This case is set in Sydney, Australia. Discount Drugstore is a major national provider of pharmacy and health related products that operates over 800 retail stores in Australia and has a revenue of over 7.2 billion Australian dollars. Discount Drugstore is one of many organizations that has an ethics policy statement intended to keep suppliers from using “gifts” to secure an unfair advantage with those involved in vendor selection; the policy includes provisions prohibiting travel and entertainment that might unfairly cultivate the bias of its employee product selectors.
Ryan Wilkie is the CEO and he has created a “golf culture” at the company where many corporate events are golf related. Every year Discount Drugstore holds a four-day charity golf event at the Royal Sydney Golf Club (a five-time Australian Open host). The annual charity event attracts numerous potential product suppliers, many of which are already Discount Drugstore (DD) vendors. Descriptions of this prestigious charity event suggest that it allows suppliers to liaison with DD employees in a manner normally “out-of-bounds” according to company rules.
Questions and Issues to Consider
Read the full case on page 81 in Ethics in Marketing: International Cases and Perspectives, 2nd ed. and then respond to the following issues.
In particular, is there a conflict between its business responsibility and the personal benefit that it receives both from the charity event and golf holidays?
A second ethical issue revolves around duties to stakeholders. One obvious stakeholder is the charity with which Discount Drugstore partners.
The charity appears to be receiving a much smaller percentage from the golf event than they should.
An over-riding ethical issue in the case is: Where does a gift end and a bribe begin?
The auctioned trips clearly present an ethical issue—are the suppliers ‘bribing’ the executives by taking them on these extravagant golf vacations?