Ethical Reveiw of Lockheed Deal

Carl Kotchian's decision in the Lockheed, Japan business contract was the right decision. Bribes were big part of Japanese business in the 1970's. By accepting the deal, Kotchian provided jobs for thousands of employees for the Lockheed Company. The deal also took care of the Lockheed shareholders, and their families. Conducting business globally in the 1970's sometimes meant paying bribes, or kickbacks to guarantee the deal.

Although bribery was not an accepted practice in the 1970's within the United States, bribery was an important factor in the global marketplace. Paying out bribes sometimes meant the difference between landing a deal and watching your competitor get the deal. Carl Kotchian followed the rules of a functioning system that was in place when it came time to do business on a global scale. At the time of his deal, no laws were in place prohibiting any forms of bribery. Therefore legally speaking, no laws were broken to create this deal. The decision to take part in paying the bribes to the Japanese politician was not illegal; bribes were an important factor in many Lockheed international business deals during the 1970's. The economic impact for Lockheed was gigantic. At the time of this deal Lockheed needed contracts; the company was headed towards bankruptcy; only avoiding bankruptcy by getting a loan from the U.S. government. If Lockheed was able to land the deal with the Japanese, revenues of $400 million would be seen. With these types of revenues, the entire company of Lockheed would be saved by the Japanese deal. The economic ramifications of the bribes had little to play, with a total of $12 million paid in bribes by the end. That amount of the bribes was a mere three percent of the entire revenue Lockheed would see. Economically this deal secured the future of Lockheed doing business in Japan. Since Japan's market was the last untapped market in the world.

In this case, Kotchian is face with many challenging moral issues. Kotchian's biggest moral dilemma was paying the bribes and kickbacks to the Japanese politicians. But, Carl Kotchian was simply doing business in a market where he did not understand the rules. Kotchian did not offer the bribes to seal the deal; he was told if he wanted the deal he had to pay bribes. Kotchian only followed the rules of the system in which this deal took place. Outside the United States bribery was a common global practice in the 1970s. By paying these bribes, Kotchian secured thousands of jobs, and the financial security of those families, and shareholders. Kotchian played by the rules of a system that functioned on bribes, and did what any good business executive in that time