Business Ethics

By Shel Horowitz

If she donated $1,000 for a school to buy products, she would hit her million-dollar goal.

Mary Kantarian was achingly close to making her million-dollar sales goal — only $1,000 short. If she made the goal by the end of the year, it would mean a fat $10,000 bonus check, and a happy trip to the bank to finance a dream home she’d recently found. Other sales reps also were close, and one had already made the bonus. The books would close in just a few days, but at the end of the year her clients weren’t in a buying mood.

Still, Mary had one hope: inner-city Lincoln High School. Its students, who often had to share textbooks, could really use her company’s multimedia educational aids, but Lincoln had no discretionary budget for new teaching materials. What if Mary donated the money to this needy school for the purchase, and put herself over the magic quota?

Or perhaps she could offer partial “donations” to close sales at several schools. She would then surpass her quota goal with room to spare. The Lincoln school or other needy schools would gain immensely valuable educational programs that would help them serve their students, her company would pick up sales revenue, and she would meet her sales quota. Even better, she would earn a cool $10,000 on an investment of $1,000.

At first thought, this seemed like a win-win solution. But the idea needled Mary’s conscience. The more she thought about it, the more something about it bothered her. Yet if she didn’t close this “sale” — one which would help out disadvantaged students — she wouldn’t make that bonus, and her dream house would remain out of reach. She found herself wondering, What should she do?

Richard Burch, Adjunct Professor, Fairfield University Program
in Applied Ethics, Fairfield, Conn.

MARY SHOULD FIND BETTER WAYS to help Lincoln H.S. find the funds. Are there other corporate sponsors or community funds available? Could she pursue a school fund-raiser, or government grant? As an alternative, Mary could seek out more qualified prospects, or ask current customers to increase an order.

Trying to pull off the proposed “donation” scheme would be no easy task. Product donations usually have to be without strings. Cash gifts will buy what’s needed most, like textbooks, not multimedia aids. Also, school systems, like corporations, have formal purchasing procedures, including sign-off points in the purchase-order process that uncover kickbacks and bribes disguised as donations.

Each rep knew where the others stood. What would be their reactions when they found out Mary made her quota this way? And what if everyone did this? What would be the impact on the company, other sales people, and other schools that would want the same special consideration? And what good is a customer who next time around expects the same deal?

Aside from the possible consequences of this deal, Kant would remind us we should do the right thing for the right reason. Mary is under a moral obligation to act loyally and to protect the legitimate interests of her employer. She should act in the interests of those who depend on her, even if those interests aren’t always the same as her own.

What Actually Happened

Mary decided not to pursue offering Lincoln High School a donation. She wasn’t comfortable with the idea, and she knew that her sales manager and superiors all the way up the line would object, on both ethical and practical grounds. Mary didn’t make her bonus. But her reputation as a hard worker who maintains her integrity under pressure led to a promotion and higher pay two years later.

Shel Horowitz (shel@principledprofits.com) is author of Principled Profit: Marketing That Puts People First, and a Hadley, Mass., consultant in marketing who initiated the Business Ethics Pledge movement; www.principledprofits.com.

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