KATHMANDU UNIVERSITY SCHOOL OF MANAGEMENT

Getting things done effectively, efficiently

and ethically
Assignment 4
Name of the Instructor: Mr. Binod K. Shrestha

Course no.: (Business Environment)

Submitted by: Manaswi Shrestha (11309) MBA 3rd Trimester, 1st Year.

[13/01/2012]

How should this company be managed ethically while maintaining efficiency? Background: The ABC banking and finance company encounters several internal and external hassles in its tax clearing process. These problems are faced due to several weaknesses of both the government as well as the company. First, the company does not have any experts/responsible person to handle tax clearance. So, they are unaware of the precise set of documents that should be submitted during the process. Next, the forms are written in Nepal language and some words are difficult to comprehend. Also, the arrangement and the logistics of services and information are poor within the tax office. So, people who visit the office often get confused where they should go and what they should do. There is a huge communication gap between the tax office and the company; the changes taken place in tax policies are not conveyed. More importantly, the clearing process that is supposed to take only one day is elongated to 3-4 weeks. So, there is a waste of both time and personnel leading to higher opportunity loss. With the aforementioned intricacies, it can be seen that the degree of complexity and uncertainty is very high for tax clearance procedure. In order to shorten the procedure and reduce complexities, the company can make use of agents. However doing so, the company will be performing unethically although they are efficient. Then again, if they dont use agents and take 3-4 weeks to pay taxes, they will be unethical to their shareholders. In dealing with such ethical issues, managers are often faced with dilemmas that defy a simple choice between right and wrong. When there is no obvious way of prioritizing responsibility, and no precedent to emulate, resolution of such dilemmas demands careful consideration of stakeholder expectations when looking at the ethical options, so that decisions satisfy not only the immediate problem but also align with the organizations mission, values and ethical code. Recommendations: The finance company should first define what ethics means to them, whether it is being fair to shareholder or being fair to society.

Thus, the company is recommended to take the following steps: They should correspond regularly with tax department in order to update themselves with the alterations. Doing so, they can arrange all the documents required beforehand and can carry out the process smoothly. They should create and maintain a copy of thoroughly filled tax clearance form so that they do not have to waste time trying to understand the information asked each time they fill it. They can focus only on the latest changes made on the form. Other companies can also learn to do the same. This way, they will contribute to develop the civil foundation of the society. They should scan the periphery of the company to get updated with the ongoing issues and trends. Doing so, they can scrutinize the companys peripheral vision. Although using an agent would increase their efficiency, they should not use agents. They will pay lesser taxes and also make the other tax payers wait for a longer time. They will fall short in fulfilling their corporate social responsibility. Instead, they should strengthen their degree of power. If the managers build up their reputation and strengthen their relation with tax officers, they can get their jobs done more conveniently and faster. Thus, the managers should develop influential characteristic, which is not an unethical practice. Since bribing agents weakens the civil foundation of the society and ultimately lowers corporate social responsibility, the company should adopt the aforementioned recommendations to work ethically, effectively and efficiently.