Why Firms Engage in Corruption: a Top Management Perspective

Corruption exists in almost all firms, public or private, even though there are many risks involved since it is a “necessity” for being competitive according to business statistics. Numerous companies join the bandwagon to engage in corruption because it seems as if that’s the only way ‘things get done’ and firms will remain in business. The firms which do not engage in fraud will be at a disadvantage compared to the other companies which are corrupted. Last but not the least, the company officials justify corruption and encourage dishonest behavior to stay on top.

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Engaging in Corruption Becomes A Necessity Now days, corruption is a common issue and engagement of firms in illegal corrupt transactions is growing. It has become a must because it is a normal part of doing business and to keep up, one must engage in various types of corruption even if they don’t wish to. For example, if one firm is benefiting in numerous ways for getting work cut out for them by corruption, then why should another firm play fair and be at a disadvantage. In business, everyone is in for the profit even if it means sometimes being involved in fraud.

In conclusion, it is the executives of the companies that pass an act of corruption as a necessity for being competitive to their associates. Corruption: A Competitive Advantage Corruption as the article defines; “an act done with the intent to give some competitive advantage inconsistent with official duty and the rights of others”, for most officials is the way to go! As mentioned before, engaging in these activities gets things done, meaning corruption is a short cut because when you try to get a task completed with full honesty, it either takes forever or never gets done.

Therefore, involvement in corruption is a competitive advantage for almost all firms and they would not miss an opportunity to get ahead in any way possible. The main business motto as most would agree is succeeding at any cost. Company Executives Justify Corruption Executives have power and as a result, they simply justify their actions as morally or ethically valid. One would think that managers know corruption is harmful to the society or the fear of being caught, but no. Executives’ nowledge of the dangers that come with corruption did not affect their willingness to engage in these behaviors. Despite the costs and risks, officials continue to justify corruption because of the ‘importance of engaging in illegal acts. ’ Of course, no statistics can prove these unethical acts because no one would admit to them but researchers rely upon perception based measures. Engagement in corruption has existed forever and continues to be an issue without a solution.