Corruption in global mobility: a threat to your financial compliance?

According to Transparency’s Global Corruption Barometer, 57% of people think their government is doing badly in the fight against corruption. In fact, only 8 of the 76 evaluated governments were doing well, according to the majority of respondents.

Corruption and bribery is clearly a widespread issue, and it may affect global mobility departments more than you think.

Bribery & corruption are not equally prevalent around the world, but bills need to be paid, even in notoriously mismanaged countries. How can you be sure that all payments are fully compliant?

Transparency International’s research paints a highly variable global picture. Only 6% of Germans believe their public sector to be corrupt. By contrast, 69% of Moldovans believe their public sector is unclean. (Research suggests that the public sector – and the police in particular – is more prone to bribery than the private sector.)

Published earlier last year, the Corruptions Perception Index 2018 lists all countries in order of corruptibility. There are, frankly, few surprises in the countries at the top and bottom of the list.

Countries affected by political turmoil or war are inevitably less able to control financial practices, whereas established democracies have a much better record in combating financial irregularities and non-compliance.

For the record, the most corrupt countries are – according to the 2018 report – Somalia, South Sudan, Syria, Afghanistan and Yemen – while the cleanest acts are currently New Zealand, Denmark, Finland, Norway and Switzerland.

Although there is a common aim across the world to reduce corruption, there is no clear consensus on how to legislate against it. Countries are proposing new anti-bribery & corruption legislation and becoming more aggressive in the way government regulators enforce those laws. Enforcement agencies are also cooperating across borders, and more countries are introducing individual criminal liability for bribery-related offences.

If you want to know more about the anti-corruption landscape in the countries where you are sending assignees, Global Compliance News features a very useful interactive map. Click on a country for information about primary anti-bribery legislation and enforcement agencies, offences, defences and penalties.

Statistics suggest bribery & corruption is a bigger problem now than ever. In 2017 we saw some of the biggest corporate fines ever imposed, politicians and senior executives sent to prison, and a number of large corporations embarrassed. 

Yet these events perhaps mainly suggest that the global profile of the problem is higher than ever, which is a good sign. They were accompanied by demonstrations, anti-corruption crackdowns and elections contested on the back of anti-corruption manifestos – so we should therefore see these events as proof of a bigger profile, not of a bigger problem.

Either way, it is a warning that we cannot ignore it. Whether it is cash demanded by corrupt government officials, or free dinners and gifts expected by customers, it is all a compliance risk.

It is not the role of the global mobility industry to lead a crusade against corruption. Your main job is to ensure compliance amongst your assignees. For that, you need to be increasingly watchful, which suggests you should do the following:

• Research anti-corruption and bribery laws in destination countries

• Encourage understanding of bribery & corruption guidelines amongst expats before they leave.

• Conduct anti-corruption audits

• Log and report all instances of attempted corruption/bribery

One of the best solutions is stringent supplier selection. All FIDI affiliates are committed to upholding the highest ethical standards, as laid out in FIDI’s Anti-Bribery & Anti-Corruption Charter.

Additionally, the local knowledge of FIDI affiliates can also help you find local suppliers who adhere to similar standards. Through their support, and your vigilance, you can take steps to ensure your global mobility operations comply with anti-bribery & anti-corruption guidelines.