Ethical Dilemma At Hudson's Bay

This case highlights the problems that chartered companies faced, in the last century. It details the actions taken by one such chartered company, Hudson’s Bay Company, to combat the employees’ private trade activities, as it impacted the companies’ revenues, and to manage these remote managers efficiently.
HBC introduced incentives and mechanisms to curb its employee’s private trade activities as it was not easy to determine, for the management in London, whether the number of furs/goods were less in a particular season due to private trade or low due to a bad harvesting season. Some of the actions taken were to pay their managers well with bonuses and gratuities. Ship captains were offered 20% of the value of the illegal traded goods when reported. Employment contracts were written with explicit penalty clauses
This also provided the men at Bay with opportunity to make additional money. The incoming and outgoing ships between London and the Bay were thoroughly searched to further reduce the private trade activities. Social structure was introduced where employees felt part of a larger family and this discouraged unethical practice of private trade.
Another secondary issue was managing the managers with slower communication in remote distances. These remote managers had to ensure that their staff adheres to the company policies such as conducting sober behaviour. In case of violations, the management in London gave these remote managers a benefit of the doubt that the workforce was not accustomed to the climate and the behaviour expected of them. Management in London started recruiting the workers from Scotland that were accustomed to the weather at the Bay. This move allowed the management to accurately measure the remote managers’