Siemens: Just Breaking the Eleventh Commandment? (Case Study)
Q1. What are the main
individual and situational factors encouraging the alleged bribery at Siemens?
which in your opinion, are the most important?
The
surrounding effects that Siemens bribery scandal went through from individuals
that were directly responsible for such an unethical behavior and to
situational threats that made bribery the only way to make business, especially
when dealing with poor countries and corrupted governments. And after going
through investigation, it became clear that corruption was more than a way to do
the job but it was a corporate culture within the industry. Although, to make
it more tempting and exciting, the German corporate tax code only made bribery
technically illegal in the late 1990s which really affected many organizational
cultures in terms of change to unethical behavior. Another important factor is that employees
were to be involved in some way while
dealing with pressure from the competitive market, other loyal employees, and
higher management. As a result, I believe that a strong corporate culture in
this case enriched the corruption and
employees were happy to cope with.
The main individual factor that encouraged bribery
at Siemens:
1- Psychological factors are concerned of how people
think from an ethical decision point of view.
2- Personal Values might be regarded as moral
principles or accepted standards of a person. So, in this case, all person's values will determine how he
will perceive any
particular situation. In this situation we can determine the personal
values, by going through the
decisions Siemens have made, and what was the important factor that leads to
this situation.
3- Personal Integrity that reflects the
personal value, and means that we should always do what is right regardless of
any consequences and implying such trustworthiness was not reflected in Siemens
organizational culture and behavior.
Q2. Explore the
corruption scandals in terms of the issue-related factors discussed in chapter
4, namely moral intensity and moral framing. To what extent did the firms
featured experience corruption as a morally intense issue and what impact did
the moral framing of the activities involved have on this?
Certain characteristics of issues may verify their moral
intensity. In general, issues with a lot of
serious consequences are likely to get to a higher level of intensity. Also,
issues that are considered by a societal consensus is to be more ethical or
unethical are more likely to engage with ethical decision making processes. On
the other hand, the components of moral intensity and the effect they might
have on the ethical decision-making process are influenced by the type of
situation.
The moral intensity in this case can be perceived in different
perspectives to the way the issue is framed. Because the most important aspect
of moral framing is the language used or the frame in which we put our moral
issues in. And, based on moral framing, Siemens framed bribery as a strategy to
open new markets and a way to do the job.
Q3. Critically evaluate the initiatives Siemens has implemented to address bribery problems across its operation. Are these sufficient or would you suggest further action?
Corruption is a social concern that corporations
can't ignore, it is the main issue that
directly affects the company and society. Corruption is becoming an
important issue for businesses to address. Basically, It will lead to diverting
the resources from major services like education, and health care to un-honest
government.
Siemens is trying its best to prevent corruption by
introducing an anti-corruption approach especially after going through all the mentioned
scandals. They have hired an American law firm and spent millions on the
internal investigation, also they implemented new measures to enhance
transparency and accountability within the organization. They
have also appointed a former German finance minister as an in-house monitor to
help ensure that the company remains free of corruption.
I think that their actions are not sufficient,
Although, I suggest that they :
1- Must embrace a strategic corporate social
responsibility plan and make that a part of their CSR mission.
2- To be more proactive
especially when solving problems related to the business.
3- Take a greater leadership role in the
anti-corruption effort by supporting compliance and collective actions.
4- Changing the company's long-standing culture that
upholds bribery as a way of work.
Q4. Thinking of bribery
from the perspective of wider society, do you think that a fine however high is
an adequate response? What penalties, for instance, could you suggest to foster
more ethical values at the company or higher personal integrity on the part of
its employees?
Talking about the bribery side effect on the society
and economy will create a less favorable business environment and will
weaken trust in public institutions and challenges democratic principles. I
guess that paying a fine will be accepted to some extent if we consider it as a kind of
compensation for the misuse of resources. But on the moral side of this
punishment, it may be inadequate because of its failure in changing the
organizational culture and behavior and re-orienting the management and
employees back to the proper track. Also, paying a fine will not change society's negative view of the organization. For that reason, i believe that re-formulating the
plans and strategies on a social, moral, and ethical base is the best pathway
to build a non-corrupted environment.
Finally,
In terms of the best punishment for such cases, I believe that prison sentence will be the strongest deterrent punishment after paying back the
misused money.