This surprises everyone how?

Bribery a way of life for companies operating in emerging markets

His study identified no particular sectors or executives from certain countries as being more likely to indulge in corruption, and said he was surprised that only 85pc admitted to using bribes.

I’ve worked in places where you can’t get in or out of the country, let alone do anything else, without bribery. These laws saying that you must not bribe Johnny Foreigner create hypocrites, not less bribery.

13 thoughts on “This surprises everyone how?”

  1. I can remember the amazement of certain personalities in an US company I worked for when I reported we were being asked for bribes somewhere in the Middle East. We are blessed, although such lilywhite convictions wouldn’t survive weekend during a project in Chicago either 🙂

  2. Our attitude towards bribery should be zero tolerance in our own country, but if it is the way business is done in the Bongolese Republic (or southern Italy), then it’s not for us Brits to get on our high horse. Respect local traditions, pay the man and earn a few quid.

  3. ‘Er indoors, who hails from somewhere around the Middle East, looked at me with utter incomprehension when I told her about the public sector’s Bribery Act and the lefties’ handwringing over Saudi arms sales business.

    As in, “well of course you have to bribe them, idiots.”

    She was gobsmacked that anyone could be so naïve.

  4. MC’s right: we should ban bribery in our own country, fine. And we can even get the FO to do whatever they can (not much) to encourage other countries to ban it. But insisting that our own subjects may not pay or receive bribes when trying to work in countries where bribery is endemic? It’s always struck me as completely stupid.

    Banning our subjects and companies from working in such countries at all could work, I suppose. Would have all sorts of other disadvantages, obviously, but it would solve the hypocrisy problem.

  5. It’s interesting.

    All the comments above are spot on – as in “sure, it’s not our culture, but if that’s how the Bongolese do it”.

    And the same experiences myself of non UK (and not too far across the Channel in some respects)

    Why are our political class so utterly naive and inept?

  6. So Much For Subtlety

    Every time the Obama administration hits someone with a massive fine, there is usually a clause in there somewhere that says part of the fine has to go to some “community organisation” or other. That is, the activist arm of the Democratic Party.

    How is that not corruption too?

    Anyone want to bet Volkswagon will end up paying for part of Obama’s retirement?

  7. Smfs
    Quite. We are naive to think we are not corrupt in our own country.
    Kickbacks (section 106 notices) and contract padding (preferred supplier) are endemic.

  8. One of the best comments I heard in my career was from a young Indian colleague with whom I attended a week-long seminar in Paris with a thousand of us in attendance. One of the topics was corruption, and he stood up and said words to the effect of:

    “The perception in India is that the only reason the West is now clamping down on corruption is because, having practiced it themselves for decades, companies from places like India are now out-bidding them on major contracts and they are trying to stop this from happening. It is pure hypocrisy.”

    I gave him a hearty round of applause.

  9. When I worked for a large US corp and we had to do ethics training as a mandatory requirement the section on bribes had at the end that this did not apply where you were complying with local customs. One example was where refusing a gift would be disrespectful, of course you had to declare it etc.

  10. Last night I was at a presentation and dinner provided by a non-client (I used to wonder why they invited me but this year I know it’s simply because the lass arranging it has inherited a list of invitees from her predecessor) and the guy on my left was moaning about the rules where he couldn’t buy some clients a cup of coffee (while he could buy one for some other clients). I told him that when I was his age (before he was born) my firm had a sensible rule – that one couldn’t accept a gift that did, or might be thought to, influence one. OTOH I regularly used to accept one of the surplus diaries sent to my immediate boss by various stockbrokers OTOH when someone sent a case of wine to a middle-ranking guy it got sent back as soon as he returned from lunch.
    Giving bribes is a more complicated issue pace Tim Newman. Under Nehru, Indian civil servants’ pay declined from stupendous to inadequate to feed a family, so they charged a fee for any work done – was that a bribe to get an unmfair advantage?

  11. Corruption is not itself a problem – it is that it is the symptom of the real underlying problem: legal barriers to trade. Officials are appointed to enforce barriers to trade. You pay bribes to those officials to bypass the barrier. Bypassing the barrier is of course a good thing – free trade, and all that – so corruption per se is not a bad thing. It is the cure for the problem of government.

    The big problem with corruption is that it perpetuates bad government, because it motivates government officials to *create* new barriers to trade, in order to make a personal profit from the graft. These barriers then cripple the local economy, keeping it as a third-world hell-hole. Government-created corruption-motivated bureaucratic barriers one of the biggest obstacles to eliminating poverty left.

    The Peruvian economist Hernando DeSoto did a major study on the reason Capitalism hadn’t worked in the developing world (see ‘The Mystery of Capital’), and found that it was because most of the capital was excluded from the legal economy by these barriers. They did an experiment where they simply set up a company in each country, legally, by-the-book, without bribes (a task that generally takes no more than a few weeks in the West). In many cases it took months or years to achieve. As a result, most small businesses cannot afford the legal costs and so do their business on the black market, which is hugely less efficient due to the lack of long-range, long-term enforceable contracts, and legal ownership of land or houses (the most common form of capital for small businesses in the West).

    Getting rid of bureaucratic barriers to trade would be enormously beneficial, and the only way to do that is to eliminate the motivation for maintaining them. If you can’t get easy access to Western capital and expertise, that imposes a cost and hence applies pressure to get rid of the system.

    It would help a lot if people doing business there understood this, and made the point repeatedly to bribe-takers that their country is (relatively speaking) a poverty-stricken hell-hole precisely because of the regulations bribery is used to bypass, and the reason you’re not allowed to pay them is not because your own government is being hypocritical, over-moralistic, or unreasonable, but because they’re trying to help. It’s not the people offering (or necessarily even those taking) bribes that are the problem – it’s the people making the rules that make bribery necessary.

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