Upon graduation, you obtain a management position with a small food company. The company was founded 2 years earlier by three former college friends, who trust you a great deal. Learning and advancement opportunities abound because the company, headquartered in the United States, is just beginning to expand internationally. The company has an energizing entrepreneurial spirit with the belief that anything is possible if you try hard enough.

After 6 months, one of the three founders quits, and you are asked to manage several of his international accounts, including one for Kenya. Bribery is rather common in Kenya. In 2016, Kenya was ranked 139 out of 168 nations on Transparency International's corruption index; the higher the numbered ranking the worse the corruption.

While investigating the Kenya operations, you learn that your predecessor had contracted with an African consulting firm to help expand your Kenya customer base. You fly to Kenya and meet with the consulting firm agent who manages your account. Your worst suspicions are quickly verified. The agent informs you that your predecessor contracted with his company to avoid the Foreign Corrupt Practices Act (FCPA), which prohibits bribe payments. The agent expanded your business in Kenya by paying cash bribes to the chief executive officer (CEO) of a large nationwide Kenyan supermarket chain for shelf space in his stores.

You tell the agent that you can't approve of these methods, particularly because FCPA prohibits bribe payments knowingly made through third parties or intermediaries. He responds, everyone in Kenya pays bribes, it's the only way to do business. If you terminate my contract, you won't be able to do business in Kenya, and I'll tell American officials about the previous bribes I paid to your company. You mention this to the cofounders, and it's clear that they knew about the consulting firm's bribe payments.

What would you do?

1. Continue to contract with the agent to distribute your company's product
2. Terminate the contract, lose the Kenya business, and hope that the agent does not follow up on his threats to inform the U.S. Government.
3. Inform U.S. government officials about the previous bribe payments since you just started working internationally and previously didn't know about them.
4. Something else (if so, what?)

Select a choice and explain why you choose that option.