5.5.1.0 Introductie

As has been demonstrated in section 5.3, corruption involves considerable risks for companies. These risks include significant extra costs (bribes paid), damage to a company's reputation, multiple jurisdictional legal risks (criminal penalties and restitution payments), damage claims from shareholders, and the potentially personal liability of directors. In addition, when a company is under investigation for allegations of corruption, there are high hidden costs: a severe drain on management time, staff morale will be damaged, the company's integrity profile will be damaged, lawyers' and accountants' fees will be substantial, the company funders may choose to impose stricter conditions, the company may find itself barred from participating in government procurement programmes or may lose export or other licences to do business, and there will be a disruption to the company as a whole. In such a situation the organisation becomes 'semi-paralysed'. Pursuing 'business as usual' becomes increasingly difficult, and releasing energy to develop new projects almost impossible. Following legal proceedings, one of the outcomes is often that the company agrees to establish an anti-corruption programme. This happened in the ABB and Siemens cases described in section 5.1. Therefore, companies may wish to stay well clear of corruption. It would seem arguably cheaper for them to avoid corruption altogether rather than having to defend themselves against various allegations in legal proceedings. In this section, it will be explored what companies can do to prevent themselves from becoming a part of corruption; thereby focussing on best practices in corporate anti-corruption programmes. These programmes are incentivised by public and private regulation.