Term Paper: How Microsoft Manages Its Ethical Standards

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[. . .] After all, most people would be highly reluctant to jeopardize their professional careers and reputations by revealing instances of wrongdoing unless there were some monetary benefits for them involved besides moral authority. Moreover, when it comes to the federal government and major contractors, there are enormous sums of taxpayer monies that are involved and paying a fraction of these to help recover the remainder also makes good business sense such as with the False Claims Act.

The False Claims Act is the U.S. government’s main mechanism for recovering funds that have been paid out based on fraudulent claims under various entitlement programs, research and transportation grants, agricultural subsidies as well as defense and national security contracts (Vlahos, 2016). Individuals who report instances of wrongdoing under the False Claims Act can receive between 15% and 30% of the recovered funds. Since 2013, the federal government has recovered billions of dollars in taxpayer funds using the provisions of the False Claims Act (Vlahos, 2016). The federal government recovered fully $3 billion in scarce taxpayer monies in 2011 alone pursuant to the provisions of the False Claims Act (Justice Department recovers $3 billion, 2011).

D. Analyze the impact the U.S. Sentencing Guidelines might have on an organization

Although the U.S. Sentencing Guidelines have only been applied to a small number of organizations to date, the companies that have been targeted are believed to have caused more criminal harm to society than all individual criminals combined (Murphy, 2002). The high-profile cases involving the sentencing guidelines have caused increasing numbers of corporate leaders to recognize the potential outcomes, including personal liability, for failing to comply with relevant ethical standards and other legal requirements (Murphy, 2002). To help guide the process, three of the most important culpability factors for driving ethical behavior in organizations include corporate culture, human resources practices and competitive integrity (Gartenstein, 2016).


With operations that literally span the globe and more than 100,000 employees working in more than 100 different countries, developing, implementing and administering effective and timely ethical policies at Microsoft Corporation represents an ongoing and complex enterprise. Despite the challenges that are involved, though, the research showed that this company has established organization-wide ethical standards and standards of business conduct as well as corporate policies concerning reporting mechanisms for suspected breaches of ethical conduct. Although the research also showed that publicly traded companies such as Microsoft are legally required to maintain such codes of ethics or provide justification for their failure to do so, it is reasonable to conclude that Microsoft would still maintain these codes and standards even if they were not mandated given the company’s emphasis on ethical conduct by all employees.


Among the world’s most ethical companies. (2013, March 14). Microsoft on the Issues. Retrieved from https://blogs.microsoft.com/on-the-issues/2013/03/14/among-the-worlds-most-ethical-companies/.

Compliance. (2017). Microsoft Corporation. Retrieved from https://www.microsoft.com/en-us/trustcenter/compliance/default.aspx.

Corporate ethics and Sarbannes-Oxley. (2016). Wall Street Lawyer. Retrieved from http://corporate.findlaw.com/law-library/corporate-ethics-and-sarbanes-oxley.html.

FY17 reporting resources. (2017). Microsoft Corporation. Retrieved from https://www.microsoft.com/en-us/about/corporate-responsibility/privacy

Gartenstein, D. (2016). What is the most important influence on ethical behavior in the workplace? Chron. Retrieved from http://smallbusiness.chron.com/important-influence-ethical-behavior-workplace-41952.html.

Gaumnitz, B. R. & Lere, J. C. (2009, May). Codes of ethics with impact. The CPA Journal, 74(5), 64-69.

Governance at Microsoft. (2017). Microsoft Corporation. Retrieved from https://www.microsoft.com/en-us/about/corporate-responsibility/governance.

Justice Department recovers $3 billion. (2011, December 19). U.S. Department of Justice. Retrieved from https://www.justice.gov/opa/pr/justice-department-recovers-3-billion-false-claims-act-cases-fiscal-year-2011.

Microsoft code of ethics. (2017). Microsoft Corporation. Retrieved from https://www.microsoft. com/en-us/legal/compliance.

Murphy, D. E. (2002). The Federal Sentencing Guidelines for organizations: A decade of promoting compliance and ethics. Iowa Law Review, 87, 697-719.

Nadella, S. (2017). Letter to shareholders. Microsoft Corporation. Retrieved from https://www. microsoft.com/investor/reports/ar17/index.html.

Raising integrity concerns. (2017). Microsoft Corporation. Retrieved from https://www. microsoft.com/en-us/legal/compliance/sbc/reportaconcern.

Vlahos, C. (2016, October 1). When the ends do not justify the means: The application of statistical sampling to determine liability in False Claims Act cases. St. John\'s Law Review, 90(3), 813-821. [END OF PREVIEW]

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