Corruption and Bribery in Siemens Global - Case Study Example

? Corruption and Bribery in Siemens Global Legal and ethical issues in Siemens Global Until 1999, corruption marred most of Siemens’ global operations thanks to the laxity in regulations in many countries where Siemens operate. However, the trend took a drastic shift from the year 1999 after a new CEO took office of the great company that had accumulated a myriad of ethical and legal issues over the years (Fernando, 2010). This essay seeks to answer some legal and ethical issues as concerns Siemens Global. Given the massive size and scale of the corruption, do you feel that the punishment was acceptable? Considering the magnitude of the corruption witnesses in virtually all Siemens subsidiaries across the globe, I strongly feel that the US and the German governments grossly under-fined the German company especially considering that at the time, Siemens used to accrue over over70 billion Euros of sales annually. A miniature fine of only $ 1.6 billion did only encourage the company to perpetuate the already worse unethical behavior by bribing the US investigators. Had the regulating authorities impose a much heavier fine on Siemens, the company management and to an extension its employees, would have taken a second thought as far as massive corruption and bribery are concerned. If you were the new Chief Ethics Officer, how would you have handled the situation? As the new Chief Ethics Officer, I would have taken a slightly different course in that instead of summarily dismissing culpable employees, I would have engaged them in the reform process. Since there is no absolute ethical standard or person, the first step would have been to embark on massive employee training process, sensitizing, and enlightening the employees on the benefits of conducting themselves in accordance to acceptable ethical standards. By indulging all the concerned parties in extensive consultations, communications, and negotiations, I think I would have brought back the company to its original course much faster. This is because empowering and encouraging employees has the overall effect of transforming the employees’ culture and subsequently, the organization’s culture, for the better (Fernando, 2010). Was the corruption justified since bribery was legal in Germany until 1999? Before the German government put a ban on bribery and corporate corruption, most companies perceived this as an easy way of going about their business operations. Singled out was the electronics giant, Siemens, which took absolute advantage of the situation in order to gain undue competitive advantage. Several reports quote Siemens top executives insinuating that corruption and bribery gave the company the competitive edge that saw it stay ahead of the game for years. As some may want to believe that Siemens was compliant by engaging in corruption, it beats logic to deny that this act is unethical. By all standards of fairness, any acts of corruption and bribery amount to the breach of acceptable ethical codes of conduct (Twomey et al., 2011).  Ethics and moral justice should prevail in all corporate affairs and no company can justify corruption and bribery as a strategy for achieving company objectives. This is especially so if the acts of corruption and bribery infringe on the rights of other equally competitive companies like the right to fairly and transparently compete for tenders and contracts. Therefore, whatever reason Siemens referred to, there is not a single justification for their unethical behavior (Twomey et al., 2011).  How does an organization make the shift to refine their ethical practices when there is such a radical change in policy? It is no doubt that ethical recovery is an agonizing experience for most companies especially if they were operating on a global platform. However, most organizations do manage to refine their ethical practices after a radical policy change. This, they achieve by following certain approaches that range from transforming the employee and organization culture to putting in place new strategies and measures that may at times impact on the management structure. The company may embark on massive employee training and empowering process where the employees get to understand corruption risks and the benefits of upholding high ethical standards. Rekindling trust and confidence between the employees and the company management is a sure way of improving the organization culture to suit acceptable code of conducts. On the other hand, an organization can make an overhaul to the management structure, depending on the extent of infiltration of the unethical behavior. This ensures that the top management will lead by example and that rogue executives do not find a leeway of retrogressing the company’s image (Fernando, 2010). By researching online, what have been more recent developments with Siemens Global in regards to their ethical policies and protocol? From the time when Siemens had to deal with high profile cases, the company has over the years embarked on a transformational course, undertaking major ethical developments along the way. The first notable change in the ethical policies and protocol of Siemens was the introduction of zero tolerance to corruption by the then newly appointed CEO who was keen on revamping the whole structure to ensure a transparent Siemens. He facilitated this by appointing former vice chairperson of Transparency International to be part of the team to realize ethical transformation. Another latest development is the increment of the number of staff compliance staff from the original 86 to an overwhelming 500 ombudsmen (Schubert & Miller, 2008). Imagine you were the CEO of your own company. Write a brief ethics policy (100-200 words) of the organization. In addition, list your corporate culture values by which you operate your organization. How would you infuse these values into your organization? Give at least three examples. Ethics Policies The ethical commercial conduct policy stipulates that all business conduct and operations to be fair and transparent. This entails the use of appropriate communication mechanisms with suppliers and other stakeholders. The marketing and advertising procedures should be fair and not harmful to competitors’ image as this is a sign of refined business courtesy. The company policy provides clear guidelines on conflict resolution mechanisms in order to enhance relationship with all stakeholders and avoid lengthy legal procedures that may arise out of conflicts. The next company policy exempts any company employee to transact any business on behalf of the company on an individual level. Finally yet importantly, the company emphasizes on proper documentation of all information pertaining to the company (Fernando, 2010). Corporate culture values To ensure customer satisfaction and interests prevails over all interests To conduct business according to acceptable code of conducts To strive to transform employee and organization culture to match the dynamic corporate world I would infuse these cultures into my organization through different approaches. The first would be the loyalty and trustworthy approach where I would instill employee confidence on the general management of the company. The second approach would be incentives approach where I would offer rewards to best performing employees as an encouragement. Finally, I could opt to train employees and give a listening ear to employees’ needs and preferences (Fernando, 2010). References Fernando, A. C. (2010). Business Ethics and Corporate Governance. Delhi: Dorling Kindersley. Twomey, D. P., Jennings, M., Fox, I., & Anderson, R. A. (2011). Anderson's Business Law and the Legal Environment. Mason, Ohio: South-Western Cengage Learning. Schubert, S., & Miller, C. (2008, December 20). At Siemens, Bribery Was Just a Line Item. The New York Times, Available from http://www.nytimes.com/2008/12/21/business/worldbusiness/21siemens.html?pagewanted=all Read More