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    Public Relations - Kickbacks?

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    You are the senior vice president of marketing and communications for a medium-sized manufacturer headquartered in your city. Your company is bidding on a major contract in an Asian country. If your firm wins the contract, the company's revenues could double over the next five years. Plus, you will likely have the inside track on additional contracts in that country. Your company is competing for this contract against a French company and a German company. Your company is confident that it can provide a better deal to the Asian country. But there is one small problem, the country's minister of trade would appreciate receiving a kickback. You know that both the French and the German companies would likely acquiesce to the minister's request, which is not unusual and generally accepted in that part of the world.

    1. Draft a persuasive memo to your CEO recommending what he should do in the above circumstances.
    2. Back up your argument with applicable facts.
    3. Remember, you are the company's chief public relations officer, so you need to consider the implications on various stakeholders.

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    Solution Preview

    Let's look at several key points to consider in making a case for not offering kickbacks. Rather, it is imperative to keep your confidence in company strengths and ability to offer a better deal than the competition. Compromising ethical standards has serious implications (e.g., even though generally accepted, kickbacks are still illegal and unethical; research and court case supports the negative implication of corruption for all stakeholders).

    Let's look closer at these arguments. Your memo might begin something to the effect of this.

    Dear CEO:

    We are confident that our company can provide a better deal to the Asian country. It is therefore imperative to focus on the strengths of our company and what we have to offer, while not considering giving kickbacks to secure the contract, even though our competitions might do otherwise. This is the best option for several reasons.

    And so on (see potential points to argue below).

    Potential points to use in your case against offering kickbacks to secure the contrast might include the following:
    1. It is unethical business practice and challenges our professional integrity that guides all company decisions.
    2. It is also illegal. Although kickbacks are accepted in the Asian countries, they are still considered illegal, even though the police do not often sanction them. However, since it is not legal, it ...