U.S. companies were found to have higher propensities than their European counterparts to offer bribes in exchange for business deals in foreign markets, according to a recent report by Berlin-based Transparency International, an organization monitoring global corporate corruption.
Business experts in the world’s largest 15 emerging market economies ranked companies from the United States, along with Japan, as the seventh-likeliest of the top 21 exporting countries to pay bribes to foreign government officials. Australia was rated the least likely to offer bribes, while Russia was considered the most likely to do so in the export markets surveyed.
Joe Whitley, former U.S. attorney in Atlanta, found the report to be indicative of the world’s perception of American businesspersons, which has been further tainted by the Enron Corp. scandal.
“The United States is the world’s leader in any category of business, but it is also disliked because of its preeminence and the ‘ugly American’ image of the domineering U.S. businessperson,” Mr. Whitley told GlobalFax.
“The Enron case has had so much global publicity that it must impact U.S. companies’ reputation around the world,” he said. Perceptions of U.S. firms’ capacity to bribe, including those of foreign businesspersons surveyed in the Transparency International Bribe Payers Index, would have to be influenced by such scandals, he added.
U.S. firms rapidly expanding into new markets, undergoing significant growth or acquiring or merging with other firms are at the greatest risk of engaging in corrupt activities such as bribery and should take extra precautions, he added.
Mr. Whitley urged Atlanta firms to have compliance plans and corporate codes of conduct in place to detect and solve problems with corruption, including bribery. A partner in the Atlanta law offices of Alston & Bird LLP, he added that the firm offers consultation to local businesses on such matters.
For companies trying to enter certain markets, however, “grease payments,” or tips to public officials, are seen as permissible and even necessary in order to do business, Mr. Whitley said. Some African countries, he noted, have been notorious for accepting bribes. Russia, he said, is still suffering similar image issues resulting from questionable practices during its continued transition to capitalism.
And countries in the Middle East have traditionally had the worst ratings of compliance with the Foreign Corrupt Practices Act, U.S. legislation agreed upon in 1977 outlining standards international companies should meet to limit corruption.
Mr. Whitley was somewhat surprised about U.S. companies’ rating as more corrupt than firms in several European countries, Canada and Singapore because of the U.S.’ traditionally high compliance with the Foreign Corrupt Practices Act.
Contact Mr. Whitley at firstname.lastname@example.org or (404)
881-7000. Visit www.transparency.org for more information.