Moral aspects of subprime lending back in the news; diamond company sues to stop rival from claiming title to world?s brightest diamonds; USA Today reports that civilian CEOs are attending ethical leadership courses taught by military
NEW YORK and WASHINGTON
Business ethics were the focus of several stories last week. Among the coverage:
- In the latest development about the ?moral hazard? of subprime lending, the Wall Street Journal reports that an increasing number of student loans are held by borrowers with shaky credit records and that an increasing number of those loans are going into default. The Journal reports that repaying debt has grown more difficult because interest rates on those loans increased because of a change in federal loan policy. The issue is assuming ethical prominence because some contend that students have been lent money too easily.
- The Reuters news agency reports that a federal judge has denied a request by the parent firm of Kay Jewelers to stop rival Zale Corp. from claiming in its ads that it sells the ?world?s most brilliant? diamonds. The suit claimed that Zale could not make the claim because it hadn?t tested all of the cuts of diamonds in the world, reports Reuters. The judge declined to issue an injunction stopping the ads, saying that the potential for immediate irreparable damage was not that great. The case can still be brought in the future for possible monetary damage.
- The U.S. Marine Corps is offering a workshop to executives that involves having combat leaders train businesspeople in ethical leadership, reports USA Today. Basic to the premise of the growing trend of leadership being taught by military personnel are recent studies that show senior executives with military training are less likely to commit transgressions such as fraud. While some of those findings may be attributable to self-selection by those who choose to join the military, says the report, research notes that the training offered by armed services emphasizes ethics and responsibility.
Sources: Wall Street Journal, Feb. 1 ? Thomson Reuters, Jan. 24 ? USA Today, Jan. 29.
For more information, see: Related Newsline story, Jan. 28 ? Related Newsline story, Jan. 22 ? Related Newsline story, Jan. 22 ? Related Newsline story, Jan. 14 ? Related Newsline story, Jan. 14.
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