Corporate Governance and Business Ethics in Merck Essay

Corporate Governance and Business Ethics in Merck - Essay Example The researcher states that Merck reached about 269 million individuals through its numerous corporate social responsibility partnerships and programs. The current study will focus on corporate responsibility activities and corporate governance codes followed by Merck. The study will also analyze environmental conditions across the USA, which are supporting or hindering corporate governance activities of Merck in the USA. In the literature review conducted by Hawley and Williams, the US corporate governance was reviewed. Four governance models were identified, which were finance model, stakeholder model, stewardship model and political model. In the financial model, the major focus is given on construction of incentives and rules for effective alignment of managerial behaviors with principal owner’s desire. On the other hand, political model, stakeholder theory, and stewardship theory are majorly ethnocentric. The society of United States has been encouraging businesses, which are socially responsible and been promoting only those profit-making firms that have proved their intention of improving and not harming the society. However, this struggle for companies to meet society’s expectations is constantly challenged due to changing nature of society, in terms of their demands patterns. As a result, the US government has set out some legal and environmental regulations, which are compulsory for all businesses in the US. The business affairs department of US government deals with all CSR activities and policies governing businesses in the US. The objective is to promote ethical and responsible business practices and ensure effective partnership and coordination among companies, business, US embassies, civil society firms as well as numerous stakeholders. Major regulatory laws controlling businesses in the USA are human rights and ethical and acceptable corporate citizenship. The US government has laid down some strict policies so that corporate undert ake only those activities, which are deemed as socially responsible, ethical and promote sustainable development.