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Business LibreTexts

13.5: Corporate Culture and Business Practices

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    Corporate Culture and Business Practices

    • Lack of meaningful long-term corporate planning and focus
    • Creation of a “culture of greed” and management self-enrichment: materially more generous compensation pattern for the CEO and senior executives than peers
    • “Make the numbers!” corporate culture: untoward pressure on managers to achieve aggressive budgets
    • Creation of a “culture of fear,” penalizing internal debate and independent or creative thinking; creation of environment where only “good news” is acceptable to corporate chieftains
    • “Take no prisoners!” corporate culture: questionable or heavy-handed strategies and tactics with competitors, customers, employees, suppliers, accountants, bankers, business partners, and regulators or government authorities
    • History of litigation in pursuit of business strategies and undue pressure on critics (e.g., lawsuits by company against company customers, employees, suppliers, accountants, bankers, regulators or government entities)
    • Lack of transparency: history of lack of openness with external and internal constituencies, including independent directors
    • Heavy use of lobbyists and lawyers
    • Aggressive corporate communication and image building; heavy use of “spin”
    • History of aggressive or questionable sales and/or marketing practices
    • Cavalier attitudes toward internal control