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Identify each of the stakeholders and how they are affected. What are the main harms and benefits in this case for the different stakeholders based on the current situation?
A stakeholder is an individual, a company or even the government. This means that a stakeholder is that body that affected by the daily proceedings of a business. The stakeholders divide into two groups either the internal or the external stakeholders depending on how the business organization affects their existence (Bygrave, William D, and Zacharakis, 98). The internal stakeholders include the individuals or bodies that interact directly with the business that include customers, suppliers, employees, creditors and suppliers. The external stakeholders do not have direct link with the organization, however they affect the business or vice versa and they include the public, the media and the government.
In this case, the internal stakeholders in the banking industry contributed to the occurrence of the previous bad situation in the banking industry. The managers started competing themselves forgetting about the pressure they are mounting in their industry leading to drop of the percentages on the mortgages and increment of the interest percentage across different banks. Crane,A &Matten, (126) explain that the government in this situation plays the bigger part since it requires to protect the country’s economy therefore it needs to come up with better measure to protect inflation therefore preventing the public and controlling the bank industry. The UK government came up with better measures such as the buying of share in the almost companies in order to manage and control the flow of the services. The government also cut the issuing of loans and this would influence the other stakeholders such as the customers since they depend on the loans in order to fund other small businesses. The public and the customers suffer more since they have to deal with the high house prices and high percentages on mortgages (Ferrell, O C, Fraedrich, & Ferrell, 181).
From a utilitarian perspective, would you argue for or against the proposed tightening of UK banking regulation?
The tightening of the bank regulations would both have positive and negative impacts but in this case, I would support the UK government to tighten the banking regulations. The banks failed to control the entire economy instead the banks became mean and started caring about their own goals. Friedman, Andrew L, & Miles, (76) contemplate that the increase in the percentages led to increased interests since the banking industry had become competitive and was heading out of control. The banking industry became mean and started making money to earn profits without caring about the economy. This was because the banking industry had its own regulations and the shareholders within the companies did not have the powers to control the flow of their capital.
This led to the drop in the interest percentage of the loans and mortgages and therefore the banking industry leased a huge sum of money in form of loans to the people more than even the capital deposited in the bank. This was a great threat to the bank and could probably lead to the collapse of the industry. Roeder, (209) states that a bank could increase the percentage interests at any single time it would like; however, the banking industry could increase the percentage more if the customer invests in another bank. This made the business non-lucrative and therefore the government had to step in and started purchasing the shares. This would prevent the other shareholders from losing trust with the banking system. The banking industry was the backbone of the UK government economy therefore this means that the collapse of the banks would lead to the drop in the economy. This made the government step in and save the country. This is the major reason why I support the tightening of the banking regulations. The banks need to work with certain rules knowing that a simple mistake would adversely affect the country.
Using arguments based on the ‘maxims’ of duty, would you consider the UK banks to have acted ethically in their operations?
No. the banks did not act ethical in their operations. This is because the banks did not consider the effects of increasing the percentage interests and loans and the buildup of the competition. The banks need to consider the economy before they take a step in the increasing of the interest percentages (Sharon, 45). The banks need to control the management of the country since the increase of the interests would definitely interfere with the economy either positively or negatively. In this case, the UK government depends on the banks for the strengthening of the economy since it is the first source of revenue and therefore it could influence the country’s economy. The banking industry was the key service and top revenue earner for the government. Tschirhart, (56) explains that the increments made in the banks in order to curb competition within the various companies were a bad move since it could lead to inflation. This UK government had to borrow money from the various states in order to pump the money back into the banks. This led to increase in the debts that the government would pay since the interests were much higher. This means that of the banks were responsible the government would not step in the industry in order to fund and try to change the regulations in order to prevent .............
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