Business ethics and accounting information in light of the Financial Crisis of 2008

Abstract

This dissertation examines, from an ethical perspective, the vulnerability of the U.S. financial system that was exposed in the financial crisis that began in 2008. Three essays are presented, each of which examines an aspect of the relationship between business ethics and risks to the financial system. Essay 1 presents an ethical analysis of executive incentive compensation plans that rewarded excessive risk taking by basing cash-based incentive compensation upon accrual-based net earnings. Essay 2 offers a historical account and ethical analysis of how the post-Depression U.S. financial system allowed, or even encouraged, individual financial institutions to become too-big-to-fail and too-interconnected-to-fail. Essay 3 a broader theoretical paper, develops a framework for applying ethical analysis to the accounting measures and disclosures communicated by a firm. While each essay is a distinct analysis, the dissertation is also an integrated work that illuminates the complex general relationship between business ethics and the capital markets, as well as the specific role of accounting information in ethics and the long-term viability of the financial system.

Ph.D.

Includes bibliographical references

Includes vita

by Ronald J. Strauss