Professor Nien-hê Hsieh tries to bring his students to the “gray area”—that uncomfortable and all-too-common space where leaders face difficult trade-offs across their responsibilities and commitments.

Hsieh, the Kim B. Clark Professor of Business Administration and the Joseph L. Rice III Faculty Fellow, guides students through some of the most challenging dilemmas in the business world. In the spring of 2021, all 720 members of the first-year MBA Program’s Required Curriculum class—some attending in person, some virtually—stepped into the shoes of a new case protagonist, Ziad Abi Chaker, the founder and CEO of a Lebanese recycling company, to understand the challenges he faces.

Abi Chaker launched Cedar Environmental as a sorting and composting company in 1999, but quickly realized that the waste management industry in Lebanon was rife with corruption. Securing municipal contracts required the payment of bribes, something Abi Chaker refused to do. “We took a firm decision that under no circumstances would we engage in any kind of corruption,” Abi Chaker told Hsieh. “This is a core value that is central to our reputation.”

But that value made it difficult for Cedar Environmental to survive in Lebanon. Though he could move to another country, Lebanon is home for Abi Chaker and he is committed to solving the country’s waste management crisis, which came to a head in 2015, when a dangerously overflowing landfill in southern Lebanon closed. Now, with the country in the midst of an economic collapse and its citizens still reeling from the August 2020 explosion that killed more than 200 and caused $15 billion in property damage in Beirut, Abi Chaker found himself in Hsieh’s “gray area.” Could he best help the country by taking a stand against corruption or by cleaning up its streets?

Hsieh, who is now course head for Leadership and Corporate Accountability, wrote the case “Cedar Environmental: Innovation vs. Corruption” with Youssef Abdel Aal of HBS’s Middle East and North Africa Research Center to explore both Abi Chaker’s tough decision and the larger challenges Lebanon faces. “In reading the case, you learn about the history of Lebanon, where Lebanon sits in the MENA region, and the issue of waste,” says Hsieh. “Ziad’s story opens up a whole other world that students may not be familiar with.”

That was true for Margo Tercek (MBA 2022), an American who came to HBS with a background in education policy. The case introduced her to a business environment very different from the one she knew. In the class discussion, Tercek argued that Abi Chaker should not make any compromises. “We had read so many cases about well-meaning people who made compromises that led them astray,” she says. But another classmate, who lived in a country that accepted bribery as a fact of life, challenged Tercek’s view: Would she think that if she had grown up without robust public and private sector institutions? “That didn’t convince me 100 percent,” Tercek says, “but it did make me think more carefully about the trade-offs and my limited perspective.”

The case reveals that Abi Chaker is forging his own way, crafting an innovative but risky business strategy for Cedar Environmental that does not rely on municipal waste management contracts. Hsieh hopes the students will also find their own ethical path. “This case and this course are an opportunity for students to reflect on their own commitments and then think more generally about their own calling.”

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