Laudable, culpable and non-culpable decisions - Essay Example

Identify laudable, culpable and non-culpable decisions. Rank culpable decisions and show how context makes some difference to how much blame a culprit deserves Laudable decision Praiseworthy – if some good, or the right thing was done BAES made an initiative to hire Lood Woolf to have an independent and irreproachable investigation into its ethical practices as a business and to identify areas of improvement where its dealings as a business entity can be improved. Despite of all the unscrupulous dealings of BAES, its decision to have an independent panel of investigators to be headed by Lord Woolf that would inquire into BAES ethical standards was laudable. This initiative yielded positive results in identifying which ethical practices needs improvement and produced a recommendation on how to improve it. Lord Woolf himself practiced ethical propriety in setting the parameters of his investigation. Agreeing to investigate cases which are also conducted by SFO would be tantamount into meddling in the investigation by the authorities and thus, would be ethically inappropriate. Non-culpable decision No harm was done In January, 1997, the chief executive officer (CEO) of British Aerospace (BAe), backed Tony Blair to become Prime Minister of the UK. Many business leaders did the same. Although it is not illegal for a business entity to support a politician vying for office, it is deemed inappropriate to back somebody with the expectation of business gains in the future. Though it was not tacitly expressed in the case that BAES solicited for business favours when Tony Blair became the Prime Minister of UK, it was implied that he was returning favours to BAES when acted like a salesman for BAES in trying to persuade the Czech Republic Gripen fighter jets, worth $1bn. No immediately harm was done with BAES’s political support to the candidacy of Tony Blair, but the political gratuity extended by Tony Blair leading to BAES unethical and controversial business practices tainted UK’s defence industry. Culpable decisions Blameworthy Context In 2001, Tanzania paid to BAES $21 million for a military air traffic control (ATC) system that came from debt that was supposed to be spent on Tanzanian education. This decision of Tanzanian President Benjamin Mpaka to purchase an overpriced (at least four times more expensive than civilian radar) air traffic control (ATC) system which was disbursed from a fund that was supposed to be spent on Tanzanian education was most blameworthy. BAES used Shailesh Vithlani, a “marketing adviser” to secure a a ?28m Air Traffic Control radar which was four times more expensive than a civilian radar). Payments to Vithlani were routed through Red Diamong Trading (RDT), a shell company based offshore in the British Virgin Islands (BVI). It would be naive not to have the “obvious inference” that some of the money Vithlani got was used to bribe Tanzanian officials. 2. Outlining standard ways to place blame and respond to it, interpret any defensive utterances by the culprits (and their supporters); and interpret their critics’ (and victims’) utterances Outcome related disappointments/blame-ORD Person/relationship-related disappointment – PRD ORD + PRD (any utterances expressing both) Utterance: Mr Turner said: “we are fully complying with all the SFO’s requests. We are acting in a responsible and dignified way and we are very proud of this company. We think it is unfair and unjust that our reputation is being affected.” Interpretation: BAES is bluffing that they are an ethical company and is offended with the decision of SFO to investigate their company. Utterance: Mike Turner said: “we want to be in a position to provide customers, investors, employees and communities [with] further assurance that our policies, ethics and business conduct are subject to continuous improvement and set the pace for the international defence industry.” Interpretation: It is just a PR utterance that BAES does not really mean to say considering their actual business practice. Utterance: The PM said the UK’s national interest faced “complete wreckage” if the investigation continued. The Attorney-General, Lord Goldsmith, said that the SFO inquiry would be discontinued: first, because there was insufficient evidence of corruption; and, second, to protect national security. Interpretation: We have to compromise so we that would not severe our relationship with Saudi Arabia and just let go of the investigation to keep Saudi’s goodwill. Yes, I am responsible and Yes, net harm was done-concession The best example that we can glean from the admission of culpability was when BAES entered into a plea bargaining with SFO that they are culpable of improper accounting practice. It meant that they did something wrong but will only admit to a lesser crime so that they can still continue to do business. Yes, I am responsible but No, no net harm was done-justification Utterance and case: Robert Wardle of the SFO says in its annual report that dropping the Al-Yamamah investigation was his responsibility. It is my job, independent of the Government, and certainly independent of party politics, to [choose] whether to investigate, but I can’t ignore the public interest. Interpretation: Robert Wardle assuming the flak of a fall guy to save his boss Prime Minister Blair. He justified his decision as safe and no one was harmed. No, I am not really or fully responsible but YES, net harm was done – excuse Benjamin Mpaka, Tanzanian President till 2005, said: “No one showed me any evidence [of wrongdoing]”. It is a denial of a corrupt act that deprived his countrymen of social services that those money were meant to be spent. No, I am not really or fully responsible and/or, no net harm was done – refusal “As with all our business, we regularly audit arrangements [with advisers] to ensure nothing improper is taking place and that we are receiving value for money for advisers’ knowledge.” This is a typical PR utterance of BAES to deny all their improper business behaviours. 3. Evaluate the use of standard normative doctrines to assess the conduct and attitudes on show in this case. Consider whether business should be exempt from such normative appraisal.  Conduct Consequentialist doctrines “Consequentialist Ethical Theory is a general normative theory that bases the moral evaluation of acts, rules, institutions, etc. solely on the goodness of their consequences, where the standard of goodness employed is a standard of non-moral goodness (Stanford Encyclopedia a).  This was simply illustrated with the then BAe CEO support to Tony Blair to become Prime Minister. The support was not because BAe believed in Tony Blair’s platform of governance but out of expectation of a political favour. This ethical doctrine is the natural tendency of business due to the economic to its economic determination that it has to be “utilitarian” to achieve its objectives. Deontological doctrines In plain language, deontological doctrine in ethics meant “doing what is right”. “In contemporary moral philosophy, deontology is one of those kinds of normative theories regarding which choices are morally required, forbidden, or permitted” (Stanford Encyclpedia of Philosphy a). This ethical doctrine is not very clear in the case because none seemed to intend to do what is right. Even SFO who was supposed to investigate the irregularities of BAES business activities even dropped the case. It did not show any hint of doing anything out of fulfilment of a duty or a higher calling. Had this virtue been imbibed in any of the protagonist in the case, BAES would have not bribed government officials and SFO would have prosecuted the Saudi prince and BAES regardless of the consequence. Virtue-ethics doctrines Virtue-ethics doctrine meant doing something good not out of expectation of anything or out of fulfilment of a duty or following a rule or code, but because an individual really intended to do good. It “emphasizes the virtues, or moral character, in contrast to the approach which emphasizes duties or rules (deontology) or that which emphasizes the consequences of actions (consequentialism)(Stanford Encyclopedia of Philosophy b). The closest utterance we can associate with this ethical doctrine was Lord Woolf’s pronouncement that a business’s ethical practice must be irreprehensible. While this type of normative doctrine is difficult to be ingrained in a business organization, every effort should be exerted for the organization to adopt this virtue-ethics doctrine. Arguments for exception (claims for exemption of managers from normative appraisal of their conduct) There were few arguments for exceptions that were used in the case that persuaded for BAES’s not to be prosecuted nor be subjected to normative appraisal due to “pragmatic and security” reasons. Dick Oliver, the BAES chairman utilized the pragmatic consideration not to reopen the case about SFO because he believes that the case had no chance of winning in court. He even told BBC Radio 4 that prosecuting BAES was doomed to fail because there was “no evidence to say that this was anything other than a legal [payment of] commission.” In effect, what he is saying is that it would only be a waste of time and effort to prosecute BAES because the case is not winnable and it only involves a petty issue of paying a legal commission to its “marketing advisers. 4. In relation to this case and comparable cases, if standard ethical norms were not enough to protect victims of corporate misconduct, recommend something that might have protected them.  This case Cases comparable in gravity Weaknesses of normative constraints Normative appraisal is always dependent on the moral and ethical ascendancy of an individual or business organization. In the case study of Robert Wardle entitled “Our people understood why the decision had to be made” it illustrated how can ethical and moral consideration in transacting business can readily be ignored and dropped from the business equation if it does not serve a business objective. The weakness of normative constraint begun when the then British Aerospace (BAe) CEO supported Tony Blair which could have been innocuous had it not been implied that Tony Blair return the fair by acting as a saleman for BAES in trying to persuade the Czech Republic to buy Gripen fighter jets for $1 billion. . Worldcom exemplified the weakness of normative constraints in an organization. When Kim Emigh discovered that their exotic accounting practice will result to tax fraud, he has to resort to external constraints such as the SEC because Kim’s bosses does not seem to care anymore about ethical accounting practice in a corporate environment. Potential of enhanced normative constraints (reactive attitudes) Normative constraints can be enhanced by instituting internal ethical standards that be internalized by the organization as a culture. In the case of BAES, there was an attempt to improve its ethical standards when it hired Lord Woolf to provide recommendations on how can it improve its ethical practices. Japanese companies such as Toyota are best examples where normative constraints are enhanced by imbibing it in their corporate culture. The practice of TQM and Kaizen is to reinforce the company’s ethical and quality practices. Weaknesses of external constraints (codes, regulations, laws) What is legal is not always moral and ethical. Not all good business practices are reflected on the statutes of regulatory bodies such as the case of BAES. This can be best gleaned on BAES’s employment of “marketing advisers” to secure contracts with foreign governments through subsidiaries like Red Diamond Trading to conceal other unscrupulous transactions such as payment of bribes or “special accommodation” to corrupt government officials (i.e. government of Tanzania and Saudi royal family) for the sales to be closed. Similar instance can be found in Mattel, the world’s largest toy maker that despite of the institution of its GMP or General Manufacturing Principle, in the ethical practice of its business, its foreign business partners still circumvents the standards enunciated in it. This is particularly prevalent in China that its local business partners resisted the implementation of the GMP arguing that its system were already in place even before the GMP and being such, they should be exempted. Potential of enhanced external constraints In the case of BAES, the company seemed to be less worried of SFO conducting an investigation than the DOJ. This can be best reflected in the statement of Mike Turner, BAES’s CEO who thought that “the Department of Justice is more robust [than the SFO] about standing up to the press. This implies that external constraints can be more effective if there are other regulatory bodies that will have an economic impact against a business which in the case of BAES, it was worried that it might be prosecuted of corruption by DOJ whose conviction will disqualify it from doing business in the US and EU. Enron is the best example in demonstrating the weaknesses of normative constraints. If a business organization is really bent on achieving its profit motive and hiding its tracks at whatever cost, it will not stop at the slightest idea of scruples. When Enron became the subject of Department of Justice’s investigation, it went as far as compelling its employees to shred documents that will incriminate the company in the investigation. Bibliography Sevenoaks School Philosophy Department (2009-11). Deontological Ethics. Online. Available at retrieved on December 27, 2011. Stanford Encyclopedia of Philosophy (2007). Virtue Ethics. Online. Available at . Retrieved on January 05, 2012 Stanford Encyclopedia of Philosophy (2007). Deontological. Available at . Retrieved on January 05, 2012 Read More