Taher made the business decision to cover up the inefficiencies of the bank’s new system. He feared that the inefficiencies could affect the huge profits that the bank earned. Consequently, he opted to engage in an unethical business practice. Although the decision was appropriate for that time, it could affect the bank at a later date; thus, it was not the right one.
The main reason for unethical business practices is cover up. The cover up is aimed at preventing negative publicity of an organization. For the case study, Taher decided to authorize Asian partners to offer cash to the customers that were affected by incorrect service information so that he could cover up the inefficiencies of the card system. This was aimed at preventing the bank from suffering the negative consequences of the inefficiencies.
A person adhering to the principle of right would not consider Taher’s decision as ethical. This is in relation to the fact that the decision infringes on the rights of VIP card users to accurate information. It denies them the right to know what the card can do and/or not do to them. In this case, a person that adheres to this principle would be concerned more about the rights of the people that use VIP credit cards as opposed to the impact that the decision would have on the bank’s profit. Consequently, Taher’s decision would not be ethical so long as it infringes on the rights of card users. It would only be ethical if it would not infringe on the rights of card users.
If the hotels offered good services to the cardholders who were affected by the wrong information, the ethical consideration in the scenario would not change. This is in relation to the fact that the wrong information would affect the bank’s system at a later date. It would also affect the hotels at a later date. Consequently, no matter the good services, there was the need to rectify the problem as soon as it was identified. Although this might have affected the bank’s profit for some time, it would be the right thing to do because it would save the future of the bank and hotels. This suggests that ethical business practices remain important in business no matter their immediate negative consequences to businesses.
This decision depends on the location of the bank. If the bank is located in USA, then it violated the Foreign Corrupt Practices Act (FCPA) because the act is applicable in USA. However, if the bank is located in other parts of the world where FCPA does not apply, then the bank did not violate FCPA.
A corporation or any other institution would prefer to be seen as ethical for many reasons. To the government, it would prefer to be seen as practicing what business law stipulates so that it cannot be confronted with unnecessarily legal hurdles. To the customers, it would prefer to be seen as fair and honest so that customers cannot boycott its products or services. To its competitors, it would prefer to be seen as competing fairly so that it would not be accused of unfairly business practices and competing unfairly. In all these cases, a corporation aims at protecting its reputation and business practices. This helps the corporation to conduct its business practices without facing unnecessary hurdles that come with unethical business practices.