To what extent does corruption represent a challenge for global companies in your experience?
The more complex and international a company is, the more important it is to implement effective structures to ensure compliance with all applicable laws, standards, and guidelines – including the rules for avoiding corruption. Anti-corruption is one of the central motivations for establishing compliance management systems – in medium-sized enterprises as well as big global corporations.
What special anti-corruption challenges are companies facing that operate internationally?
In a study by my institute at the HTWG, we investigated the challenges faced by companies implementing compliance. One of the biggest challenges was implementing a compliance system worldwide, in particular in so-called “high-risk countries”, in which corruption represents a ubiquitous problem. The special problem for a global company in that situation is to implement compliance not just as an adequate compliance function at headquarters, but also to develop and safeguard compliance as a line responsibility. Ultimately, every executive – not just the Chief Compliance Officer – bears responsibility for the company obeying the rules and behaving ethically.
What can companies and legislators do to promote integrity?
The most important lever for implementing integrity standards in business is management determination and executive training. A key success factor for compliance and anti-corruption efforts are trainings and workshops which enable executives and staff on the ground to make and carry through their own responsible and rule-conform decisions. This applies both to classical legal issues like corruption and to ethically relevant questions like observance of human rights. Companies also need to set up anonymous information systems for staff and business partners. Also advisable are regular staff surveys to measure the ethical climate in the company. At the political level, the introduction of a national corruption register would create another possible lever. However, stiffer punishments are not the way forward.
Stephan Grüninger is Professor for Managerial Economics at the University of Applied Sciences Konstanz (HTWG) and Director of the Konstanz Institute of Corporate Governance (KICG), the Center for Business Compliance & Integrity (CBCI) and the Forum Compliance & Integrity (FCI).