Bribery - Business

Business

Employees, managers, or salespeople of a business may offer money or gifts to a potential client in exchange for business.

For example, in 2006, German prosecutors conducted a wide-ranging investigation of Siemens AG to determine if Siemens employees paid bribes in exchange for business.

In some cases where the system of law is not well-implemented, bribes may be a way for companies to continue their businesses. In the case, for example, custom officials may harass a certain firm or production plant, officially stating they are checking for irregularities, halting production or stalling other normal activities of a firm. The disruption may cause losses to the firm that exceed the amount of money to pay off the official. Bribing the officials is a common way to deal with this issue in countries where there exists no firm system of reporting these semi-illegal activities. A third party, known as a White Glove, may be involved to act as a clean middleman.

Specialist consultancies have been set up to help multinational companies and SMEs with a commitment to anti-corruption to trade more ethically and benefit from compliance with the law.

Contracts based on or involving the payment or transfer of bribes ("corruption money", "secret commissions", "pots-de-vin", "kickbacks") are void.

In 2012, The Economist noted:

Bribery would be less of a problem if it wasn't also a solid investment. A new paper by Raghavendra Rau of Cambridge University and Yan Leung Cheung and Aris Stouraitis of the Hong Kong Baptist University examines 166 high-profile cases of bribery since 1971, covering payments made in 52 countries by firms listed on 20 different stockmarkets. Bribery offered an average return of 10-11 times the value of the bung paid out to win a contract, measured by the jump in stockmarket value when the contract was won. America's Department of Justice found similarly high returns in cases it has prosecuted.