Pegasus Inc. is a company who prides itself for being a model ethical leader who upholds its core values and principles.
Now it faces a dilemma and it has two options: to expand their business in China or forego the opportunity to earn a hundred million dollars because of the "payoffs".
If Pegasus were to enter China, they would earn a whooping $100 million and would eventually attract potential Japanese investors that would contribute to their capital investment. Aside from that, the market for wireless in China is huge and this is in addition to the company's market in the US, Europe and Japan. If this project would push through, Pegasus would be widely acknowledge in Asia. It might also generate market from other Asian countries that demands the use of wireless ...view middle of the document...
An agent would represent them and whatever this agent would do to secure the license would be his own business. Upon hearing that, Tom Oswald has an inkling whether to push through with the project. Giving "Bribes" is against the company's code of ethics and values. It would tarnish Pegasus reputation, that values Integrity and Honesty in doing its business. With that, entering China might plunge the company to an unreasonable risk that might jeopardize its ethical princeples and compromise its values. It would not be practical to undertake such endeavor that would expose the comapany to great peril and subsequently threaten its position in the market.
Therefore, what Tom Oswald should do is to find a way on how to enter China ethically; which is based on their ethical standards.
When the reasercher said "payoffs", they immediately assumed that it is synonymous to bribery. However, that is just an assumption. What if the "payoff" they were talking about is something like giving an extra contribution to improve the city hospital or their sewerage system; or something that would help in the development of the city. If that is the case, then Tom Oswald should just agree to it. It's not really a bribe but rather an extra charge that would benefit both parties.
However, if it's for own personal gain that would benefit a handful of officials then it's not a risk to take. The consequences may brought harm to the company instead of gaining from it.
What Tom Oswald should do are to gather the facts, seek for other's opinions and suggestion and take into consideration the stakeholder, the employees and the customers before making a decision. After that, he must stand by that decision and be accountable for it.