The Ethical Environment of a Company's Leadership

Introduction

The ethical environment of a company’s leadership heavily impacts business decisions, and thus impacts the public’s image of the company. These decisions and the process by which they are made will affect the world’s view of the company, and it is important for company’s to understand the significance of ethical decision-making particularly in international business relations on the company’s reputation. AccuForm was a joint venture company, organized by the joining of CreaseFree, a Hong Kong OEM manufacturer of wrinkle-free clothing, and DynaCoat, a German coating’s producer. The two companies sought to develop high-tech coatings for the use on wrinkle-free clothing and fabrics for distribution throughout Asia. Because the two companies operated in different countries, they began the venture with obvious differences in corporate cultures. Throughout this analysis I will discuss the major issues raised by this joint venture. The major issues came about through the leadership and decisions made by that leadership. The major issues in the AccuForm joint venture were: (1) A lack of a joint ethical environment at AccuForm from the combining cultures of DynaCoat and CreaseFree; (2) The Laissez-Faire Management Style of Raymond Kim; and (3) lack of understanding of the Chinese culture, all of which resulted in bribery, fraud, and black market sells of inferior products.

Analysis

* What are the major social, ethical, legal challenges that AccuForm faces in operating a joint venture with R&D and manufacturing operations in China? How might the differences between the corporate cultures of CreaseFree and DynaCoat impact the joint venture?

* Analyze the role of top managers in the money-laundering scheme. Are top managers responsible