Many business leaders believe that engaging in global business provides opportunities to expand and stay competitive. As guidance on how U.S. business people should conduct themselves while working overseas the Foreign Corrupt Practices Act was created in 1978. The law makes it illegal for employees of U.S. companies to make “questionable” or “dubious” contributions to political decision makers in foreign nations.
Imagine you are a CEO of a company and was informed your predecessor was fired by the Board of Directors for under performing. Even though this is your first day on the job you are concerned you may fall under similar fate due to the phone call you just received from the Vice President of Sales. The government in Iraq is preventing your shipment of components to leave its country. You know without the parts your company won’t meet 1st quarter sales nor will you make next quarter.
Go to “SEC Enforcement Actions: FCPA Cases” found at http://www.sec.gov/spotlight/fcpa/fcpa-cases.shtml and read either the “SEC Charges Stryker A Second Time for FCPA Violations” or “Legg Mason Charged With Violating the FCPA” press release. After viewing these cases do you think you, the new CEO, should pay a bribe to get the Iraq government to release your shipment to save your job and to meet the sales goals? Give a rationale for your response.
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