Answer: The aforementioned case highlights ways in which a firm’s business practices are inextricably linked to both tangible and intangible aspects. In the given case, a telecom major finds itself grappling with allegations of questionable business practices, thereby threatening its reputation amongst both local and global markets.
(a) The challenges presented by the given situation are multi-fold ranging across both ethical and purely commercial aspects, including:

• Ethical business culture: An organization must rely upon strong commitment to ethical values and practices to further its objectives. Its pursuit of profit cannot enable it to compromise on ethical norms, as are prescribed both by convention as well as statutes of the land.
• Principle of fairness: Fair competition i.e. one based on quality, price, and service rather than unfair practices, is an essential condition for market economies to prosper. Use of unfair means is not just unethical but also illegal across geographies since it thwarts several benefits, especially redistribution of wealth and stifles innovation.
• Public trust: Because of the very nature of the company’s business, it has to contract with governments and with the public sector, including publicly owned entities. Therefore, the need to uphold ethics in business practices increases manifold, owing to public trust and money being involved.
• Shareholder value: Not only do unscrupulous activities erode public trust, they may also lead to a significant erosion of shareholder value. The company must be accountable to its shareholders for all its actions.
• Tarnishing India’s image: Such allegations not only affect the reputation of the concerned organization but also tarnish the image of the parent nation. It may also lead to flight of capital and colour investor perception about India as a business destination.

(b) The stakeholders in the given case include the following:

• Company’s European arm: Since the allegations emerge from a distant geography where the company conducts its operations and the local management and staff of the firm are primarily responsible for the same.
• Senior management of the parent firm: As key decision-makers, the company’s senior management and Board of Directors are directly responsible for any act of the firm.
• Local government and people: The government of the nation wherein the incident is alleged to have occurred must take necessary steps to ensure a fair and impartial destination to conduct business and punish the culprits if charges are proved. .
• Company’s Indian shareholders: The people who are directly invested in the firm have to be informed of any such malpractices or lack thereof, since their private wealth is involved.
• National media: Since the company is an Indian major, any such act(s) that may bring disrepute to the parent nation automatically becomes a topic of interest to the Indian citizens. The national media must keep the citizens abreast of all the developments which may take place.

(c) As the Chief Executive Officer (CEO), my course of action must be informed by a keen understanding of the challenges involved and choosing the most appropriate alternative that addresses them. It will include the following:

• I shall undertake a stocktaking of the situation, beginning with a detailed analysis of the business culture in the jurisdiction where this subsidiary operates.
• I would set in place a mechanism to ascertain, beyond reasonable doubt, the veracity of the allegations and to understand whether there appear to be any violation of the laws of the land.
• I would direct the company executives to proceed quickly yet carefully and avoid alerting any potential wrongdoers who are under investigation. The necessary information is to be collected through interviews and investigative evaluation of company documents and other sources, while protecting legal privilege at all times.
• When conducting this type of internal investigation, the concerns of the shareholders and the need to avoid lengthy, expensive, and possibly disruptive internal investigations has to be balanced. Therefore, I will rope in a third party investigative consultancy to ensure that the investigation remains fair and far from any doubt.
• The investigative firm would be entrusted with the following tasks:
  • to secure the company’s servers,
  • interview relevant employees,
  • conduct a forensic IT investigation for collection and preservation of all electronic evidence; and,
  • conduct background investigations and asset tracing of target subjects.
• If, at the conclusion of the internal investigation, there is evidence that links the executive and the third party, I would ask the General Counsel of the company to ascertain if the case pertains to commercial bribery or any such illegal act, as per the law of the land.
• If the act has been conducted against the law of the land, I would ensure that the firm self- reports the case to the local government. I will also hand over the detailed findings of the internal investigation alongside the requisite evidence.
• If the act is found to be in accordance with the local laws or a generally accepted business practice, I would ensure that the public relations and communications team conducts a global reach out campaign to present the findings of the report in a palatable format. The objective of this exercise would be to reverse any damage to the company’s reputation across all regions, especially where it operates.