Bright Pharmaceuticals, Case Study Example

Bright Pharmaceuticals provides an illustrative case study in as far as ethical considerations are concerned. On this case, the three managers find themselves in a difficult situation in making an ethical decision. As leaders of the company, they have an obligation of reaching informed decisions to make the company profitable. Currently, the company’s performance indicates it is likely to cease operations. Considering the market is proving difficult in the fourth quarter, it is inevitable to avoid a loss by the end of the financial year in 2012. This unfortunate occurrence implies that managers are not eligible for bonuses because the company will have no dividends.

Numerous parties to this case would be affected by the company’s losses or profits. The first party is the shareholder. With a looming loss for the company, the shareholders are likely to miss the dividends as the company will not earn any. For the managers, they would be affected if the company makes profits or losses. The CEO, the marketing manager, and the financial managers would receive bonuses for any profits made. On the other hand, loses for the company would imply that the three would not be eligible for bonuses at the end of the financial year.

The managers are expected to draw several alternatives presented for this case. The first option would be that of allowing the company to record loses. Secondly, they can introduce an imminent increase in the prices of products. This would reduce demand and result in the closing of the revenue gaps, and avoid making of loses by the end of the financial year. Thirdly, they can interfere with the financial records through making records of shipments as sales, to cover up the profits made through induced demand.

From all these alternatives, I would choose not to make any interventions, but rather settle on making clear financial reports with the incurred losses. Whereas this decision may appear to be exposing different players into making of losses, it paints the perfect picture of the company and avoids chances of financial trouble in the preceding financial year. This form of development is primarily meant to convey some sense of responsibility, transparency, and accountability in the company. For the option that calls for the announcement of imminent price increase of the company’s products, it may be forced to announce the cancellation of such plans. This would allow the company back to its position as consumers would reduce their expenditures and instead use up their stocked products. This would not allow a long-term solution on the poor sales recorded by the company. Similarly, taking this choice may have a reluctant board rejecting any moves to invest further in new ventures. On shipping, the balance of books in the next financial year would have greater discrepancies, which would leave my career as the financial manager at risk.