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BUSI 520 - Faith
Integration
International Business (Liberty
University)
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During our study of the Fundamentals in Corporate Finance the primary goal as noted in the text
is maximizing value. Financial managers are tasked with decisions regarding what investments
the corporation should invest in and how should it pay for them in order to achieve that goal.
When considering this goal, it is difficult to imagine how religion would correlate to a
corporation’s operations. Financial managers operate in an extremely competitive business
market and not all make ethical and honest decisions. This seems to be a problem within the
financial sector today which has been impacted by corporate governance and government
regulation. Many professionals feel the pressure to sacrifice their integrity in order to be
successful. There were several ethical disputes noted in the text, such as short selling, corporate
raiders, and tax avoidance. In addition to that there have been other scandals such as Enron, and
the Bernie Madoff Ponzi scheme. While these types of actions illustrate the suffering of specific
stakeholder groups, it is important to note the financial crisis of 2007-2009 which brought the
world into a global recession. These types of behaviors demonstrate the importance of the
financial markets along with the importance of them to operate properly and ethically. It is
important to recognize that many of the practices used in business are very similar to Christian
principles. While there are numerous examples today of corrupt and fraudulent practices that can
be observed as Christian business leaders we must endeavor to follow and share the good news.
Personal and business relationships are built on elements of respect, and trust. From a finance
perspective they can be further broken down into elements of trust, credibility, transparency, and
accountability. While all these elements are of equal importance, I am reminded of a verse in
Corinthians that illustrates the importance of transparency and accountability. “But we have
renounced disgraceful, underhanded ways.” 2 Corinthians 4:2(ESV) This verse shows the
importance of transparency and the fact that we have much more to lose than gain by not
practicing it. There is little to be gained and much to be lost in the way of reputation if an
organization portrays itself in a false light.
There were several articles that supported ethical behavior as it relates to reporting. The impacts
of fraudulent reporting go far beyond losses for investors, it has a ripple effect on the economy
and society. Creating a culture of integrity is imperative to build shareholder trust as well as
public confidence in the free market system. The failings of a few can undermine ethical
standards and impact the behavior of others. Corporate leaders must establish a code of ethical
behavior within the organization and continue to develop and sustain it. Transparency and
validation are the two main methods of achieving trust and confidence. Transparency as it relates
to the information contained within the reports and validity as a representation of how well the
information reflects reality. Managers may be required to hit an earnings target for the
corporation and as a result be tempted to make a decision that will benefit their own career. An
article explored the intent of managers as it related to decision making and earnings reporting
and it was noted that within an organization intent is influenced by the culture of the
organization and the reward system. Personal spiritual characteristics were also identified as
having an impact on managers decisions about earnings management.
The Christian faith provides believers with the stability necessary to navigate the challenges in
the financial world. As a Christian, ethical values are imbedded within our faith; to take care of
those in need, to give charitably and understand that we are responsible for our actions. Everyone
is called to be accountable in some way, and it encourages us to work hard and persevere.
Decisions of a personal as well as a business nature matter to those around us and to God. They
are a reflection of our beliefs and attitudes. It is just as important that our actions demonstrate
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these values to others. These types of values encourage ethical and responsible behaviors in the
business environment as well. “But I tell you that men will give an account on the day of
judgment for every empty word they have spoken.” – Matthew 12:36(NIV)
References
Kalbers, L. P. (2009). Fraudulent financial reporting, corporate governance and
ethics: 1987-2007. Review of Accounting & Finance, 8(2), 187-209.
doi:http://dx.doi.org.ezproxy.liberty.edu/10.1108/14757700910959510
https://search-proquest-com.ezproxy.liberty.edu/docview/215635372?pq-origsite=summon
