Question

QUESTION THREE Webster Chama joined the Zambia National Farmers Union as an Assistant Accountant three years ago. His immediate supervisor is the Chief Accountant, Mr. Michael Mulenga, who has worked for the Zambia National Farmers Union for fifteen years. Chama has noticed that huge amounts of money are being siphoned off by the top brass for dubious use. For instance the board has been meeting way in excess of the statutory requirement of at least four times but not exceeding six times' in a year. In addition to Board meetings, the Chairman of the Board is in the habit of 'dropping by to see how things are going' and drawing a sitting allowance every time he makes such visits. When Chama sought advice from his supervisor, he was told to mind his business or quit. Chama has now decided to report his bosses to the Daily Nation newspaper. What is the significance of Chama's behaviour in the strategic management of the company? (20 MARKS)

Answer 1

Chama's has noticed that his top management is not adhering to the statutory rules of the company. The board is meeting more than it should, money is being siphoned off for unknown uses and Chairman of the board is abusing his privilege of drawing a sitting allowance by visiting more often than needed. When Chama presented this information to his supervisor he was asked to ignore it indicating that perhaps the supervisor is also privy to the potentially illegal and definitely unethical actions. Chama pursued the right course of action by taking the matter to his supervisor, this is the usual norm when working in a business. However, the lack of adequate response from the supervisor have put Chama in a difficult position. Chama is now unsure of presenting the problem to anyone internal and instead wants to report the bosses to the newspaper. While whistle-blowing is a risky alternative, it can be the right one in cases such as these where there is no internal recourse to an employee. If Chama has a contact at a higher level than his supervisor, then he can present that person with the issue. This could however backfire if that person is also participating in the illegal activities. Most organisations have some form of internal reporting system where employees can report illegal or unethical operations that they have witnessed or noticed. In the absence of these, there is always the HR team that can be reached out to to understand the right approach to take to ensure the matter is brought to the notice of relevant stakeholders and resolved.

The actions of the top managers, chairman and board appear to be centered around self-gain where they are abusing the statutory guidelines for some self-interest. This is expressly prohibited in any business as it can negatively harm the business in terms of its reputation, resources and relationships. This behaviour is unethical and should be dealt with accordingly. Illegal and unethical actions such as these can also have social impact where it extends to or includes third parties such as vendors, suppliers, customers. A business and its top management must remain socially responsible to be able to conduct ethical business.

In reporting these actions to the press, Chama is passing on the information he has learned concerning wrongdoing within the company. He is exposing secret or classified information about the illegal or unethical workings of his management to an external source who can then investigate the allegations to verify their accuracy. This action can help the wrongdoing of the managers/board be exposed and all perpetrators held culpable. There can also be an adverse reaction to this action however, in that if found out Chama could be fired and be victimised by his company as whistleblowers are usually held in disdain by employees and stakeholders alike. Once the news of the wrongdoing comes to light, the company will also suffer a lot of negative publicity and scrutiny, and even legal action which can harm the non-guilty people within the company.