Should the law prohibit employees acting as Griffiths and Steffes did? Explain why or why not?
Putting legal technicalities aside, did Griffiths and Steffes act unethically? Explain the facts and
moral principles that support your answer
Business Case Study
Employees Acting Should Be Prohibited like it was done in Griffiths and Steffes
I concur that employees acting should be prohibited under the law as was the case in
Griffiths and Steffes firm. Insider trading is not a legal practice and so should be outlawed. In
their case, the law discouraged insider trading and handed over significant penalties to Griffiths
and Steffes under Section 10 (b) of the 1934 Security Exchange Act. The case of Griffiths and
Steffes is an ideal situation that represents family insider trading. Using insider information that
is aimed at profit-making is not only unfair but also unethical in business practice. The public
should be made aware of all relevant information about the products that they are purchasing
(Walcott, 2014). The absence of this precipitates unfair business practice and inequality giving
such firms an unfair competitive advantage over their business rivals.
Griffiths and Steffles Acted Unethically
Permitting such actions would set a bad unethical business precedent in the stock market.
First, it may create a sense of unfairness that could create business strife that negatively impacts
the business environment. Secondly, it may make other firms start the practice as well to gain a
competitive advantage at the cost of business ethics (Walcott, 2014). Lastly, it would create an
impression that insider trading is a legal process. If such actions are tolerated, the faith of citizens
in stock market fairness is likely to be diminished. This is because there will be a feeling that
some stakeholders have undue advantage giving them a competitive advantage over their
business rivals which is an unethical business practice. Individuals and firms that practice insider
BUSINESS 2
training should be charged, fined, or prosecuted to reinforce stakeholder confidence in the stock
market.
References
Wolcott, G. (2014). Business Ethics and Ideals. Business Ethics Journal
