Question

Send Me Money, a charitable organization, has a agreement with First California State Bank. The agreement allows Send Me Money to overdraw its cash balance at the bank when donations are running low. In the past, Send Me Money managed funds wisely and rarely used this privilege. Bill Greedy has recently become the president of Send Me Money. To expand operations, Greedy acquired office equipment and spent large amounts on fundraising. During Greedy's presidency, Send Me Money has maintained a negative bank balance of approximately $10,000. Question one: What is the ethical issue in this situation, if any? Question two: State why you approve or disapprove of Greedy's management of Send Me Money's fund.

Answer 1

Answer:

The use of the term "ethical" sometimes is a bit too lax when applied to evaluate situations. However, sometimes, it can also be too harsh. In response to your two questions, these would be the answers:

1. The ethical question here would be whether Greedy was right in overusing a benefit that the charitable organization had with the First California Bank. As President of the organization, it is in the hands of Greedy to ensure not just development, but also sustainable development of the organization. However, in the course of his attempts to improve the growth and efficacy of Send Me Money, he abused the benefit of the overdraft, and not to just any extent, but to the negative balance of 10.000 dollars. Although his intentions were in favor of the organization, and he used the money wisely, there still lies the question of if he could not have accomplished just as much, without abusing a benefit that could very well mean the end of the organization. So the ethical issue is that although the intention of Greedy was in the benefit of the organization, he did not take the best interest of it into account, because if he had, he would have tried to accomplish his goals without bringing the debt so high.

2. I disapprove of the way that Bill Greedy acted because he could have accomplished much more realistic goals and not placed the organization at risk by raising the debt to a bank to such high levels. Even if he increased fundraising efforts, it is evident that these were not successful, as the debt is so high.