Case-study Honor the cost of Philanthropy/Charity As chief legal officer in a well-respected company making lifesaving d

[answerhappygod]

Case-study
Honor the cost of Philanthropy/Charity
As chief legal officer in a well-respected company making
lifesaving drugs, Alistair has
been asked by his board of directors to look into rumors of
price-fixing in the firm's
European offices. His board has a very strong ethics policy, and is
especially wary of
price-fixing, bribery, kick-backs, and other unethical activities
that can plague overseas
operations. After several months of detailed interviews in Europe,
Alistair satisfies
himself that the rumors are groundless. "There's no issue here," he
heard several
managers say. “But,” added one such manager, "if you really want
something to
investigate, look into the Bosnia contract."
Over the months, Alistair keeps hearing about "the Bosnia
contract." So, when he
finishes his report on the price-fixing rumors, he decides to
satisfy his curiosity on this
matter. The contract, he discovers, is ordinary in almost every
respect: A major relief
organization has contracted with his company to supply a million
inexpensive kits of
medicine for delivery into the war-torn regions of Bosnia. Like
most such contracts with
charitable organizations, it contains hardly any profit for his
firm.
What he finds strange, however, is the payment of an
extraordinarily large commission
to a Romanian distributor to deliver the kits deep into Bosnia.
Seeking out the executive
in his own firm who negotiated the contract, he has one question in
mind: Is this a bribe?
“Yes and no,” says the executive. According to the Romanian
distributor, the backs of
the delivery trucks are loaded with the kits—and the glove
compartments are stuffed with
cash. That way, when the drivers are stopped at roadblocks set up
by local militia units
operating all across Bosnia, they can pay whatever is demanded and
continue their
journey. “In the past,” he notes, “drivers without cash have been
taken from their trucks
and shot. If the kits are to be delivered, this is the cost of
doing business.”
Alistair feels sure that none of the money has flowed back to the
executive, whose only
motive is to get the kits delivered. And by this time, the
deliveries have already been
made. Yet Alistair still faces a dilemma. Should he draft a
separate report to the board
on this most unorthodox contract—possibly causing great harm to the
executive who
negotiated it or embarrassment to the relief organization, which is
aware of the
commission? Or should he keep silent?
Questions
1) Does the company conform to high standards of ethical
behavior?

2) Discuss the CSR strategy of the company in relation to the
following
approaches to CSR. How should this company implement these
strategies?
▪ Philanthropy
▪ Incorporation of CSR strategy into business strategy
▪ Creating Shared Value, or CSV
▪ Benchmarking strategy