The systemic role of corruption and its link to low human development is explored. The extractive resource industry is presented as anarena where conditions for corruption—monopoly and discretion without accountability—are especially intense. Corruption is maintainedby a self-reinforcing cycle. Multiple stakeholders are involved in the maintenance of and/or opposition to the cycle: investing corporations, host country regimes and officials, inter-governmental bodies like the OECD, industry associations, non-governmental organization watchdogs like Transparency International, and international agencies facilitating global investment like the World Bank. (...) Complementarity of interests between the demand and supply sides provides strong incentives for entrenched players to maintain corruptive relationships, to protect past gains and sustain current ones. Compulsory international regulation, maximum transparency, effective detection, and enforcement are recommended to enhance accountability, thereby reversing the cycle. It is also necessary to create a corporate culture built on integrity, if regulation itself is to succeed. (shrink)

Based on a survey of 237 managers in Singapore, three measures of organizational ethics (namely, top management support for ethical behavior, the organization''s ethical climate, and the association between ethical behavior and career success) are found to be associated with job satisfaction. The link between organizational ethics and job satisfaction is argued from Viswesvaran et al.''s (1998) organizational justice and cognitive dissonance theories. The findings imply that organizational leaders can favorably influence organizational outcomes by engaging in, supporting and rewarding ethical (...) behavior. (shrink)

Corruption Perceptions Index (CPI) scores for 47 countries reported by Transparency International were used to ascertain determinants of bribe taking in international business. Two sets of independent variables – economic and cultural – were used in a multiple regression analysis. Results indicate that bribe taking was more likely to be prevalent in countries with low per capita income and lower disparities in income distribution. Cultural factors such as high power distance and high masculinity in a country were also likely to (...) be associated with high level of bribe taking. Both economic and cultural factors were important explanatory factors of bribery. Implications of the findings for combating bribery are discussed. (shrink)

Abstract: The systemic role of corruption and its link to low human development is explored. The extractive resource industry is presented as an arena where conditions for corruption—monopoly and discretion without accountability—are especially intense. Corruption is maintained by a self-reinforcing cycle. Multiple stakeholders are involved in the maintenance of and/or opposition to the cycle: investing corporations, host country regimes and officials, inter-governmental bodies like the OECD, industry associations, non-governmental organization (NGO) watchdogs like Transparency International, and international agencies facilitating global investment (...) like the World Bank. Complementarity of interests between the demand and supply sides provides strong incentives for entrenched players to maintain corruptive relationships, to protect past gains and sustain current ones. Compulsory international regulation, maximum transparency, effective detection, and enforcement are recommended to enhance accountability, thereby reversing the cycle. It is also necessary to create a corporate culture built on integrity, if regulation itself is to succeed. (shrink)

In global business, business organizations and their representatives frequently encounter corruption and may be the perpetrators, victims, or simply participants in such acts. While international corruption has existed in multiple forms for several years, many individuals, companies, nations, and international organizations are currently attempting to reduce or eliminate corrupt acts because of their harmful effects on local economies and the quality of life of citizens. Several of these corruption curtailment efforts have been directed toward the supply-side of corruption, i.e., those (...) who make corrupt payments. In developing an understanding of corruption, however, and formulating strategies for its reduction, consideration must also be given to the demand-side of corruption, i.e., those who demand and accept corrupt payments. Accordingly, this study examined the demand-side of corruption and several related factors in the categories of government, economy and poverty, education, geography, and culture. Analysis of these factors employed the Corruption Perceptions Index (CPI), formulated annually by Transparency International (TI), and other sources. Several factors in each of the five categories were found to correlate significantly with perceived corruption, and strategies for addressing these issues were developed and discussed. (shrink)