The Role of Cultural Skills in Mitigating Corruption Risks in Corruption-Prone Industries and Geographies
By Natalie Richter
“Corruption, and the perception of corruption, erodes trust in governments, businesses and markets. In the aftermath of the greatest financial crisis of our time, we need to rebuild that trust more than ever before. Corruption also undermines growth and development. On the one hand, businesses forego innovation and competitiveness for bribery. On the other hand, individuals within governments divert funds for their own personal use that should be used to promote the well-being of people. By ending impunity and holding corrupt people to account, we can begin to restore faith in our institutions and industries.”
The above quote was taken from an in-depth 10-year OECD study of global bribery and corruption practices that was published in December 2014. As regulatory bodies’ understanding of global corruption evolves to incorporate more and more types of scenarios, the risk of global companies being caught in unethical practices increases. What does this mean for global mobility risk management in 2016?
In 2016, the global economy has slowed. China’s economic engine, one of the greatest drivers of global growth, is also slowing down. This is also a time when the price of oil has plummeted while the cost of continued exploration and production is not dropping. Will expatriates working in high corruption-prone industries and geographies take more chances and go rogue in the hopes of making a larger profit for the sake of their shareholders or themselves? What is the cost of that risk in terms of money and reputation in the short and long term?
While Peter Y. Solmssen was still General Counsel for Siemens AG in 2013, he was asked to define sustainability . He focused not only on the environmental factors but also the ethical ones. He said, “… it [also] means having an economic system that works for everyone. It means having responsible citizens, both corporate and individual…. that actively fight corruption and bribery.” This belief was borne out of a very expensive global corporate corruption scandal in 2008 which cost Siemens 1.6 billion and led to some very important lessons learned while it rebuilt trust in its global brand…
Published in Global Benefits Vision, March 2016, download the full article.