HR Ethics: Lee and Li Case
In this case, Dr. Chen got information from one client that one of the top officials in Lee and Li’s Attorney’s-at-Law firm had discovered an ambiguity and potential gap in the power of attorney. The client was SanDisk Corporation, and they realized that this loophole had enabled the senior assistant at the firm to trade the client’s stocks illegally before he proceeded to escape out of the country with a whooping NT$3 Billion. In a twist, the company had not anticipated such an ordeal and failed to secure insurance against embezzlement of funds. The management consisting of Dr. Chen and three remaining senior partners, has to devise a clever plan to salvage the company from collapsing in the vent that this information got out. Additionally, they need to watch out for the lawyers as well as the other employees. The prime consideration in this case is to protect the reputation of the firm within and without the country and prevent the potential fall out with the broad client base. This paper highlights the steps that need to be taken by the firm to mitigate the damage to the clients and protect the reputation of the firm. It also breaks down the approach Lee and Li should take in response to the embezzlement.
The approach taken by the firm should take four basic issues into consideration in the mitigation attempts: the parties that have been impacted by the larceny, the level of damage meted out to these parties, the actions that must be taken to guarantee the survival of the firm, and the measures to be taken in general to prevent such an occurrence. The assumptions are: the form does not have enough money to recompense the amount of money lost, legal action has already been taken to find the senior partner who facilitated this embezzlement and return the money, the relationship between the legal firm and SanDisk Corporation is still healthy and they have been allowed adequate time to recompense.
The firm should consider the immediate reimbursement of the lost funds in a single instalment. The first step is to make immediate contact with SanDisk and inform them of the situation. The senior management of the firm must take full responsibility of the situation and reassure the corporation that they will handle the case. Secondly, they must contact all their clients in a bid to maintain the strong relationships with them, prioritizing the clients with securities. They should move to assure the clients that the power of attorney does not include a clause that seeks to exploit them by giving too much power to the attorneys. The third step is to issue a public statement informing the public domain of the case. This is advantageous in the sense that it helps the firm to take full control of the situation and guide the manner in which information is relayed to the public. It ensures that unnecessary or rumored information does not make its way to the public. Moreover, it helps the company to gain respect from potential clients which is key in ensuring Lee and Li grows. Finally, the company must implement policy changes to prevent the occurrence of the same situation. They must make reforms and code a new strong policy against fraud. The management must develop a means of monitoring and reviewing the system.
In conclusion, the gravity of the matter at hand require the senior partners to act quickly and decisively. The right action to be taken is to repay SanDisk immediately in a single instalment. The benefits of this form of compensation for the embezzlement of the funds far outweigh the consequences. The only possible is that it will throw the company into a short-term financial situation in which they will operate under limited funds. Nevertheless, they would have saved the firm’s reputation. Additionally, this measure will have an overall positive influence on the clients as they would be reassured that their interests are protected.