We’ve been campaigning about the impact of bribery and corruption on the world’s poor at the Global Poverty Project, and on the weekend, another allegation of western complicity in corruption emerged.
Two Australian companies owned by the Reserve Bank (Australia’s central bank) and six employees have been charged with bribery in Australia’s first international bribery case. The Age picks up the story:
AUSTRALIA'S foreign bribery laws are to be strengthened in the wake of the Reserve Bank of Australia corruption scandal.
The Australian Federal Police has told The Sunday Age that it has been working on suggested legislative changes with the Attorney-General's Department as a result of a 26-month investigation that on Friday led to Australia's first-ever foreign bribery charges being laid against RBA banknote firms Securency and Note Printing Australia (NPA) and six former executives.
It’s excellent news that the Australian Federal Police are pursuing prosecution – far too often these cases are settled out of court, and it’s even better that there are moves afoot to strengthen foreign bribery laws.
The guilt or otherwise of the firms and people involved remains to be seen, but in the meantime, and with the implementation last week of the UK’s new Bribery Act, it’s a timely reminder of why it’s so important we fight bribery – not just to fight poverty, but because it’s bad for business.
I’m regularly told by business owners and people working in poor countries that they have no choice but to engage in bribery and corruption at times, and so today, I thought I’d take a step back and outline five reasons why that’s not a good enough excuse, and just shouldn't be accepted by boards, shareholders, staff and the community at large.
1. It’s illegal.
Seems straight forward enough, but much like speed limits and texting while driving, it seems that in this case, the law is far too often interpreted as a polite suggestion. It’s not. The fines and jail sentences for bribery are often bigger than those for some violent crimes. From a business point of view, a bribery conviction will usually debar your firm from bidding for any government contracts, and many large business contracts.
2. Your face and brand in the newspaper for all the wrong reasons.
Bribery cases get a huge amount of publicity, as the media and public are fascinated by the sordid details of backroom deals almost as much as they are by celebrity sex lives. Few in Australia had ever heard of Securency or the Australian Wheat Board before the press coverage caused their names to become synonymous with corruption.
3. “Other people are doing it” is not an ethical escape clause.
For as long as I can remember, my mother explained to me that the bad behaviour of other people doesn’t excuse, validate or permit me to do the same. I can’t murder people just because others do, I can’t steal just because others do, and I can’t bribe just because others do.
4. Bribery promotes a race to the bottom
Paying bribes promotes paying more of them in the future. If everyone pays a bribe to win a contract, then the person or organisation running the contract process will take all the money, reward the highest bidder, and expect even more next time. It’s a business cost that will just keep growing, with no relevance to the value of your businesses services.
5. Bribery weakens institutions and rewards the wrong people.
Business needs an effective rule of law to function. You need clear property rights, enforcement mechanisms, infrastructure that works, and a workforce with the skills and capacity to grow your business. Bribery undermines all of those things by rewarding people who cut corners and do deals instead of people achieving results. It gives more power to the bribe recipient, and means that you’re undermining the institutions that you rely on for your business to thrive.
In an age where corporate reputation is increasingly important, I’m astonished at the degree to which bribery is still tolerated by companies working in poor countries.
I care about fighting bribery and corruption because it hurts the world’s poorest the most. Bribery is a risk that businesses can manage and mitigate around, for the world’s poor, it’s all too often a life or death decision.
Regardless of your motivation, this new case, and the many more I’m sure are still to come are a reminder of this, and a reminder of why our ongoing education and campaigning is so important to help fight bribery in the broader fight against extreme poverty.