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Corruption time bombs


Themes: Corporate governance and ethics

Corruption time bombAn acknowledged expert in the field of corporate corruption feels that multinational companies must lead the fight against dishonesty

Dr Stelios Zyglidopoulos, University Lecturer in Strategy at Cambridge Judge Business School believes that corporate corruption is more widespread than ever and is being fuelled by the economic climate.

“At the organisational level, it starts from persistent demands for a particular performance that is not feasible given existing resources, coupled with a lack of control mechanisms. At the same time, the financial control mechanisms have over the last few years been focused on whether you achieved your goals and not focused enough on how you achieved them. If you give it enough time and enough pressure and you put enough people under this pressure, eventually some of them will start cheating and they will make the organisation corrupt.”

The estimated loss to world economies through corporate corruption runs into billions of pounds impacting both the developed as well as developing nations.

“I think that the standard in certain countries where corruption is very prevalent has to be set by multinational corporations not because they are the most ethical companies or that they are the paradigms of morality. There’s simply nobody else to do it.”

Quoting the story of the President of Siemens going directly to the Russian government to bring their attention to the corrupt demands of a tax official, Dr Zyglidopoulos says, “That’s how it has to be dealt with and how the companies within the country have to behave.”

He is supported by criminologist Dr Barak Ariel, Jerry Lee Fellow in Experimental Criminology at the University of Cambridge.

“Large organisations are under pressure in an age of austerity to do things they are not supposed to do. Everybody in the end will get hurt from it. Not only them but society all together.”

‘Understanding and Preventing Corporate Corruption’ is the title of a three-day executive education programme in which Dr Stelios Zyglidopoulos and Dr Barak Ariel will go through research evidence on corporate corruption as well as applied knowledge from anti-corruption campaigns.