Executive Briefings

For the Most Part, U.S. Companies Working Abroad Thought to Abide by Anti-Bribery Laws

Is Wal-Mart's alleged bribery in Mexico an anomaly, or is it more typical of multinational behavior than many corporate executives would like to admit? Is the practice of bribing public officials ever justifiable from an economic or ethical point of view? And apart from collapsing share prices and shareholder lawsuits, what are some of the other possible consequences of bribing foreign officials?

Despite the hoopla surrounding the Wal-Mart case, corporate bribery of public officials remains an all too common practice in many countries around the world, according to the most recent annual report by Transparency International, a Berlin-based nonprofit with more than 100 chapters around the world. The organization's Corruption Perceptions Index 2011 charges that many governments in Asia, Latin America and the Middle East still fail to protect their citizens from the abuse of public resources, bribery and secretive decision-making. Among them, Mexico is hardly the worst offender on the list.

For all the dissatisfaction expressed in that report, corruption experts generally agree that multinational executives in the U.S. and other countries are taking anti-corruption statutes more seriously than in the past. One reason is the U.S. Foreign Corrupt Practices Act of 1977, which imposes serious penalties on U.S. companies that bribe foreign officials. In addition, a growing number of executives recognize that bribery is not only ethically wrong, but economically counter-productive.

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Keywords: Legal, Govt. & Regulatory Issues, Business Strategy Alignment, Supply Chain Analysis & Consulting, Global Supply Chain Management, The United States, Foreign Corrupt Practices Act, Transparency International, Corruption Perceptions Index 2011

Despite the hoopla surrounding the Wal-Mart case, corporate bribery of public officials remains an all too common practice in many countries around the world, according to the most recent annual report by Transparency International, a Berlin-based nonprofit with more than 100 chapters around the world. The organization's Corruption Perceptions Index 2011 charges that many governments in Asia, Latin America and the Middle East still fail to protect their citizens from the abuse of public resources, bribery and secretive decision-making. Among them, Mexico is hardly the worst offender on the list.

For all the dissatisfaction expressed in that report, corruption experts generally agree that multinational executives in the U.S. and other countries are taking anti-corruption statutes more seriously than in the past. One reason is the U.S. Foreign Corrupt Practices Act of 1977, which imposes serious penalties on U.S. companies that bribe foreign officials. In addition, a growing number of executives recognize that bribery is not only ethically wrong, but economically counter-productive.

Read Full Article


Keywords: Legal, Govt. & Regulatory Issues, Business Strategy Alignment, Supply Chain Analysis & Consulting, Global Supply Chain Management, The United States, Foreign Corrupt Practices Act, Transparency International, Corruption Perceptions Index 2011