Would the Model Mean that Fannie Mae Could be Labeled an "honest" company?

No, the model would mean that Fannie Mae could not be labeled as an “honest” company because of the deceitful actions the company has taken throughout the years.

According to Islam, Seitz, Millar, Fisher and Gilsinan (2013), “Fannie Mae and Freddie Mac were created by the federal government of the USA for the purpose of increasing home ownership by increasing the supply of mortgage loans” (pp. 150). These two companies “were created to provide a second market for mortgage loans so that original lenders could free up their money for new loans” (Islam, Seitz, Millar, Fisher & Gilsinan, 2013, pp. 150).

Fannie Mae was created by the Roosevelt administration in 1938 and was a government agency that was run by the federal government. “The goal of the government in creating Fannie Mae was to make more funds available for lower income and less credit worthy families” (Islam, Seitz, Millar, Fisher & Gilsinan, 2013, pp. 151). When looking at the government’s goals when Fannie Mae was created, shows that the organization was “successful for a number of years in this regard” (Islam, Seitz, Millar, Fisher & Gilsinan, 2013, pp. 151).

Freddie Mac was then created when the government created the Federal Home Loan Mortgage Corporation. Which basically provided the “same services as Fannie Mae, thereby providing competition in the marketplace for the purchase of home mortgages” (Islam, Seitz, Millar, Fisher & Gilsinan, 2013, pp. 151). In 1989, Freddie Mac and Fannie Mae became “a private company with publicly traded stock” (Islam, Seitz, Millar, Fisher & Gilsinan, 2013, pp. 151). This allowed the two companies to become private companies.

Looking at the model of corporate social responsibility, Fannie Mae could not be labeled as an “honest” company. When looking at Fannie Mae superficially, one would believe Fannie Mae is a good company that practices being socially responsible. However, when taking a deeper look, one realizes that throughout Fannie Mae’s history that company has done nothing but show that the company is only interested in profit and out for the company’s own needs.

By using Jennings’ eight questions model Fannie Mae’s true character of its soul is revealed. After using Jennings’ eight questions model, one realizes Fannie Mae simply does not have the characteristics to be an honest company.

References:

Islam, Muhammad, Seitz, N., Millar, J., Fisher, J., & Gilsinan, J. (2013). Fannie Mae and Freddie Mac: A case study in the politics of financial reform. Journal of Financial Crime. 20(2), pp. 148-162.

Jennings, M. (2012). Business ethics: Case studies and selected readings. 7th ed. Mason, OH South-Western Cengage Learning.