Ethics Case
Gladys and the Narcissistic Knight
Chapter 1 – The Proposal
The room was still and quiet. On a desk next to a laptop computer, textbooks sat stacked, spines neatly aligned. Sunlight streamed through a break in the curtains, slowly moved across the room, and bathed the face of a sleeping young woman. When the golden light touched her face, Gladys Perkins’ eyes popped open. She yawned, stretched, and tried to remember why she felt so excited.
She smiled. “Of course. Today’s the day!” She jumped up and stood in front of the full-length mirror that hung on the wall opposite her bed. She turned her head left, then right, and peered closer at her face. “I don’t look any different.” But I am. Today is my first official day as Secretary/Treasurer for the Accounting Honorary Society. Wow. President of the IMA student group and now an officer in AHS. I impress myself. Gladys grinned then turned and went into the bathroom to get ready for school.
A few hours later, Gladys sat in large meeting room closely packed with other students. She looked down at the AHS meeting agenda. The new officers were listed next to their respective titles. David Knight, President, Lauren Smith, Vice President, Larry Washington, Activity/Service Director and me, Secretary/Treasurer. She smiled when she saw her name. She knew the other officers from her accounting classes and of course, Larry was also Vice President of the IMA Student Group.
She watched as David and Lauren move to the front of the room. Stop daydreaming, the meeting is starting.
David said, “Good afternoon everyone. I would like to call to order, the first meeting of the academic year for AHS. I am excited to kick off the new year as president of this fine organization. As you are probably aware, I was instrumental in helping this chapter attain Outstanding Chapter status last year. I plan to surpass past successes and make this year a truly exceptional year. I look forward to working with you all. Let’s get started.”
The room erupted in applause. David beamed, bowed slightly in acknowledgment and took his seat. “Please refer to the meeting agenda. We have a lot to discuss.”
The new president moved through the agenda items in an efficient manner. He smiled frequently and exchanged humorous remarks with student members. Gladys was struck by his bearing and charisma. He is so confident and eloquent. And he has a vision for AHS. I think he will be an excellent president.
David leaned forward to emphasize his next point. “Now we come to the proposal for the Ethics Awareness Program Development Grant. If you read through the materials I distributed, you realize this is a great opportunity. It is a national competition sponsored by the Institute of Management Accountants. Only four teams will be awarded grants. If we win a grant and complete our program successfully, the kudos would be a huge feather in my cap. And, of course, it would look fantastic for all of you as well.” David looked at Lauren and motioned for her to take over.
Lauren stood and said, “What we need to do today is brainstorm. We must put together a sound proposal—”
David raised his finger and interrupted, “An ambitious proposal. Something that will really stand out and get the grant committee’s attention.”
Lauren nodded and amended her statement, “Of course. We need to put together an impressive proposal and a corresponding budget. What we need are ideas. Suggestions for events. Also, scheduling, venues, and implementation. Once we’re in agreement, it will be up to our new secretary/treasurer to put together the formal proposal for submission.”
Gladys sat erect in her chair and tried to look confident. Her stomach fluttered and she bit her lip. This is it. My first big responsibility in my new role. Please, please don’t let me screw this up!
After the general meeting, the officers sat at a long table and reviewed the ideas for the proposal.
Larry said, “Wow. The meeting was really productive. We have about a dozen really good ideas for ethics awareness events. But we can’t include them all. We need to prioritize them then select the best ones for inclusion in our proposal.”
Lauren nodded. “Good idea. Let’s rank them starting with the best first.”
Gladys decided it was time for her to speak up. “Why don’t we go down the list, discuss each idea for a minute or two, and rank the top ones. I’ll keep notes.”
The team worked through the proposed ideas and she recorded the comments. When discussion was over, Gladys checked her list. Six events were ranked in the top category. She looked at the group and said, “There are still six event ideas on the list. We have cutting to do.”
David stood, stretched, then smiled at the others and spread his hands. “No, we have six excellent ideas. Put them all in the proposal.”
Lauren frowned. “David, you can’t be serious. Don’t forget. We have to actually implement this proposal. That’s way too many events to organize and schedule. We need to plan for three events at most.”
Larry said, “I agree. It will take a good deal of time to put together a campaign to promote each ethics awareness activity to ensure we meet attendance goals. Moreover, the publicity will pall after the first two or three events. People will lose interest in our program.”
Lauren looked at David and said, “Maybe we could propose four?”
Gladys cleared her throat. I agree with Larry and Lauren. I think it would be better to propose fewer events and do a really fantastic job implementing them.”
With a dismissive glance at Gladys, David turned to the rest of the group. “Look, we have to win a grant first. And the only way we can win is to submit an ambitious program of events and a well-justified budget to match. We need to put all of the good ideas in the proposal.”
Larry shook his head, “Six is just too many. If we fail to pull it off, it will make us look bad.”
David spread his hands and smiled, “Oh, come on guys. We can do this!”
No one said anything for a few moments. Finally, Larry said, “Well I suppose…”
Lauren looked concerned, but said, “I think we could propose four. Larry? Gladys?”
Larry gave the thumbs up. Gladys nodded and said, “I will do my best to put together a good proposal.”
David grinned. “I am sure Gladys will make us proud.”
After the others had left the room, David approached Gladys, put his hand on her shoulder, and said, “Put all the top events into the proposal. Then pad the budget a bit to ensure we have more than sufficient funds to carry off the plan in stellar fashion.”
“But David …”
He looked directly into her eyes, “Look. We are a small school up against extremely stiff competition. Our organization needs this award. You know as well as I do that we have to submit an impressive proposal to win a grant. A bit of ambitious padding is expected. It’s the way the game is played. The grant committee will take it into account.” He gave her a charming smile. “Don’t let me down.”
Gladys watched him go with a sinking feeling in her stomach.
Chapter 2 – The Program
Gladys entered the meeting room and quickly took her seat. David Knight stood behind a podium in front of a classroom filled with student members and faculty. “Fantastic news! Thanks to Gladys Perkins’ proposal draft, and with a little editing on my part…” He paused then flashed a brief smile and spread his hands. “We won. We received an Ethics Awareness Program Development grant.” His audience clapped with enthusiasm.
Dr. Mary Jacobs, faculty adviser for AHS, said, “Congratulations. Your proposal was nicely done, albeit quite ambitious. You have a massive amount of work to do to implement your plan successfully. I will be available to offer assistance when needed. My door is always open.”
Lauren and Larry looked at Gladys and frowned. They look perturbed. What’s going on? Concerned, she quickly glanced through the package David had distributed. It contained the letter from the grant committee and a copy of the finalized proposal. She gasped. This proposal is not the one I prepared. The plan proposed six ethics awareness events instead of the four the group had agreed upon. The projected budget was substantially higher than what she had estimated. Her stomach lurched and her mind buzzed. She stared at David in disbelief.
He smiled at Professor Jacobs and said, “Thank you, Mary. I appreciate your contributions, as always.”
Lauren turned and added, “Thank you, Dr. Jacobs, we would appreciate any help you can provide.”
Brow furrowed, Larry glanced at Gladys. With a weak smile, he said, “Yeah, we can use all the help we can get.”
The meeting ended and as the student members filed out, Gladys sat still, posture stiff, with a dazed look on her face. Lauren and Larry approached and looked down at her. Larry said, “I thought we agreed on four events. Why did you include six?”
Still shocked, Gladys stammered. “But…but I didn’t. I…” With a look of disapproval, Lauren turned and walked away. Larry shook his head and followed.
After the others left, Gladys turned to David. “You changed my proposal. You put in all six events after the group agreed to four. Then you padded the budget numbers. Lauren and Larry obviously were upset. They think I went against the group.”
With a voice full of pity, David said, “I edited my proposal and won the grant for AHS. The proposal you prepared was uninspiring. It would have been rejected. What’s the problem? I made us look good. I made you look good.”
Gladys shook her head, “David, we will never be able to implement successfully. It will take too much work to do a good job. Can we submit a revised proposal?”
David snorted. “Are you kidding? They will revoke the grant and give it to someone else. No, we will implement the plan as proposed.” He touched her arm and smiled. “It’s going to be wonderful. I have every confidence that our program will succeed. You, Lauren, and Larry need to get started right away.”
He walked across the room towards the door, paused and winked at Gladys over his shoulder. “Don’t let me down, kiddo.”
Six months later, the four AHS officers sat around a table in a small conference room. Gladys distributed a handout to the other officers. She sighed and said, “As you can see, our ethics awareness program was not as successful as we hoped. In summary, three events went quite well and actually exceeded attendance expectations. However, one event was canceled. The other two were implemented, but resulted in low attendance and poor feedback.”
David frowned at Gladys, “We had a fantastic plan. What happened? What did you do?”
Lauren looked up from the report and spoke up in Gladys’ defense, “This isn’t her fault. You revised the proposal. The plan was too ambitious. It’s that simple.”
David turned and glared at Lauren.
In a placating tone, Larry said, “We had difficulties scheduling speakers, reserving good venues, and promoting the program. We got behind and had to arrange four of the six events during the spring semester. There were a number of competing activities that cannibalized our attendance, and interest always wanes towards the end of the academic year.”
No one spoke for a few moments then Gladys said, “I am afraid there is more bad news. In addition, to the canceled event and attendance issues, the funds we were given were not spent as indicated in the proposal. We will have to explain that in our final report as well.”
Lauren nodded, “We need to carefully report our successes and failures. Explain what went wrong and why it went wrong.”
With an abrupt gesture, David dismissed Lauren’s comment. “That will make us look incompetent. We need to carefully construct a report that highlights the program’s successes and camouflages the program’s failures. What we need is a positive report that portrays what happened as a ‘highly constructive learning experience’.”
Larry frowned, “But I don’t think—”
“Are you suggesting we inflate our performance?” asked Gladys.
David said, “No, of course not. I am suggesting that we use careful direction and language to construct a positive report and avoid damaging the reputation of AHS. This chapter attained Outstanding Chapter status last year, and I have no intention of marring my achievement.”
In a muted voice, Gladys said, “I am not sure I am comfortable with …”
David glanced down at Gladys with a condescending smirk and slight shake of his head, “Don’t be so naïve, Gladys. This is the way business operates. We will not be falsifying performance results. We will be reporting what happened. Just giving it a constructive spin. It’s called rhetoric. All businesses use rhetoric to polish up their annual reports. You’ll learn.” He spread his hands wide in an affected gesture, “Think of it as marketing.”
Gladys glanced at the other two members of the team. Lauren lowered her eyes and looked down at her lap. Larry shrugged.
David turned to Gladys, “Good. I will expect a favorable program report by the end of the week.”
Chapter 3 – The Report
Two weeks after Gladys submitted her report to David, she accessed her email. Included with several other messages was one from the IMA. It was directed to David Knight with copies to her, Lauren, and Larry. Gladys held her breath, looked up at the heavens and crossed her fingers, then opened the message. She read the body of email aloud to herself, “Thank you for a most thorough and professional report on your Ethics Awareness Program Development efforts. On behalf of the IMA, I would like to congratulate the AHS on the unqualified success of the implemented program. We look forward to announcing your group’s impressive accomplishment at the upcoming IMA Annual Conference and Expo.”
Gladys sat erect in her chair and stared at the computer screen. She reread the email, “Unqualified success? Impressive accomplishment?” I don’t understand. Did they read my report? She stared into space for a moment then closed her eyes. Oh, my God. He didn’t …
Heart pounding, she logged on to the AHS website, accessed the proper folder, and downloaded the published document. As she read, a knot formed in her stomach and her panic grew. The eloquent verbiage boasted of the successful implementation of six events. This is not my report. David submitted his version under my name. She rubbed the back of her neck and continued to read. The three events that had gone well were accurately reported, but attendance results and participant feedback for the other two events had been substantially inflated. Moreover, the cancelled event did not even appear on the report. It had been replaced by an event that had been hosted by the Center for Ethics. AHS members attended the event, yes, but we did not host that event. Oh no. David took credit for an event we didn’t’ even host.
Gladys put her head in her hands. This is unbelievable. I can’t be a party to this. What should I do? If I report this to the IMA…? Oh, my God… my name is on the report! What am I going to do?
DISCUSSION QUESTIONS
2. IMA members (including student members) are bound by the IMA Statement of Ethical Professional Practice (IMA SEPP). Consider the progression of the ethical situation in which Gladys is involved. Reflect on the issues with which Gladys’ is confronted in light of the IMA SEPP and respond to the following:
a. Identify the first ethical issue with which Gladys is confronted. Explain the ethical dilemma and the players impacted by the issue. Did Gladys handle this situation ethically? Explain. What actions could she have taken at this point to avoid future issues?
b. Identify the IMA SEPP principles/standards that apply to Gladys’ situation. Discuss Gladys’ actions/options as the situation evolves in light of the identified principles/standards. Explain the risks of such actions/options.
c. David’s “ambitious” plan evolved into an inflated report that put Gladys in a difficult position. If Gladys fails to act in response to the report, will she be in violation of the IMA SEPP? Explain. If Gladys fails to act and the issue is discovered, will she be held responsible even though David changed her report? Discuss.
d. Imagine you are Gladys and consider how you would respond to the inflated report. Write an ending to the case that clearly portrays your advocated course of action for Gladys, the risks involved, and the ultimate impacts on the players (include actions, dialogue, and/or internal thoughts as appropriate).
3. Envision yourself in a similar situation in a real-world business setting. Discuss appropriate ways to deal with a narcissistic leader such as David in a constructive manner consistent with professional standards. How might such actions mitigate the risk of ending up in a situation similar to the one Gladys faced?