management to make certain that the laid down policies are legal (Strong, 2015). By changing the corporate code of ethics, JPMorgan Chase & Co. will restore its integrity as well as avoid engaging in legal battles arising from unethical conduct. The new executive leadership should ensure that every stakeholder operates within the code of conduct thus maintaining integrity and success.
Furthermore, the executive leadership should ascertain adherence to the code of ethics by initiating mechanisms of control. By controlling business organizations, JPMorgan Chase & Co. will successfully streamline its business dealings to run within the corporate code of conduct.
In essence, the corporate code of ethics is essential in realigning the integrity of the company. For instance, every stakeholder will be required to observe the code of ethics in carrying out any business activity thus making sure that the corporation's processes are ethical as well as legal. Failure to observe the corporate code of ethics results in unethical activities which are mostly illegal which drags the firm into legal battles hence spoiling the corporate name. It is significant to note that failure to observe the code of ethics has been a primary factor contributing to many problems facing JPMorgan Chase & Co.
For such a business entity to restore its integrity and avoid legal battles, it should establish and observe the corporate code of ethics. Similarly, the management, as well as the leadership, have to be changed and the executive leadership should be replaced that will see the corporation successfully develop the corporate code of ethics and corporate culture that aims at guiding stakeholders in business dealings thus avoiding unethical practices. JPMorgan Chase should, therefore, contemplate the need to ethically conduct its business activities to maintain its global success both financially as well as in terms of integrity.
Altogether, the company should bear in mind that engaging in numerous court charges resulting from unethical business practices negatively affects its business name thus driving the financial business backward. Considering this, JPMorgan Chase & Co. should, therefore, establish numerous transformations ranging from developing a corporate code of ethics and corporate culture to changing leadership and managerial teams.