Bribery - an inevitable evil?

Students taking business courses are sometimes a little surprised to find that lectures on business ethics have been included in their syllabuses of study. They often do not realize that, later in their careers, they may be tempted to bend their principles to get what they want; perhaps also they are not fully aware that bribery in various forms is on the increase in many countries, and, in some, this type of corruption has been a way of life for centuries. In dealing with the topic of business ethics, some lecturers ask students how they would act in the following situation: suppose you were head of a major soft-drinks company and you want to break into a certain overseas market where the growth, potential for your company is likely to be very great indeed. During negotiations with government officials of this country, the Minister of Trade makes it clear to you that if you offer him a substantial bribe, you will find it much easier to get an import licence for your goods, and you are also likely to avoid 'bureaucratic delays', as he puts it. Now, the question is: do you pay up or stand by your principles? It is easy to talk about having high moral standards, but, in practice, what would one really do in such a situation? Some time ago the British car manufacturer, British Leyland, was accused of operating a 'slush fund', and of other questionable practices such as paying agents and purchasers with padded commissions, offering additional discounts and making payments to numbered bank accounts in Switzerland. The company rejected these allegations and they were later withdrawn. Nevertheless, at this time", there were people in the motor industry in Britain who were prepared to say in private: 'Look., we're in a wheeling-dealing business. Every year we're selling more than a £1,000 million worth of cars abroad. If we spend a few million greasing the palms of some of the buyers, who's hurt? If we didn't do it someone else would. It is difficult to resist the impression that bribery and other questionable payments are on the increase. Indeed, they seem to have become a fact of commercial life. To take just one example, the Chrysler Corporation, third largest of the US motor manufacturers, disclosed that it made questionable payments of more than $2.5 million between 1971 and 1976. By making this revelation, it joined more than 300 US companies who had admitted to the US Securities and Exchange Commission that they had made dubious payments of one kind of another — bribes, facilitating payments, extra discounts, — in recent years. For discussion purposes, we can divide these payments into three broad categories. The first category consists of substantial payments made for political purposes or to secure major contracts. For example, the US conglomerate ITT (International Telephone and Telegraph Corporation) offered a large sum of money in support of a US presidential candidate at a time when it was under investigation for possible violations of the US anti-trust law. This same company, it was revealed, was ready to finance efforts to overthrow the Marxist government of Chile whose President was Salvadore Allende. In this category, we may also include large payments made to ruling families or their close advisers in order to secure arms sales or major petrochemical and construction contracts. In a court case involving an arms deal with Iran, a witness claimed that £1 million had been paid by a British company to a 'go-between' who helped clinch a deal for the supply of tanks to that country. Other countries have also been known to put pressure on foreign companies to make donations to party funds. The second category covers payments made to obtain quicker official approval of some project; to speed up the wheels of bureaucracy. An interesting example of this kind of payment is provided by the story of a sales manager who had been trying for some months to sell road machinery to the Minister of Works of a Caribbean country. Finally, he hit upon the answer. Discovering that the minister was a bibliophile, he bought a rare edition of a book, slipped $20,000 within its pages, then presented it to the minister. This man examined its contents, then said: I understand there is a two-volume edition of this work.' The sales manager, who was quick-witted, replied: 'My company cannot afford a two- volume edition, sir, hut we could offer you a copy with an appendix: A short time later, the deal was approved. The third category involves payments made in countries where it is traditional to pay people to facilitate the passage of a business deal. Some Middle Fast countries would be included on this list, as well as certain Far Eastem countries. The payment may be made by a foreign company to ensure a tender is put on a selective contract list or the company may pay so that an import licence for essential equipment is approved. Sometimes an expensive gift may be necessary to soften up a government official. A common type in this category is the 'facilitating payment' — usually a smaller sum of money - made to certain customs officials to clear cargoes. One businessman has told the story of a delivery of 10,000 bottles of sterile penicillin at the airport of a Far Eastern country. It was apparently customary to pay customs officials about $250 upon arrival of each shipment to 'get them out of the sun'. In this case, the company was not prepared to make such a payment, so no money changed hands. The Minister of Health of that nation then ordered that each phial be opened for inspection, thereby destroying the whole shipment. Is it possible to formulate a code of rules for companies which would outlaw bribery in all its forms? The International Chambers of Commerce (ICC) favours a code of conduct which would ban the giving and seeking of bribes. This code would try to distinguish between commissions paid for real services and padded fees. A council has been proposed to administer the code.

Unfortunately, opinions differ among members of the ICC concerning how to enforce the code. The British members, led by Ford Shawcross. would like the system to have enough legal teeth to make companies behave themselves. 'It's no using having a do without teeth', they argue. However, the French delegates think it is the business of governments to make and impose law: the job of a business community like the ICC is to say what is right and wrong, but not to impose anything

In a well-known British newspaper, a writer argued recently that 'industry is caught in a web of bribery' and that everyone is 'on the take'. This is probably an exaggeration. However, today's businessman, selling in overseas markets, will frequently meet situations where it is difficult to square his business interests with his moral conscience.

Date: 2015-12-11; view: 1273