Introduction to the Case
One of the most challenging and interesting areas of moral reasoning involves deciding where to draw the line between permissible and impermissible actions. Even if we know that some actions are clearly right and others are clearly wrong, there may be gray areas where making decisions is difficult.
Deciding when to accept a gift or amenity illustrates this challenge. This case is developed from the experiences of a chemical engineer.
As engineers, you can expect to be given responsibilities that exceed those of non-professionals. This reflects the respect which your professional knowledge commands in the workplace. It also means that your favor will be courted by vendors and others who can benefit from your goodwill.
This goodwill is often sought by means of gifts and amenities of various sorts. Sometimes accepting these gifts and amenities may be a proper part of a business relationship. In some situations, however, accepting them may be a serious breach of business and professional ethics, and perhaps even a violation of the law. Drawing the line between proper and improper acceptance of gifts and amenities may be the first issue in professional ethics that engineers face.
The issue of gift giving is troublesome because the line between the legitimate acceptance of a gift or amenity and taking a bribe is often not easy to draw. It is for this reason that many companies and governmental agencies have come up with rules to guide employees in the treacherous terrain of accepting gifts and amenities.
For example, this is a partial list of gifts which a large electronics firm considers it improper for engineers to accept:
- door prizes at a conference
- raffle prize by a supplier or distributor
- any gift of excessive value (supervisor must be notified)
- fare lower than commercially available
- cash rebates
- tickets to sporting events or other entertainment given as an outright gift (where the supplier does not intend to accompany the employee)
- sports team sponsorship by supplier
- extravagant dinner or entertainment
- any gift, favor, hospitality or entertainment that could in any way create a feeling of obligation or could compromise professional judgement.
The mere fact that a corporation makes the effort to construct such a list indicates the importance that it ascribes to proper conduct in this area.
The codes of many large corporations also furnish policies for accepting favors. Here are a few examples:
"It is a serious violation of our Standards for anyone to seek a competitive advantage through the use of gifts, gratuities, entertainment, or other favors. Under no circumstances may we offer or give anything to a customer or a customer's representative in an effort to influence a contract award or other favorable customer action. It has been and will continue to be General Dynamics' policy to compete solely on the merits of its products and services." [General Dynamics]
"Staff members and their families may not solicit or accept any gifts of significant value, lavish entertainment, or other valuable benefits intended to influence Chase's business. Staff members may not solicit or accept personal fees, commissions, or other forms of remuneration because of any transactions or business involving Chase." [Chase Manhattan Corp.]
"Employees will give no gifts to customers except items of nominal value which fit the legal, normal, and customary pattern of the Corporation's sales efforts for a particular market." [R. J. Reynolds Industries]
"With the exception of reasonable business entertainment and other activities permitted in accordance with the following paragraph, no employee of the Company shall give or transfer anything of value to or for the benefit, directly or indirectly, of the employee or agent of another person, including any customer, union representative, or supplier.... Reasonable business entertainment would cover, for example, a lunch, dinner, or occasional athletic or cultural event; gifts of nominal value ($25 or less); entertainment at Pleasantdale Farm or other Company facilities; or authorized transportation in Company vehicles or aircraft. In addition, reasonable business entertainment covers traditional Company-sponsored promotional events." [Allied Chemical Corp.]
"No IBM employee, or any member of his or her immediate family, can accept gratuities or gifts of money from a supplier, customer, or anyone in a business relationship. Nor can they accept a gift or consideration that could be perceived as having been offered because of the business relationship. "Perceived" simply means this: If you read about it in your local newspaper, would you wonder whether the gift just might have something to do with a business relationship? No IBM employee can give money or a gift of significant value to a supplier if it could reasonably be viewed as being done to gain a business advantage. If you are offered money or a gift of some value by a supplier or if one arrives at your home or office, let your manager know about it immediately. If the gift is perishable, your manager will arrange to donate it to a local charitable organization. Otherwise, it should be returned to the supplier. Whatever the circumstances, you or your manager should write the supplier a letter, explaining IBM's guidelines on the subject of gifts and gratuities. Of course, it is an accepted practice to talk business over a meal. So it is perfectly all right to occasionally allow a supplier or customer to pick up the check. Similarly, it frequently is necessary for a supplier, including IBM, to provide education and executive briefings for customers. It's all right to accept or provide some services in connection with this kind of activity — services such as transportation, food, or lodging. For instance, transportation in IBM or supplier planes to and from company locations, and lodging and food at company facilities are all right." [IBM]
"It is TI policy that TIers may not give or accept any gift that might appear to improperly influence a business relationship or decision. If we receive any substantial gift or favor, it must be returned and our supervisor notified. This policy does not apply to items of small value commonly exchanged in business relationships, but even here, discretion and common sense should be our guide. In commercial business, the exchange of social amenities between suppliers, customers, and TIers is acceptable when reasonably based on a clear business purpose and within the bounds of good taste. Excessive entertainment of any sort is not acceptable. Conferences accompanied by a meal with suppliers or customers are often necessary and desirable. Whenever appropriate, these meals should be on a reciprocal basis." [Texas Instruments]
The topic of bribery has a long history, and bribery seems to be an area in which our moral views are changing. For this reason, a short history lesson may be instructive.
John T. Noonan, a lawyer and historian of moral ideas, traces the history of thought on bribery from 3000 B.C. to the present. He finds that moral concepts change: "Moral concepts found enshrined in traditions do not stay the same. They undergo transformation. They are subject to investigation and criticism. They expand, shrink, or disappear.1
This thesis can be illustrated by comparing the history of the concept of bribery with the history of other moral ideas. Until about the sixteenth century, it was considered wrong to take interest on money, and "usury" was a serious sin. It still is in Islamic countries, which have preserved the old prohibition. Due to a number of circumstances that we cannot discuss here, the prohibition against taking interest on money was lifted in the West. Today, the term "usury" is reserved for the extraction of excessive interest.
By contrast, slavery and torture were widely accepted in Western society until the eighteenth century, and now both are condemned as heinous evils.
What is the trend with regard to the concept of bribery? Is the idea likely to remain vigorous and even expand its dominance, so that more and more types of behavior will be condemned as contrary to the anti-bribery ethic? Or is it likely to shrink and wither as a moral concept? Is bribery becoming increasingly tolerated (thus following the pattern of usury), or is it increasingly frowned upon and prohibited, as has been the case with slavery and torture?
Noonan believes the evidence shows that bribery is increasingly viewed with intolerance throughout the world. In fact, in virtually every country in the world, bribery is a shameful act. Those who accept bribes do not speak publicly of their bribes anywhere. Noonan claims that only the Westerner supposes that a modern Asian or African society does not regard the act of bribery as shameful in the way Westerners regard it.2
There are good moral reasons for this increasing intolerance, especially as the capitalist system becomes more widely accepted:
- Bribery corrupts the capitalist economic system. The capitalist system is based on competition in an open and free market, where people tend to buy the best product at the best price. Bribery corrupts the free-market mechanism by getting people to make purchases that do not reward the most efficient producer.
- Bribery is a sellout to the rich. In any situation ruled only by money, the deeper pockets will prevail. If bribery were universally practiced, expert testimony, justice in the courts, and everything else would be up for sale to the highest bidder.
- Bribery produces cynicism and a general distrust of institutions. It destroys people's trust in the integrity of professional services, of government and the courts, of law enforcement, of religion, and anything it touches. There is good evidence that societies which allow bribery tend to have social unrest and perhaps revolutions.
- Bribery treats people as commodities whose honor can be bought and sold. It thus tends to degrade the respect we owe to other human beings.
The Method of Casuistry
Even if we agree that bribery is wrong, there is still a problem of determining what is and isn't a bribe, and when an action is close enough to a bribe to be morally out of bounds. Where, in other words, do we draw the line?
One way of dealing with this question is through the method of casuistry. This method has a long history, going back to classical times, but it has recently been revived in medical ethics. It also has a background in common law. In common law a judge decides a case by comparing it with the way previous judges have decided similar cases in the past. Her reasoning involves citing analogies and disanalogies between past cases and the present one. If the analogies seem more important than the disanalogies, she decides the case in a way similar to the way the earlier judge decided the case. If the disanalogies seem to be more important, then she decides the case in a different way.
How does this method work? Let us consider an example. Most people would probably agree to a moral rule which could be stated in the following form: "People should not steal (or commit theft)." Breaking into a store at night and taking several thousand dollars worth of merchandise would be a clear violation of the rule. We could say the same thing of shoplifting, or "borrowing" a friend's car and failing to return it, or taking a bicycle that someone had forgotten to lock. By contrast, it would seem peculiar to say that picking up a quarter on the street is an instance of theft. The same would go for failing to return a sheet of paper or a paper clip someone had given to you. We probably would not say that an engineer-manager was guilty of theft because he used some management techniques that he had developed while working for his old employer.
Some situations, however, are more problematic. It is not always easy to determine whether a particular action should count as "stealing" (or "theft"). What would we say about an engineer who helped to develop a new chemical process at Company A and then moved to Company B, where she used some of the same ideas, but applied them in a very different way to a different process? What would we say about an engineer who developed a computer program on company time for his company, and then patented a considerably improved version under his own name? What about borrowing a book from a friend, forgetting about it and then deciding not to return it because the friend has left town?
Examples such as this could be arranged in a series, beginning with clear examples of "stealing" (or "theft"), then moving into more problematic examples, and finally moving to examples which we would not consider to be instances of "stealing" (or "theft") at all. Such a series might look like this:
Moral rule: "People should not steal (or commit theft)."
- Breaking into a store and taking $3000 in merchandise.
- Borrowing" a friend's car and failing to return it.
- Taking a bicycle that someone had forgotten to lock.
- Developing a computer program on company time for your company, and then patenting a considerably improved version of the program under your own name.
- Borrowing a book from a friend, keeping it by mistake for a long time and then failing to return it. (You discover the book after your friend has moved away, and you decide to keep it.)
- Using some ideas you developed at Company A for a very different chemical process at Company B.
- Using some management techniques at Company B that were developed at Company A.
- Picking up a quarter that you saw someone drop on the street.
- Failing to return a sheet of paper (or paper clip) you borrowed.
- Picking up a quarter that someone (you don't know who) has dropped on the street.
There would be virtually universal agreement that examples 1–3 are examples of theft. There would be virtually universal agreement that examples 9 and 10 are not examples of theft. There might be disagreement about examples 4 through 8. Probably most people would consider example 4 a type of theft. Example 5 is something many of us have done. We might say that the action is justified, because the expense and trouble to us of returning the book is probably greater than the value of the book to our friend. This might be especially true if we knew the book was old and out of date. We would probably resist the use of the work "theft" to describe our action. Examples 6 and 7 might be considered less clear examples of theft than example 8, except for the potentially large amount of money involved in these two examples.
One of the considerations that makes the determination of what is and is not theft so difficult is that there is no single criterion that can be used to decide the issue. The most obvious such criterion is the monetary value of the property in question. But this criterion will not always work. Snatching a dollar bill from an old lady is more clearly an example of theft than using an idea one developed at Company A for a very different application at Company B, even though the latter example involves vastly greater sums of money than the first. A variety of considerations are relevant, monetary value being only one.
Similar consideration can be applied to bribery, We all agree that accepting bribes is a violation of professional ethics, but we may not always find it easy to determine just what is and is not a bribe. Certainly not all examples of accepting gifts and amenities qualify as accepting bribes, just as not all cases of taking another's property should be considered theft. Determining when a rule against taking bribes is being violated requires common sense, discrimination, and powers of moral deliberation.
1. Noonan, John T., Jr. Bribes. New York: Macmillan, 1984. p. 683.
2. Noonan, p. 703.
In spite of the attempts of many companies to provide rules in this area, you will find that there are many situations which are not covered by the rules. The set of cases presented illustrates the transition from a case of accepting a favor that almost anyone would find permissible to a case of accepting a favor that almost anyone would find impermissible. In between are cases which will provoke more thought and discussion.
First installment of the case
Tom was named the department manager of a large new chemical process unit that was to be designed and then constructed. Tom's responsibilities were to form the process unit staff; look over the designer's shoulders to ensure the plant was designed to be safe, operable, and maintainable; and then start up the plant after construction.
During his previous experience, tom had noticed that a new type of valve and valve operator could often be used in place of more common gate valves and their operators. In every case the new valve was less expensive, and it often gave a tighter shutoff than the gate valve. Tom convinced the project designer to add even more of these valves and operators to the design. The result was an improvement in safety, because more flows could be shut off more quickly in an emergency.
After a large number of values have been specified and purchased, the salesman for the valves (Jim) visits tom and gives him a plastic pen with the name of Jim's company stamped in gold. The pen is worth about $5.
Should Tom accept the pen?
After a large number of valves had been specified and purchased, jim invites tom to play golf with him at the local country club. Tom is an avid golfer and has wanted to play golf at the country club for some time — it is the best course in town.
Should Tom accept the invitation?
After a large number of valves have been specified and purchased, Jim offers to sponsor Tom for membership in the local country club.
Tom is an avid golfer and has wanted to be a member of the club for some time, but has not found a sponsor.
Should Tom accept Jim's offer?
After a large number of valves have been specified and purchased, Jim invites Tom to a seminar on valves to be held in south america. There will also be opportunities for fishing and recreation. Tom's company would have to pay for transportation, but Jim's company will cover all the expenses in South America. Tom is sure his manager will authorize the trip if asked, but other managers in the firm, when placed in an equivalent situation, feel uneasy about these types of offers.
Should Tom ask his manager for the authorization to take this trip?
After a large number of valves have been specified and purchased, jim invites tom on a very nice fishing trip to South America. Jim's company will cover all the expenses. Tom is sure his manager will authorize the trip if asked, but other managers in the firm, when placed in an equivalent situation, feel uneasy about these types of offers.
Should Tom ask his manager for authorization to take the trip?
Before Tom's decision to recommend any type of valve, Jim visits and offers Tom a very nice fishing trip to South America if Tom will recommend Jim's company's valves. Jim's valves are the safest and least expensive.
What should Tom do?
Before Tom's decision to recommend any type of valve, Jim visits Tom and offers him a very nice fishing trip to South America, if Tom will recommend the valve produced by Jim's company. Jim's valves are less safe and more expensive than other types of valves.
What should Tom do?
After the plant is constructed, Tom and Jim become very good friends and socialize on many occasions. They and their wives visit each other in their homes and in their lakehouses. They also go fishing on each other's boats. Even after Tom leaves the original plant, he remains good friends with Jim.
Tom is then invited to fly in Jim's plane to mexico for a white wing dove hunt. Tom never did anything to help Jim and his company, other than his initial recommendation of the valves.
Should Tom accept the invitation?
Carson, Thomas L. "Bribery and Implicit Arguments." Journal of Business Ethics. Vol. 6. pp. 123–125 and pp. 361–364.
A philosophical discussion of the moral status of bribes and bribery.
Christiansen, Donald. "Spectral Lines: Ethical Judgements."IEEE Spectrum. 26:2 (Feb. 1989), p. 25.
-----. "Spectral Lines: Ethical Dilemmas Revisited." IEEE Spectrum. 26:4 (April 1989), p 21.
A series of gift-giving cases which asked the readers of IEEE Spectrum to reply with their solutions. An interesting interplay between professional engineers.
"Cornerstone 1: Understanding Ethics in the Business of TI." Dallas, Texas: Texas Instruments Ethics Office, n.d.
"Cornerstone 2: Gifts, Travel, Entertainment...and TI Ethics." Dallas, Texas: Texas Instruments Ethics Office, 1989.
Both of the previous references are taken from pamphlets given to every TI employee. They serve as quick references on ethical issues. These two deal with the employee/vendor relationship.
"Ethics in the Business of TI." Dallas, Texas: Texas Instruments Publishers, 1990 rev.
The TI employee manual describing the corporate ethical policies.
"Forum: Letters to the Editor: Getting Down to Cases." IEEE Spectrum. 26:5 (May 1989), p. 10.
A series of gift-giving cases which were made up by the editors. The editors then asked for feedback from their readers on what they would do in the given situations.
Jonsen, Albert R. and Toulmin, Stephen. The Abuse of Casuistry. Berkeley: University of California Press, 1988.
A philosophical study of the method of casuistry.
Longnecker, Justin C. "The Ethical Issues of International Bribery." Journal of Business Ethics. Vol. (1988), pp. 341–346.
Argues that the maxim, "Do as the Romans do," is not a good guide in the area of international bribery.
Noonan, John T., Jr. Bribes. New York: MacMillan, 1984.
A masterly historical survey of bribery.
Skooglund, Carl. "Unacceptable Gifts and Favors." News.Archives, a TI online system. Dallas, Texas: Oct. 16, 1989.
The Texas Instruments corporate ethicist discusses TI policy regarding gift-giving.