The answer is, in fact, perfectly obvious:
But none of the principals involved here are corporate lawyers. None of them has any ethical duty of confidentiality toward Penn State and certainly not toward Sandusky. They have absolutely no ethical, moral or legal basis for not immediately dialing 911 after witnessing the rape, or hearing about it secondhand. Grad students have no professional obligations against disclosure. There is no football-coach privilege. The ethical football coach can and often must disclose your failure to give 110%.
And Sandusky’s alleged conduct doesn’t even implicate the school. He was an individual. His alleged crimes are individual criminal felonies. Indeed, his crimes only began to implicate Penn State after Penn State officials chose to sit on their hands for years on end. If a corporate lawyer walks into the company bathroom and sees the VP of Marketing raping a child, that lawyer calls the cops.
It’s not uncommon for the media to oversimplify complex moral questions. But in the Penn State case, too many people are just obfuscating very straightforward moral questions.