Laws and Ethics

For any business to flourish and achieve its desired goals it must abide by the rules and regulations set both internally and externally. Leaders of any organization need to be sufficiently self aware, cognitive and morally developed in order to understand not only how to develop a shared vision within their organizations but also how to effectively communicate and implement it through organizational development and stakeholder engagement processes (Mann, Roberts& Smith, 2005).

Defying laws can make a business or the owner face penalties and punishments. In this case where a business unit where there are allegations of irregular accounting practices, and evidence of bribery of local officials. The accounting provision and the anti-bribery acts have been violated. The firms accounting books should be present; the records are suppose to be accurate, detailed and should reflect the various transactions that have taken place (Bragg, 2006).

This is important because it ensures that assets and other business property are properly accounted for and the people in authority have access to the books of account whenever summoned to do so. Moreover, money is used in the areas it has been budgeted for. Accepting bribes means that money is being spent in areas where it is not supposed to be used for creating unnecessary expenses for the business and it may also imply that the business officials are accepting bribes for certain favors and this has affected the reputation of the company.

If such cases continue, the some departments of the company will not have funds to carry on with its operations and this eventually leads to the poor performance of the organization. It business unit may become a victim of Corruption allegations and this will mean lack of trust in the employers and employees of the unit and for this reason they may be charged in court or lose their jobs (Peterson and Farrell, 2005). A similar case scenario to this one is the new GreatestColas Divisional Vice-President for Eastern Europe who is facing major managerial issues upon his promotion to office.

While meeting with the key leadership personnel in order formulate strategies to meet divisional goals, he is shocked to learn that the operations manager is the son of a prominent local politician a concession made by his predecessor to obtain the necessary building permits. Additionally, a review of the books shows an accounting mess and that 5% of gross revenues are used for bribes to fund organized crime and ensure that there are no transportation problems. The result of these actions is a reduction in the unit’s sales and less money to fund its other projects furthermore; they are losing markets because of persistent corrupt allegations.

Poor performance of this division has affected the GreatestCola’s in general. No wonder they replaced the previous leader. From this case, we can see that bribery is not a thing that they started recently and it is seen by the appointment of an incompetent operations manager in order to benefit (Megone & Robinson, 2002). The accounting mess is an indication that they are trying to cover up for the embezzled funds. Poor accounts mean fewer profits for the business and less money to pay its staff and adequately meet its operating expenses.

In addition to this, they are losing markets because of these bad business practices and this is not beneficial the organization. Conclusion The costs of illegal and unethical activities are serious and drastic as they can lead to the loss of reputation, criminal penalties, a lot of time wasted in investigating and correcting wrong doings therefore as soon as such behaviors are realized, they should be corrected and measures taken to prevent such cases from arising(Wines, 2006). The management should also be committed in doing the right thing in their personal and professional lives.


Bragg, S. M. (2006) The Ultimate Accountants’ Reference: Including GAAP, IRS & SEC Regulations, Leases, and More Ed. 2. Published by Wiley-IEEE Mann, A. R, Roberts, B. S, Smith & Smith. L. Y (2005). Roberson’s Business Law. Ed. 13 Published by Thomson West, 2005 Megone. C, Robinson. S. (2002). Case Histories in Business Ethics: Virtues and Moral Decision Making in Business. Published by Routledge Peterson, R. A & Ferrell. O. C. (2005) Business Ethics: New Challenges for Business Schools and Corporate Leaders. Published by M. E. Sharpe Wines, W. A. (2006). Ethics, Law, and Business Published by Routledge