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Mendoza sponsors annual Ethics Week

Matt Bramanti | Monday, February 16, 2004

In the wake of corporate scandals involving formerly respected firms like Enron, Tyco and Martha Stewart Omnimedia, the Mendoza College of Business is calling “time out.”The theme of this year’s ethics week, which begins today, is “Time Out for Ethics,” said accounting professor Ken Milani, who is organizing the week’s activities. From today through Thursday, the College will host speakers to discuss various points of ethical behavior in modern business, both in the U.S. and beyond.Today at 12:30, the college will host a panel discussion entitled “Enron: A Multi-Dimensional Examination of an Unethical Enterprise.” Bill Schwartz, dean of the business school at Indiana University-South Bend, will moderate a panel of speakers including Matt Barrett, from the Notre Dame Law School, as well as Tom Frecka and Jim Seida, both from the Mendoza College of Business.Milani said the downfall of Enron, the Houston-based former giant in energy trading, was a wake-up call for the entire business field.”Enron proved that if you don’t have an ethical underpinning, you’ll find yourself on the outside looking in,” Milani said. “It was a Fortune 20 company and basically disappeared overnight.”Tuesday’s event will be a presentation on “Ethical Dimensions of Corporate Governance” by Larry Rieger, a partner at Crowe Chizek and Company. Crowe Chizek, based in South Bend, is the eighth-largest accounting firm in the U.S. On Wednesday, John Gschwind will discuss “Ethical Implications of Operating a Multi-National Corporation. Gschwind is general counsel of General Electric Supply, and is no stranger to international business, as GE Supply’s parent company General Electric is a $134 billion company with operations in over 100 countries worldwide.The week will wrap up with Thursday’s presentation by Steve Watts, president and CEO of Sobieski Bank, a South Bend-based financial institution. The bank was hit by a scandal in 2002, when it was revealed that Thomas Gruber, a loan officer at the bank, distributed nearly $10 million in unauthorized loans to his cronies. In August 2002, Gruber pleaded guilty to federal bank fraud charges in connection with the scheme.While the college is focusing on ethics this week, Milani said the work goes on year-round. “This [week] is one more thing that says ethics is important to the college of business at Notre Dame,” he said. “It’s one more brick in the wall.”Father Oliver Williams, who runs the MCOB’s Center for Ethics and Religious Values in Business, agreed by saying ethics permeates the university and its business school.”Father Sorin’s vision was to train not only the head, but the heart,” Williams said. “We want to teach not only competence, but compassion, generosity and integrity.”He noted that undergraduate business students are required to take two courses in ethics: one about general ethical concepts, and one covering ethical implications within their respective fields of study. In addition, MBA students have a similar requirement. Williams said the problem of business ethics is one that should be addressed at all levels of society. “You have to look at ethics not only on the individual level, but the organizational level and the systemic level,” he said. “You cannot underestimate the problem.””[Without accountability,] a small number of people can do a lot of harm to a lot of people,” Williams continued. “You have to have accountability structures, so that if you do get a bad apple once in a while, the system will catch up with him.” He said Ethics Week is vital to raising the idea of trust in contemporary business.”Trust is essential for capitalism to work,” Williams said. “People don’t presuppose as much trust anymore, and that’s the major problem of our time.”