1. Ethical principles and the decision-making process
Nowadays it is believed that ethical principles are the foundation of ethical analysis. Each theory can be used for predicting the outcome and following one’s duties to others in order to reach an ethically correct decision. The problems that are discussed in any cases like the AWB LTD scenario can bring significant changes to the decision –making process for others. Also the best approach is to use ethical theories such as Utilitarism, Deontology, Libertarianism etc., in combination in order to obtain the most ethically correct answer and solution possible for each case.
2. Case study of the AWB LTD wheat board scandal
The Australian Wheat Board case is a clear example of corporate culture and other systemic failures influencing and defining an organisation’s decision making and its ethical posture. This report addresses the underlying organisational causes of the AWB scandal, whereby AWB paid kickbacks to Iraq in defiance of the rules of the Oil-for-Food programme, instituted by the United Nations. In so doing, it consider the evidence and conclusions presented in the Cole inquiry, a Royal Commission established to investigate the conduct of several Australian companies in relation to the program. At the height of the investigation, the single-desk arrangement from which AWB benefits came under criticism. In 2006, the Australian Grain Exporters Association asked the Government to remove AWB's monopoly export powers. The Oil-for-Food scandal cast doubt among some grain exporters over the trust placed in the company, especially as they lost the ability to export to Iraq during the length of the Cole Inquiry, losing one of their biggest markets. Consequently the scandal resulted in international condemnation and litigation. On 11 July 2006, North American farmers claimed $1 billion in damages from AWB at Washington DC, alleging the Australian wheat exporter used bribery and other corrupt activities to corner grain markets. The growers claimed that AWB used the same techniques to secure grain sales in other markets in Asia and other countries in the Middle East. The lawsuit was dismissed in March 2007. In August 2009, the Australian Federal Police dropped their investigation into any criminal actions undertaken by AWB and others in this matter. The Australian Securities and Investments Commission then proceeded with several civil cases against six former directors and officers of AWB. Two have been against Andrew Lindberg, AWB's former head. Another civil case was bought by shareholders of AWB, and was settled out of court for $39.5 million in February 2010. These facts can characterize the problem associated with an ethics breach from costs side such as social (legitimacy breach), economical (fees) and human (war victims). 2.1. Ethical issues of the AWB LTD dilemma
This particular case can be discussed from different points of ethical theories. At the beginning of our discussion we have to understand the way and reason why the management of this big public socially important company made such as problematic and criminal decision. The main approach that can be used to understand and explain the behaviour of people is Positive Accounting Theory. PAT explains AWB management behaviour as a self-interested, wealth maximizing and greedy organism. However the most important question is how this company has received such a wild possibilities to act on international market on behalf of the Australian government on the middle of military regime?! How this became possible despite of ASIC and other government bodies control. Libertarianism approach suggests that everyone is free of coercion and act until he breached the freedom of someone else. Thus as longer management of AWB LTD were acting against the international law as longer we can highlight there breach of libertarians approach. The questionable Utilitarian approach of...
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