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This paper describes the controversial situation from the ethical point of view that occurred in the company called Golden. It should be noted that Golden, with its headquarters in New Jersey, is a company that employs more than 150 employees and operates in the manufacturing sector. Its activity is highly dependent on the spare parts supply from Chinese producers as well as the local suppliers of the specific program software. It is noteworthy that the company applies the norms of the Code of Corporate Ethics to the regulation of its operations.

Matthew Green is a product line manager employed at the supply chain development department. He collaborates with another four managers and the head of department, Steve. The company decides to expand its activity and searches for the new supplier. Steve has found a new supplier, but the prices for the spare parts were rather high comparing to the existing commercial proposals from other suppliers. Steve explained it as a desire to shift the company to the new level of quality and status. However, a week later, Matthew received accidentally information that the agreement was based on a kickback and Steve got a good percentage of the contract amount. As far as Steve and Matthew have been working together for seven years, Steve decided to talk to Matthew before going to the top management. Steve proposed Matthew to refuse the disclosure of this information in exchange for a portion of the amount received.

Due to the current situation, it is worth answering the following questions:

  1. What norms of the Code of Corporate Ethics did Steve breach?
  2. How should Matthew react to the following circumstances taking into consideration an

 ethical background?

What norms of the Code of Corporate Ethics did Steve breach?

The Code of Corporate Ethics at Golden as written procedures and standards facilitates application of the highest ethical values to its daily operations. Moreover, it regulates the relationships with the customers, suppliers, governmental authorities, competitors, shareholders and employees. Consequently, each employee should deal fairly with the customers or suppliers and avoid deceptive or misleading actions. Moreover, it is substantially to point that company’s interests are of paramount importance in the resolution of any conflict of interest. Thus, compliance with the Code is obligatory to all company’s employees.

It is stated at the Code of Corporate Ethics that each employee should act while performing his/her professional tasks with the best interest of the company. Steve, as an experienced manager having a high degree of confidence from the senior management, was authorized to take a decision on the choice of suppliers. He had the reputation of a fair and conscientious employee who is guided during the decision-making process within the professional ethics and corporate ethical standards.

With this regard, first aspect to mention is that Steve was involved in the conflict of interests. The Code of Corporate Ethics contains a norm that requires avoiding any interference of employee’s personal interest in the company’s business when deciding on the choice of suppliers in particular. Steve’s personal interest in the form of receiving some percent of the contractual sum was placed higher than the interest of the company.

Moreover, his actions also could be interpreted as bribery. His choice of a supplier was not founded on the equal and transparent choice, based on the best ratio of price and quality of spare parts, but was dictated by the desire to satisfy Steve’s own material interests. He signed a contract that worsened the financial position of the company in view of the acquisition of spare parts at inflated prices. Thus, actions of Steve caused financial damage to the company and violated the norm of Code of Corporate Ethics about dealing with the suppliers on a fair base. This is an example of unacceptable practice.

How should Matthew react to the following circumstances taking into consideration an ethical background?

As a Golden’s employee, Matthew should place the company’s image, reputation and the transparency of its operations above all. The Code of Corporate Ethics prescribes the employees in case of revealing any situation that causes the worsening of the image of a company as a business entity that conducts business with suppliers on the equal basis to report about such cases to the top management.

It is essential to point that Matthew was proposed to receive money for keeping silence about this matter. Matthew understands that it is inconsistent with the Golden’s Code of Corporate Ethics because he observes a self-dealing conflict of interest in such a proposal. Therefore, he should report the evidence of unethical behavior towards other suppliers that could propose better conditions in terms of price and quality of spare parts than the chosen one.

Honesty should be the main ethical value that has to drive Matthew into making this decision. He has no right to evade responsibility for the operations that undermine the reputation of the company. Furthermore, Steve tried to persuade the top management that this new supplier proposed higher prices for the genuine quality of its spare parts. Taking into consideration that fact that Steve have been working for the company for more than 10 years, and earlier was not involved in any ethical conflict, top management of the company accepted this new commercial offer, not suspecting Steve’s core motives.

Consequently, it is Matthew’s core obligation to report about such unethical behavior demonstrated by Steve. Top management should know that Steve acts illegally taking bribes in the form of kickback negotiated with a new supplier. Golden should not employ a person who violates the company’s Code of Ethics, undermines the trust in himself, and cannot be employed at the position that involves compliance with the high moral principles.

Code: Sample20

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