Ethical Issues in an Organization- Bribery

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Ethical Issues – Bribery

In this paper on ethical issues, I will be presenting my perspective on the issue of Bribery in doing business. I will be summarizing three distinct articles from different sources, namely, Harvard Business Review, Bloomberg Businessweek and The Wall Street Journal, respectively. Later in this paper, I will provide some insight on how this aspect of corruption could potentially affect my business project for this course. The three articles that I have used in this paper are varied in their content. I have tried to use each article to portray an example of a potential bribe, the thin lines of definition for bribery, and how there are laws existing in this country to prevent the occurrence of bribery in doing business.

The Harvard Business Review, for a brief time handled a forum in its blog titled ‘Good Decisions’ and in which I came across an article where an IT consultant wants to know if the sales commission that he was offered from a vendor he selected for a client is legitimate. This example is important because the vendor has already benefited from an impartial selection process that consultant did for his client. The controller of this forum, Clinton Krover lists out three reasons why it may not be right for the consultant to accept the ‘Commission’. As he points out, legally, the consultant represents his employer and so any ‘commission’ actually belongs to his employer and not him personally. It is another thing that the ‘commission’ itself may “violate bribery and kickback laws” notwithstanding the fact that the consultant may also violate his contractual obligations to his employers by a potential acceptance of the ‘commission’. The more obvious judgment with relation to this paper is with regards to ethics. An acceptance of the ‘commission’ would mean that the consultant would keep this vendor in his good books for future selection processes for his clients. Mr. Clinton provides an easy self questioning test to satisfy ethical guidelines with questions on how you may feel if “your employer and client found out about your "commission"?” and if one is “willing to ask your employer and client upfront if they object to you taking it?” The author also points out the prudential reasons wherein the concerned person is at risk of a conflict of interest for indulging in such an act. Overall, it shows that bribery, in its forms of kickbacks or commissions can jeopardize an individual or a firm’s reputation and damage its business.

In my next article in study from Bloomberg Businessweek, the author stresses on the need for a global standard on ethical practices and denounces the use of “Situation Ethics” in dealing with businesses abroad where standards of ethics in business are different than in the US. The author mentions the Foreign Corrupt Practices Act (FCPA) which makes it unlawful for American firms to indulge in bribery or kickbacks or any form of payment to secure or retain a business abroad. While American multinationals complain of losing competition to companies from other countries, maintenance of such ethical standards is required across all fronts in all parts of the world. The author lists out a few repercussions due to failure of maintaining such standards globally. As stated above, the reputation of a company is at stake each time an employee of the company or its subsidiary involves in corruption to win contracts abroad. The examples of Siemens and BAE systems is shocking and yet, as the author says, something company executives do not shy from to win large contracts. The author also stresses on the need for the CEO to fully spread through his chain of command, the importance of engaging in corruption free practices everywhere in the world. I see the need because an employee in a remote subsidiary abroad may not be aware of the strictness of the guidelines by which his company operates and a mistake by him costs the entire company a lot in reputation and in fines imposed by...
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