Ethics Case Analysis

The best option for the plant will closely align with the values TAPC established in the recently rebuilt mission statement.

Option 1 is to purchase electricity from the City of Sabah. The main benefit is a reliable supply of electricity at a low cost. This would lead to fewer shutdowns of the plant and increased profits. The plant would remain in the same location, so there are no job losses.

To continue to receive a low price for electricity, a charitable donation would have to be paid on behalf of a City official. Because the intent of the bribe is to retain business with the City at a lower cost than is available to other customers, it is illegal under the Foreign Corrupt Practices Act. If caught, the penalties are stiff. Legal action would tarnish the reputation of the company. TAPC has recently placed internal controls to detect corruption and instituted penalties on employees who violate its bribery policy. It would be unethical for TAPC to contradict its own internal policies by issuing a bribe in Malaysia. Even if an agreement is reached, the City may still negotiate the prices again on short notice. If there is no long term cost reduction in electricity costs, then long term profits cannot be predicted from this option.

Option 1 does not address the plant’s inability to prevent water contamination. The current levels of pollution are not illegal in Malaysia, but environmental conservation is an important issue to the employees, who are key stakeholders. The company has committed itself in its mission statement to performing above the minimal standards and must take action. TAPC has a duty to its stakeholders to make environmentally sustainable decisions.

Option 2, a co-generation plant, has several benefits. A co-generation plant provides electricity at a steady cost for many years. Obtaining a government grant to subsidize some of the costs decreases the initial investment and TAPC can supply the community with cheap, reliable electricity for the...