The Dilemmas Surrounding Issues of Corruption - Essay Example

The Dilemmas Surrounding Issues of Corruption The Dilemmas Surrounding Issues of Corruption The fight in contradiction of corruption remains as one of the biggest nightmares facing world leaders and CEOs all over the world. The complexities involved in determining what comprises a corrupt practice contribute a great deal to these difficulties. Scholars who research on multinational enterprises have an understanding of the complex relationship between international business and society. Among all the spheres of international business studies, research on corruption is somewhat still in its embryonic state, with important unsolved questions on the extent, framework and techniques remaining unanswered. Nevertheless, tremendous steps have been taken on combating this vice. For example, the International Monetary Fund (IMF) and the World Bank have undertaken high-profile dedication to eradicating corruption from within their ranks and associations. This paper critically explores the different dilemmas in another group of players, multinational corporations. These have more often than not encountered challenges on how to pursue commercial activities in a country with high rates of corruption while maintaining their own anticorruption and human rights policies. Bribery and corruption are major public concerns in several countries. This has been brought about by the increasing press coverage on corrupt public officials. Economists today recognize corruption to be a major setback to development. Even though the fight against corruption calls for a serious commitment by several players, the international business community has a crucial role to play. The main difficulty in curbing corruption and bribery lies in the very fact that its definition is controversial (Albrecht et al. 2005). There is no known single meaning as to what comprises corruption and bribery. In their broadest sense, the words refer to transactions which are in essence “bad”. This broad definition of the words lacks any practical interpretation of corruption. Thus, it becomes difficult to distinguish between acceptable corporate relationships and corrupt engagements. The society argues that one will know corruption when they see it. Nevertheless, the subtle differences between some practices and corruption make the identification of such more difficult. For instance, whereas some argue that corporate relationships require aspects such as trust and rapport, the line between the facilitation of such practices and absolute corrupt dealings is thin. Similarly, there are several practices which are tolerated as an excuse for corruption. The acceptance of gifts and numerous allowances accorded senior officers are in most instances regarded as corrupt (Johnston, 2005). Facilitation payment has become a major concern on multinational corruptions in their definition of corrupt practices. In its broadest sense, facilitation payment refers to a payment made with the intent to facilitate a public official perform duties which they are legally entitled to (Cox, 2008). These payments are often demanded by low income officials towards performing duties within their legal, operational boundaries. Most nations distinguish between facilitation payments and outright corruption, whereas others render it as one of the forms of corruption. Moreover, some permit facilitation payment only as a last resort (Cox, 2008). Withstanding, it is true that the higher the amount paid to the official, the higher the chances of its being a call for law enforcement. Facilitation payment is one of the unsolved mysteries of the Organization for Economic Corporation and Development (OECD), since the convention does not include them in its list of corrupt practices. The main challenge in this practice lies in formulating a system that recognizes the complex situations experienced by businesses while ensuring a consistent check on anticorruption guidelines. Again, corporate entertainment and hospitality, which refers to the entertainment of the members of a corporation, a convention or guests, may sometimes disguise corrupt dealings. Businesses and corporations occasionally hold feasts for their members. This may happen at the beginning or end of the business year, or another unique event in the corporation. The awards and compensations provided to facilitate these events are deemed as necessities for the development of businesses. Similarly, some backdoor bribery practices such as the support of cultural organizations ran by the relatives of politicians are difficult to categorize, even though most of them are necessity corruption. A bribe presented in such a manner may be difficult to point out, and the prosecution of such crimes will require the inclusion of other corruption codes. Most of the known codes do not prohibit the acceptance of presents or entertainment from business accomplices. Thus, the borderline between legal hospitality and bribery is noticeably fuzzy. Some corporations restrict the level of hospitality to coincide with internationally set codes (Glaeser and Goldin, 2008). The number of codes linking such a practice to corruption varies from institution to institution. Some make a clear distinction between cash and other items, making tangible gifts acceptable in some conditions. Nepotism is another mild form of corruption which creeps in almost every avenue of public service and private entrepreneurship. It refers to the favoritism accorded to friends or relatives in unfamiliar transactions such as promotions at work place, the allocation of tenders and the hiring and firing of employees (Gordon and Miyake, 2010). In the public sector, the practice is looked down upon and scorned. This is not the case in privately run corporations. Anti-nepotism policies in some companies deter the hiring of close relatives in the corporations. Even though this may reduce the risk of outright nepotism, it does not control it all together (Doig and Theobold, 2000). The demand for bribery to facilitate business compels clean entrepreneurs to engage into corruption. Johnston (2005) argues that it is much easier to cast a moral vote against corruption. However, this will not help anyone get an employment. Thus, if one has two options, the unemployment of his people, or engagement in corrupt dealings, corruption becomes the lesser evil. This suffices with the understanding that multinational companies are not morally obliged to change the cultures of the nations in which they operate. However, there is a moral obligation to ensure that people get jobs. Conclusively, this paper has highlighted some of the prevalent dilemmas in combating corruption in multinational corporations. It has also noted some of the strategies which are used in its control. However, the lack of a proper implementation of these policies contributes greatly to their prevalence. References Albrecht, H., Das, D., Sarre, D. (2005). Policing Corruption: International Perspectives. New York: Lexington Books. Cox, M., (2008). State of Corruption, State of Chaos: The Terror of Political Malfeasance. New York: Lexington Books. Davoodi, R., Tanzi, V. (2000). Corruption, Growth and Public Finance, Is. 2000-2182. Washington D.C: International Monetary Fund. Doig, A., Theobald, R. (2000). Corruption and Democratization. London: Psychology Press. Glaeser, E., Goldin, C. (2007). Corruption and Reform: Lessons from America’s Economic History. Chicago: University of Chicago Press. Gordon, K., Miyake, M. (2010). Business Approaches to Combating corruption: a Study of Codes of Conduct. New York City: Springer Publishers. Johnston, M. (2005). Civil Society and Corruption: Mobilizing for Reform. New York: University Press of America. Read More