And It All Started with a Car Wash: Layers of Corruption in the Petrobras Scheme

Case number : 9 100 2022 003
Case published in the International Journal of Case Studies in Management, Vol. 20, No. 2
Date :  2022-05-10
Teaching notes included :  Yes
Abstract

Petrobras is a multinational oil and gas company publicly traded in Brazil and international stock markets including the New York Stock Exchange. The company’s controlling shareholder is Brazil’s federal government. Political influence was at the centre of Petrobras’s participation in a massive corruption scheme revealed in 2014. Brazil’s Federal Police launched Operation Car Wash, a series of investigations disclosing a wide-ranging corruption scheme involving Petrobras, many politicians, and the country’s leading construction firms.

The case focuses on how corruption spread at Petrobras and the company’s responses to the crisis beginning in March 2014.

Teaching objectives
  • Identify various corrupt practices in organizations, including bribery, fraud, and bid rigging
  • Analyze organizational corruption as an umbrella concept including various corrupt practices such as bribery, fraud, and bid rigging
  • Discuss the advantages and disadvantages of different governance structures in relation to corruption
  • Examine management practices adopted in response to a legitimacy crisis related to corrupt practices
  • Evaluate the assumptions underlying an organization’s actions in response to a legitimacy crisis
  • Propose alternative organizational approaches to responding to a corruption scandal.
Primary domain :  Business ethics  - Governance
Secondary domain :  Not available
Sectors :  Energy and raw materials
Type :  Traditional case (Descriptive or analytical case)
Event location :  Brazil
Year of start of the event :  2005
Year the event ended :  2018
Business size :  Large enterprise