The corruption eruption

In february britains bae systems a giant arms company

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1997 anti-corruption convention, leading to a spate of cross-border prosecutions. In February Britain’s BAE Systems, a giant arms company, was fined $400m as a result of a joint British and American investigation. Since then a more ferocious Bribery Act has come into force in Britain. On April 1st Daimler was fined $185m as a result of a joint American and German investigation which examined the firm’s behaviour in 22 countries.
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Companies caught between these two mighty forces—the corruption and anti-corruption eruptions—need to start taking the problem seriously. A Transparency International study of 500 prominent firms revealed that the average company only scored 17 out of a possible 50 points on “anti-corruption practices” (Belgium was by far the worst performing European country). Companies need to develop explicit codes of conduct on corruption, train their staff to handle demands for pay-offs and back them up when they refuse them. Clubbing together and campaigning for reform can also help. Businesses played a leading role in Poland’s Clean Hands movement, for example, and a group of upright Panamanian firms have formed an anti- corruption group. This may all sound a bit airy-fairy given that so many companies are struggling just to survive the recession. But there is nothing airy-fairy about the $1.6 billion in fines that Siemens has paid to the American and German governments. And there is nothing airy-fairy about a spell in prison. The phrase “doing well by doing good” is one of the most irritating parts of the CSR mantra. But when it comes to corruption, it might just fit the bill.
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