Is It Time To Pull Out The Handcuffs?
June 9th, 2011
June 9th, 2011
Global Financial Integrity Managing Director Tom Cardamone has written a blog post for the TrustLaw website examining the shortfalls of anti-bribery and anti-corruption compliance efforts at companies around the world. A study showed that a third of firms saw anti-bribery programs as “an example of the governments imposing costly and excessive requirements”, demonstrating a lack of motivation in reducing unethical business practices.
Referencing the effectiveness of penalties for corrupt practices, Cardamone writes:
An even closer read of the stories behind these fines shows that seldom do they make a significant dent in the profits of the firms involved and rarely does anyone go to jail. And if there ever is any investor angst in reaction to charges of wrongdoing—as could be seen in a drop of a company’s stock price—it is fleeting. Perhaps the quickest way to drive home the point that corruption will be given no quarter is to have cold steel clicked around the wrists of an increasing number of corporate executives.
Many companies still have a long way to go before they can be said to seriously be fighting corruption in their business practices. Prison will be a stronger deterrent than fines, which tend to be less than the profits gained from illicit activities.
The blog post, which you can read in full on the TrustLaw website, is the second in a series of Tom Cardamone’s views that will henceforth appear on the TrustLaw website fortnightly on Thursdays. Visit Mr. Cardamone’s TrustLaw author page to stay up-to-date with his latest posts.