Question

Erle Smith is the financial controller with Practical Solutions Ltd, an entity that sells software products to accounting firms and small businesses. Mr Smith is analysing a number of software packages that focus on budgeting. He needs to select a package he can recommend to his clients. Each software vendor is keen to have their software selected as it will result in a significant increase in sales for their company. Anitah Loh is a salesperson for software company Dogto Ltd. She has asked Mr Smith to go to Los Angeles to analyse her company’s software package properly, and the programming experts there can give him a thorough demonstration. Ms Loh also suggested Mr Smith take his family, so he feels relaxed in a foreign country and can undertake his analysis without worrying about being away from his family. Dogto Ltd would pick up the expenses for the trip.

1. Do you think Mr Smith should take the trip? Outline any ethical concerns involved.

2. What would be the advantages and disadvantages to Practical Solutions Ltd of having an employee code of conduct? What measures might be included in such a code of conduct?

Answer 1

1. Mr. Smith can take the trip to LA for a demonstration of the software at the expense of Dogto Ltd., as it is for business purpose.

But. he should not accept the invitation of Anita Loh to take the trip with his family particularly where the expenses are to be born by the potential vendor. A conflict of interest would enter the picture, since, if Mr. Smith accepts the proposal of the salesperson, he would become obligated to purchase the software of Dogto Ltd., even if the software does not meet the mark. Mr. Smith, as the financial controller of Practical Solutions Ltd. is expected to keep the best interests of the vision and mission of his employer in mind.

2. Companies may use a code of conduct to guide the behaviors of employees. Ideally, these should align conduct standards with the mission of the organization.

A few advantages of an employee code of conduct :

• It communicates the vision and mission of the company.
• It helps to create an environment of trust and ethical behavior in the workplace.
• Keeps a check on the employees in violating laws and regulations.

A few disadvantages of an employee code of conduct:

• Creating a code of conduct is time consuming.
• Can end up in micromanagement.
• Codes that limit employees' freedom to speak out against the corporation can keep them quiet for fear of job loss or legal retribution even if the company is engaging in unethical practices.