Business Ethics

Charity or Bribery?
Filip Kowalski wanted to be a doctor and after graduating in 2009, he started
with research in a Polish pharmaceutical company. However, he found the slow
pace of medical research, so he leveraged his experience to become a high-
profile sales manager at pharmaceutical company Healthgen, in Polish (Poland)
division.
Kowalski’s task was to seek contracts for the company’s product lines with the
state health agencies in Poland. His boss had set the goal of doubling the sales
of Healthgen’s drugs across Poland by 2018.
Kowalski met Alex Skorupa – regional director for the Poland’s southeast
region at some exhibition and there he told Kowalski to submit the contract bid
for purchase of new drugs. Then they discovered that they both belong to same
place – Bieszczady mountain region. Skorupa also tells that he had co-founded
– the Subcarpathian Wellness foundation – with the mission to improve health
and wellness in the region.
In 2016, Kowalski received a letter from the Subcarpathian regional health fund
for accepting and reviewing bids for drug purchases. Kowalski drafted a bid and
mailed it off to Subcarpathian.
After some days, the mountain region where he lives was badly affected by
flood due to unusual heavy rains. Skorupa called Kowalski and said if
Healthgen is interested to help with the relief efforts, he stressed on immediate
need for cash donations to help poor farmers, etc. Also, the region was highly
affected by Hepatitis A cases.
Kowalski Scheduled meeting with his supervisor and check if the company is
interested in helping, also he found that Healthgen has ample stock of the
Hepatitis A vaccine. Kowalski thought that donating to wellness foundation
would help Skorupa remember Healthgen when he will review drug sales bids
later.
Kowalski’s supervisor said it’s difficult to track cash donations, however, it’s
fine to donate vaccines. The supervisor delegated authority to make final
decision on this matter to Kowalski.
He then consulted the company’s published guidelines but couldn’t find any
specific guideline for donating vaccines. Then he contacted clerk’s office and
found Subcarpathian to be a legitimate foundation. He finally took decision of
donating vaccines keeping in mind the words of his supervisor regarding cash
donations. He successfully sent the vaccines to Skorupa and filled the required
donation reporting paperwork and submitted it to Healthgen Poland’s regulatory
office.
6 weeks later Kowalski got a letter from Skorupa explaining that the bid has
been accepted. This was the biggest contract Kowalski managed to secure. But
some days later, he got to know that an investigation reports that there is some
connection between Vaccine donation and winning bid contract with the health
fund in the region. The report considered donation and contract to be a tradeoff.
Kowalski was shocked.
Were the efforts to boost company sales and support public health a donation or
a bribe?
What should Filip do?

Moral muteness: 1) Harmony

2) efficiency
3) Image of power and effectiveness
Pestel analysis:
P- Political
E- Economic
S- Social
T- Technical
E- Environmental
L- Legal
Moral intensity and framing:
1) Magnitude of consequence
2) Social consensus
3) Probability of Effect
4) Proximity
5) concentration of effect
Rationalizations:
1) Denial of responsibility
2) Denial of victim
3) Denial of injury
 4) social weighing
5) Metaphor of the ledger
Ability and willingness to cheat
Willing to cheat + Ability to Unwilling to cheat + ability
cheat to cheat
- Corrupt - Cognitive efforts to
officers/businessman find reasons not to
cheat

Willing to cheat + unable to Unwilling to cheat + Unable

cheat to cheat

Cost benefit analysis of fraud:

Perceived benefit of corruption

HC, LB HC, HB
conflict Resistance

Perceived cost of corruption

LC, LB HB, LC
Indifferent Favourable A new model of
Ethical Leadership