Siemens case study Example | Topics and Well Written Essays - 2000 words

Siemens - Case Study Example It is the commitment of companies, especially those that have a significant influence on the international market that ensures that efficiency is maintained. Efficiency is integral not only when it comes to using minimum resources to fulfill maximum needs, but is also pivotal when it comes to allocation of resources and their eventual distribution. In other words, the basic economic problem is seen to have its solutions within the confines of efficiency, and it is advantageous for the members of the world of commerce to ensure that the equilibrium of efficiency is maintained, both locally and internationally. Multinationals companies are seen as increasingly responsible for maintaining the equilibrium that would benefit all since their increased market share gives them greater influence in the arena of buying and selling. This is one reason why the use of bribes is heavily frowned upon by the international markets, especially when large multinational firms are involved. The use of br ibes is an act that disturbs the equilibrium of free trade, since they influence the decision power of individuals, prejudicing it to fall in the favor of the one offering bribes. Siemens, being one such multinational firm that possessed significant share of the global market was caught in the hurricane of media attention, international scrutiny and internal ratification policies when fraudulent actions were seen to be prevalent within the company. The Siemens executives were accused of paying six million Euros to another company in order to achieve the gas turbine contract in Italy. The accusation involved that the executives used the company funds to influence the decision of others. This accusation attracted the attention of the international media since it involved the transaction of such a large amount of money. Moreover, the reputation of one of the world’s largest companies was at stake. As a company that complies and abides by the restrictions and regulations of the f ree market, the bribe was seen as an act that harms the spirit of competition and free trade in the global market. Thus, Siemens was seen as the perpetual deviant of the global market. Subsequently, the fact that a multinational company such as Siemens is involved in financial embezzling had a negative impact on the brand. The executives accused of the embezzling were Andreas Kley and Horst Vigener. While they agreed that the transfer of six million Euros from Siemens to Enel did occur under their authorization, they defended their actions. These former managers said that their actions cannot be classified as an act of fraud since the financial transaction between Siemens and Enel was made solely and purely for the benefit of Siemens the company. They claimed that a bribe is an act that ensures personal gain, and signifies corruption that is intended to harm the company. However, their decision to transfer the amount to Enel was not for their own gain. Siemens would have gained imme nsely if the contract for the gas turbine had been awarded to them, and the managers were aware of this. The company hoped to earn 90 million Euros in addition to a firm footage in the Italian market. Thus, Siemens’ funds were not used to benefit anyone else, except Siemens the entity itself. Since neither employee benefitted personally from the funds transferred, both Kley and Vigener testified that they were innocent. The defenses they presented were to an extent