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Running Head: Wells Fargo Case Study 1 Introduction: As the subject of this case study, it will be discussed how Wells Fargo, once one of the world's most popular financial institutions with the highest equity and stock price, was fined $185 million dollars as a result of unethical practices followed by employees in order to open more than 2 million unauthorized customer accounts and bring business to the company (Vincent, 2018). General Discussion Questions Answer 1: It is possible for business leaders to adapt a variety of lessons learnt from this incident to their respective firms. One of the first and most significant points to mention is that they should not have placed pressure on employees to fulfill sales targets, which resulted in employees taking the unethical route to achieve the goal. Business leaders must have established confidence in all of their employees so that if anyone spotted them engaged in fraudulent behavior, they would have brought it to their attention and prevented the behavior from progressing further. Averting the need to pay fines and terminate hundreds of employees would have prevented this from happening to the corporation. Also important is for business leaders to avoid becoming overly ambitious in their efforts to expand the company. Because the supervisors' employees were involved in unethical behavior, the decision was made to terminate them. It is imperative that when it comes to attaining a goal, leaders attempt to create a climate in which ethical behavior, honesty, and hard work take precedence over unethical behavior, dishonesty, and the use of unethical means to achieve the goal (Ghoshal, 2021). Answer 2: The cultural collapse, according to many regulators, occurred as a result of insufficient control and tougher restrictions on employees' activities. However, I do not think this

Running Head: Wells Fargo Case Study 2 to be the case, and I have my doubts about whether lax controls were the primary cause of the incident. In this period, it appears that values-based leadership was lacking at the very top of this Wall Street monster's organizational chart. The purpose of setting goals is to achieve them or to win them, not simply to establish them. Customers, as well as all other members of the organization, including corporate employees, employees of the banking industry, and other stakeholders, are the losers in this situation. It is the responsibility of business executives to ensure that all of their employees are aware of the consequences of their actions. During the orientation meetings, it is critical that unethical behavior be explained in depth. Otherwise, the training will be ineffective (Vincent, 2018). Practice of Ethical Leadership Questions Answer 1: As explained by Stumpf, the reason for this is due to a tiny number of employees who have chosen to conduct business in an unethical manner in order to increase sales, which is absolutely against the company's values, and the company does not condone this type of behavior from anyone. The primary objective of the corporation was to expand its customer base by persuading them to purchase additional products from the company's line of products, which was its primary goal. As an added bonus, this would have assisted the firm in its efforts to create relationships with its customers. Due to such employee behavior, clients may have begun to lose trust and interest in the company, and they may have come to believe that they had been misled as a result of their encounter. As a result, it is vital for firms to offer their staff with ethics training in order to keep them from engaging in unethical activity (Ghoshal, 2021). Answer 2: The primary focus of the organization's executives should be on being actively involved in the implementation of ethical programs within the organization and ensuring that all

Running Head: Wells Fargo Case Study 3 employees are encouraged to participate. When it comes to the profitability and long-term survival of a company, the brand and reputation of the organization are vitally important. It will be difficult for a corporation to restore its reputation after a scandal has occurred, and customers will lose confidence in the organization. Therefore, it is vital for the long-term survival of the company as well as for the welfare of its employees and consumers that the organization adhere to ethical standards at all times. Employees that are dedicated to their jobs are always willing to put in the effort and have confidence in their capacity to behave themselves in an ethical manner. The efforts of employees who are dedicated to their jobs should be recognized and rewarded; this will encourage employees who are involved in unethical actions to change their ways (Vincent, 2018). Answer 3: the Company’s leadership turned a deaf ear to the many employees who had already reported the unethical activities through the hotline, and instead of rewarding the individuals who had reported the unethical behavior, they fired them for their actions as a result of their reporting. Clearly, management was supportive of unethical activity in this case because they did not take any action against the individual who was engaged in the unlawful behavior, but instead fired the employees who raised their voices and showed their dissatisfaction. The creation and promotion of an organization's code of ethics can aid in the reduction of ethical ambiguity in the workplace. The code of conduct should explain the fundamental principles of the organization as well as the standards to which all employees must adhere. It is possible, however, that the code of ethics will be rendered useless if senior management fails to exert influence over ethical behavior. In order to motivate employees, performance appraisals, in which managers include point-by-point assessments of how their decisions correspond with the organization's code of ethics, will be the primary method of recognizing and rewarding them (Ghoshal, 2021).

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Running Head: Wells Fargo Case Study 4 References VINCENT N. (2018). Exactly when Good Policies Go Bad: Controlling Risks Posed by Flawed Incentive-Based Compensation. Cleveland State Law Review. 66(4):775-799. https://search.ebscohost.com/login.aspx? direct=true&AuthType=sso&db=a9h&AN=139047742Ghoshal, A., Mookerjee, V. S., and Sarkar, S. (2021). Ideas and Cross-selling: Pricing Strategies while Personalizing Firms Cross- sell. Journal of Management Information Systems, 38(2), 430-456. https://doi.org/10.1080/07421222.2021.1912930

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