Ethics and Corporate governance Essay Example | Topics and Well Written Essays - 2500 words

Ethics and Corporate governance - Essay Example   Ã‚   Matthew Lee, the Lehman’s Holding Incorporated Senior Vice President, was discontent with the accounting practices of the company, and wrote a letter (later made public) to the company; expressing concerns about the senior managers were violating the internal code of ethics, by misleading investors and regulators about the true value of the company assets, according to Corkery (2008).   Ã‚   In another incident, David Einkorn of the hedge fund Green light Capital Inc., reported that Lehman Brothers’ action of writing up the value of KSK Energy Ventura (a power plant in India) from $400m to $600m during the 1st Quarter of 2008, was an unethical accounting practice, according to Corkery (2008). Lehman reacted by saying it was in anticipation of profits to be made.   Ã‚   The Sarbanes –Oxley Act, with all its preventative provisions were introduced from 2001, according to the Economist (2010), but despite this, Lehman was removing assets from its balance sheets, convincing accounting firms (including Ernest &Young) to approve unethical maneuvers, and holding assts like KSK Energy Ventures at inflated values against market prices according to the Economist (2010).   Ã‚   Lehman   leaders showed blatant disregard for interest of the public, dishonesty ,as well as   very high levels of egoism on September 10, 2008, when Ian Lowitz, the bank’s Chief Financial Officer, told investors that the liquidity of the company remained strong at $42b. However, according to the Economist (2010), a day earlier an internal document had revealed that Lehman had low ability to monetize almost 46% of its assets.   Ã‚   The level of abuse of their fiduciary responsibility was extremely high, as according to Valukas, its liquidity pool was designed to allow it to survive at least 12 months of stressed financial situations, but it only had cash and