An ethical crisis occurs when an event that was not part of the normal course of action for a firm takes place and affects the firm.

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An ethical crisis refers to a situation where a firm faces unexpected events that have the potential to negatively impact its reputation, trustworthiness, and profitability. These events are usually the outcome of unethical or illegal practices by the organization or its employees. Ethical crises arise when companies fail to adhere to the moral and social norms, as well as legal requirements governing their operations, leading to public outrage, legal action, and financial losses.

An Ethical Crisis Occurs When an Event That Was Not