An epic bribe scandal at Petrobras, a major oil company controlled by the Brazilian government, that broke out in 2015 shocked the economic and political system of Brazil. Put simply, the company insiders, outside suppliers and contractors, and politicians colluded and stole billions of dollars from the company via kickbacks, bid riggings, overcharging for construction projects, and the like. The Petrobras scandal led to a sharp drop of the company share price, laying off thousands of workers, and tilting the national economy toward recession. The scandal also seriously tarnished the image of Brazil as a promising emerging market. Discuss in detail what happened at Petrobras and then investigate how the company’s governance and the country’s political culture may have contributed to the scandal. At least 6 sentences: 1 point Grammar and punctuation: 1 point Paragraph with transition sentences: 2 points Appropriate and relevant content with explanation: 4 points Solution Operation carwash was a widespread money-laundering scheme in a state owned enterprise in Brazil called Petrobras that was exposed in 2014. This scandal involved Petrobras top management and high-ranking officials from the Brazilian federal government. A brief summary of the scandal: Paulo Roberto Costa who was the chief of Petrobras refinery from 2004 to 2014 unfairly used his relationships with six of large construction firms in Brazil. These firms were awarded contracts from Costa’s division and they overvalued these contracts by 3%. Petrobras employees turned a blind eye when evaluating bids to these contracts. The overvaluation thus created excess capital for the company. The excel capital was siphoned off in three ways- the officials from construction company pocketed some amount of excess funds, and rewarded their partners inside Petrobras. Some of the funds were also diverted to ruling political parties in terms of gifts, donations etc. The total value of bribes involved in this scandal is approximated somewhere between 3Bn to 5.3Bn USD. Contribution of company’s governance model into scandal: Contribution of country’s political culture into scandal.