casestudy

1. OL 505: Organizational Ethics
Case Study #3
Dale Goodin is the overseas sales manager of Reptar Corporation, a manufacturer of
high tech pumping equipment for the oil industry. Goodin has been working an a very
large and lucrative account for about six months: $7.5 million worth of equipment for the
offshore oil fields in Brazil, which are operated by an agency of the Brazilian government.
In his latest meeting with Bruno Escobar, the Brazilian government’s Underminister of
Energy, Goodin (a 20-year veteran of overseas sales) senses that he’s about to “close the
Deal.” Escobar tells him that he is ready to recommend to his superior, the Minister of
Energy, that the government accept Reptar’s terms and begin shipping equipment as early
as next week. But first, he will require Reptar to pay a “good faith fee” of $7,500 (about 1%
of the deal’s overall value) to demonstrate the company’s “continued interest” in the deal.
Since Goodin has never in his years of sales been asked for such an upfront payment, he
indicates that he will need to check with his superiors.
Scott McClelland, Reptar’s Vice President of Sales, instructs Goodin in no uncertain terms
that he “must do whatever it takes to close this deal.” And he continues: “If you can’t land this
account, there are plenty of younger people in the overseas sales division who can.” When
Goodin insists that he believes he’s been asked to pay a bribe, McClelland simply says:
“Don’t bother me with the details. Just bring me back that contract.”
Goodin consults one more person at Reptar’s home office for advice: head corporate legal
counsel Patrick Hynes. Hynes indicates that the proposed bribe is actually illegal under U.S.
law – the Foreign Corrupt Practices Act of 1988. So Reptar cannot officially authorize such
a payment. “In fact, “ says Hynes, “if you pay this you’ll need to provide the funds personally.
Maybe you could borrow against your anticipated sales commission.” [For a $7.5 million deal,
Goodin would receive a 6% sales commission.]
“Of course, you could always call this Escobar’s bluff and refuse to pay the bribe,” says
Hynes. “But given the customs among Brazilian government officials, you might risk losing
the whole deal. We do have competitors down in Brazil, you know.”
Analyze Dale Goodin’s situation in this case and indicate how it exhibits elements of
each of the following features of role morality as we have examined that concept thus
far:
- Albert Carr’s game ethics*, the specialized morality that pertains to business roles;
- the distinct situational influences*** noted by Philip Zimbardo -- both of which are
in evidence here;
- the points of conflict between what Goodin must do (in role) and the more generic
norms of common morality detailed by Bernard Gert.
Given all of this complexity in his situation, what do you think Dale Goodin should do
in this case? And why?
* Carr, “Is Business Bluffing Ethical?”
*** Zimbardo, “Reflections on the Stanford Prison Experiment”