Bribery Scandals - Siemens Ag in 2006 and 2007

EXECUTIVE SUMMARY

This paper examines the landmark case of Siemens bribery scandal by doing an ethical approach analyses for the case. It will be organized in the following way: firstly, I will briefly introduce the case; secondly, I will analyze the ethical problems involved in the case; thirdly, I will check the effect of the German environmental, economic and law system that cause the problems to happen; and finally, I will discuss the impact on the employees. I will end the paper with a conclusion if bribery is justified or not.

Abstract

This case discusses the bribery scandals that were exposed at Siemens AG in 2006 and 2007. There were a series of scandals that involved some of the company's employees bribing foreign officials to gain contracts and creating slush funds for this purpose.

In addition, in order to gain their support for its policies, the company was accused of bribing labor representatives on the supervisory board (AUB). After the German authorities performed raids on Siemens offices and private homes in Germany, investigations were also started in several other countries like Italy, Switzerland, Greece and the US for possible misconduct.

In the light of this scandal, the chairman of the supervisory board Heinrich von Pierer and the CEO of the company Klaus Kleinfeld had resigned even though they were not directly implicated.

At the same time, many other German companies like Volkswagen had echo's of bribery acts which raised the question of the effectiveness of the Co-determination law in Germany, which advocated a system in which a supervisory board governed the management board and at least half the supervisory board seats had to be filled by labor representatives which led to a suspicious alliance between the two boards.

Finally, the case highlights the opinions of several analysts on the issues related to bribing by the German companies and Siemens in particular and the challenges the new CEO is likely to face at Siemens and the steps taken by Siemens to solve the problem.

Ethical analysis approach of Siemens bribery Scandal

Siemens case had many ethical breaches and problems; we can analyze it form different approaches.

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