Read the “Siemens Bribery Scandal” case beginning on page 150 of your textbook a
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Question
Read the “Siemens Bribery Scandal” case beginning on page 150 of your textbook and answer the questions that accmpany the case.
The questions must be answered using an essay format. Submit the paper following the guidelines of the APA including academic references as appropriate. References taken from Wikis are not appropriate for this course. This is a 300 level course and you are expected to demonstrate good use of the English language. Spelling and grammar errors are unacceptable. Make sure the essay has an introduction and conclusions and is formatted following the recommendations of the APA.
Siemens Bribery Scandal
1 What explains the high level of corruption at Siemens? How did managers engaged in corruption rationalize it?
2 What do you think would have happened to a manager at Siemens if he or she had taken a stand against corrupt practices?
3 How does the kind of corruption Siemens engaged in distort competition?
4 What is the impact of corrupt behavior by Siemens on the countries where it does business?
5 If you were a manager at Siemens, and you became aware of these activities, what would you have done?
Explanation / Answer
Q1. What explains the high level of corruption at Siemens? How did managers engaged in corruption rationalize it?
The Siemens scandal was the greatest of its kind in German history. It caused damages of about 1.6 billion Euros. The company managers gave bribe to their business partners and government officials in order to win contracts. Further, the employees who left the company were given good payoffs in order to keep the secret of the illegal affairs of the company. In the year 2006 the authorities revealed the massive scandal. It had continued for almost 7 long years where the company had paid illegal bribes of about 1.3 billion Euros. The bribes were paid to lower level government officers, business partners and also to the whole government. The bribes were paid by around 300 employees. Also in order to maintain the privacy the employees while leaving the company were paid handsome payoffs. The managers who engaged in corruption had no choice than to follow the trend since it was a huge vicious circle which involved the topmost people from the authority as well as the company.
Q2. What do you think would have happened to a manager at Siemens if he or she had taken a stand against corrupt practices?
In the event that any manager would have tried to take a stand against the corruption practices then he would have become a target of the officials engaged in these practices. The consequences could have been very dangerous for the manager since it was a too dirty vicious circle to be broken easily.
Q3. How does the kind of corruption Siemens engaged in distort competition?
Corruption activities are responsible to create unfair competition in the market. It distorts the market competition since here the company engages itself in unfair practices to win contracts and carry on its business. This eliminates the healthy competition from the market.
Q4. What is the impact of corrupt behavior by Siemens on the countries where it does business?
Siemens decision to pay bribes in order to win contracts in many countries had basically become a part of their company culture to conduct business. This practice also was responsible to leave behind angry competitors who were left without contracts.
Q5. If you were a manager at Siemens, and you became aware of these activities, what would you have done?
In case I would have been a manager at Siemens and I became aware of these activities then even if I wanted to act ethical and raise my voice but still taking into consideration the huge vicious cycle strengthened by the strongest people , it would have been next to impossible for me to raise my voice. I would have left the company since I would not want to be a part of such unethical practices.
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