A shocking corruption in the world

A shocking corruption in the world 

Alstom’s corruption event occurred great reflection all over the world at that time and it was famous for its brazen. According to the DOJ, Alstom recognized that it made a gorged book and noted the guilty of failing to achieve enough control of officials in many countries, especially in Egypt, Indonesia and so on. According to research from AlixPartners recently, there are more than 85% of companies think that they have corruption risk and even some of them think bribery exists anywhere.  

  

As for the famous corruption event, Alstom and the subsidiaries confessed that they made bribes to the officials from the government in order to they can get the qualifications of electronic power, grid, and transportation program that from state-owned businesses. In addition, in a specific country-Indonesia, one of the most important parts in the corruption event, Alston also paid bribes to the lawmaker in Indonesia and the member of national electricity enterprise. And in this way, the company got a $3.75 million contract. As we can see, it must be a profitable business, so Alstom tries its best to make it, even though using corruption. Actually, FT article states that Alstom did not Voluntary disclosure this error behavior, even though it knew a similar corruption thing before.   

 

As we all know the business environment is complexed, which causes some companies management and government officials cannot control their behavior. Although they know this is illegal. As far as I know, some people had to sign a very frightened code of conduct before entering the company. The details of the conduct include many aspects, especially in bribery, and it rules that everyone cannot offer and accept any cash or other ways to/from the third party, including but not only strict to government officials, customers, and broker and others. Thus, people have signed a formal legal document, but is it effective? Only relying on the document to restricted people’s behavior, should boards breathe a sigh of relief? Actually not. I suggest that pay more attention to the ground in the markets far from home, beyond the serious wording, what is happening? From the research of HSBC recently, I think although people have signed a document to bid their behavior, the bad atmosphere is still existing, it damages the company now. In my view, promoting good practice and ethical at the top might have a small effect on those things that are not easily seen by the boards of directors. Sometimes, it is unavoidable, but it may cause more anxiety about actual or potential problems.  

  

As for the Alstom event, they were pushed by the DOJ and admitted the guilty. However, in my opinion, the plea agreement does not substantially change the overall economy of the transaction. This is shocking bribery in the world, it reminded companies, ringing the alarm. But how many people will take this lesson and lead a good economic development environment?  

  

Even though shocking bribery has occurred in Alstom many years ago, a news reported that a former executive at a UK company has been condemned for paid bribery to officials in order to win a €240m contract. It makes people upset. Alstom didn’t learn anything from lessons. Through these examples, I understand corruption is always a serious problem, like cancer, it always plagues the business world.  

  

About the prevention and detection of bribery, as far as I know, financial professionals always cannot find the bribery easily in the company, so they need to be sharp-witted. Also, it should be cautious for bankers, they need to be careful of the clients’ bank account, to raise their guard, in order to avoid corruption via the account. Moreover, for some financial professionals and officials also pay attention to the gifts, discounts and even some appreciation.   

  

In addition, the UK Bribery Act also offers law protection via full legal defense. There is, therefore, it usually attaches great importance to British companies on bribery training. Firstly, in my opinion, a strong internal control can make a better business environment in a company, and clean business culture. And then, the risk evaluation is also an essential aspect, do due diligence, support correct report and making fines for non-compliance. Good policy and communication also play an important role in the process. Besides that, I also thought, it is not adequate to write, information must be delivered on a regular, verbal and action basis. The cost of unethical is expensive, even over the cost of the expected return. To this end, the board of directors must offer opportunities to listen and protect honest informers and do their powerful shelter.