Ethics Core-Tex Is Facing a Number of

Ethics Core-Tex is facing a number of problems that could result in negative publicity. At present, the company is facing multiple challenges but has escaped major headlines. Thus, its stock price has not been hit too hard as the result of the accounting accusations. For the CEO, there are a few key things that need to be done. The first move, the muzzling of the C-suite, is essential. From a public relations perspective, the company needs to speak with a unified voice.

From a legal perspective, there may be limits to how much the company can say anyway. The first step, then, is information gathering. The CEO in particular is liable under the Sarbanes-Oxley Act for anything accounting misstatements (Sarbanes-Oxley, 2014). The CEO must take personal responsibility for verifying the accounting allegations. This is necessary because there seems little doubt that the SEC will send investigators over the company, given the nature of the allegations.

If the allegations are true the CEO will need to work with the SEC to deal with them; if they are not then the company needs to ensure that the SEC clears the company and that no major negative publicity occurs. By the time word emerges that the SEC is going to investigate -- this will probably come in an SEC press release -- the damage to the company's stock will occur. The CEO therefore needs to know if the SEC is going to find anything or not.

The second step is with respect to the environmental issues. Here, the company is aware of the information and the step now is to address the problem and engage in a public relations campaign. The marketing manager is correct -- the company needs to get in front of the rumors and dictate the course of the communication, because those rumors will completely gut the stock price. Moreover, a quick response will show stakeholders that the company is well-organized and is working quickly to bring the issue to a resolution (Bernstein, 2013).

The CEO should already have a crisis management team and plan in place; if not, this needs to be prioritized. The public relations staff should prepare statements, dry and uninteresting, but clear in their mission to communicate that the company is dealing with its environmental obligations. It is important to note especially that the company is complying with the EPA citations and will be changing its policies to reflect EPA guidelines more closely in the future.

Then, once a response has been formulated, the C-suite needs to be brought on board. Right now, there is no consensus because people seem to be defending their turfs. That is not good enough -- consensus needs to be built. Also, because this is a crisis, all C-suiters must be in attendance. We have mobile technology in 2013 -- even if the VP of Manufacturing in on top of Mt. Everest, he needs to be logged into that meeting.

The environmental mess is his and he needs to be accountable for that. There also needs to be internal communication. The EPA stuff is probably old news, but the accounting issues are not. These also, if they are true, threaten the existence of the company. There are enough horror stories about people whose companies faced accounting scandals and they lost everything as a result -- the employees will hear the rumors and be panicked. While the public.