Background
The case presents an ethical dilemma among top management in Almond China. One side (Chongqing Executive) is of the opinion that the company should avoid wasteful procedures and standards which among other things require that management should not bribe customers by giving them commissions or oversea trips in order to do business. Almond Chemical, the mother company located in Germany observes high standards of safety among employees, environment, product quality and proper disposal of waste.
The challenge however arises when the company starts operating in China and a section of the executive thinks that there is no need to observe these standards and procedures in the Chinese business environment. Those in opposition think that they’ll be able to reduce expenses, get more clients and then make more profits by violating these standards. The other members of the board are against bending of rules in order to make quick profits (Xin and Haijie 2).
What should Liu Peijin do?
Liu Peijin, the President of Almond China is in a tricky situation. His conscience and belief in adherence to procedures and ethics have been defiled by the board which thinks that for them to get orders; they should bribe customers with commissions and trips to Europe. Peijin should accept his colleagues’ suggestion because of two reasons.
One, he is the only person on the board supporting the safety and ethics standards. This means that, as an individual he cannot oppose a complete board which is already determined to violate ethics and safety standards.
What are the problems in this case?
There are several problems presented in the case. To begin with, the company has not been running at a profit because of its strict procedures which demands that the company maintains high standards of safety like workers putting on expensive helmets from Europe and proper disposal of MDI wastes. As alleged by some of the executives in the board, the company is spending a lot of money on precautionary measures which do not generate income to the company.
Secondly, the board members are required not to give bribes or any other inducement to get orders from customers according to rules of the company. However, the Chinese situation is different because companies have to give bribes to customers in form of trips abroad or commissions in order to make sales. It is obvious that without bribing Almond Chemical China will not be able to make any major sale in China.
Thirdly, members of the board have different perspectives on how to go about the whole issue. On one side is Schulman Dolf (Vice Chairman of the Venture and Vice President of Business Development) and other members of the board who think that they should go ahead and give bribes to be able to do business and Liu Peijin who thinks that they preserve the integrity of the organization by not giving bribes.
He maintains that the company should continue with safety measures within the company and to the environment because of a situation he witnessed in the past when an accident took place in the company he was working for and because employees were not protected they were seriously injured.
What are the options for Liu?
Liu Peijin has few options. The first option he has is to resign from the company because he says that one of the reasons that motivated him to join the company is the values and standards the company up holds.
The second option is a little bit risky, but it is an option any way. Liu Peijin could lobby for support from the headquarters in Germany so that the Chinese branch can receive instructions from the head office warning the board against proceeding with those activities that violate the company’s standards of safety and ethics.
The second option however is very delicate because it depends on the willingness of the head office to intervene. If the will does not exist, then he risks isolation by his colleagues on the board.
The third option is to accept their proposal because they are the majority. As the saying goes, “If you cannot beat them, join them”. This will give him an ample time and will reduce points of contention with his colleagues on the board. Being the President of Almond China, he needs the support of other members if he is to steer the company in a positive direction.
What should you do? why?
If I was him, I would seek a transfer to a branch where the values I believe in are upheld. This is because I still want to keep my job in Almond Chemical. I would achieve this by presenting my case to the management at the head quarters in Germany explaining why I need the transfer.
If the request for a transfer is not granted then I would resign from the company and seek employment else where because my belief on integrity cannot be compromised.
Work Cited
Xin, Katherine and W. Haijie. Culture Clash in the Boardroom, Harvard: Harvard Business Review, 2011. Online.