Alison Taylor: Is this how corrupt companies talk?
Tuesday, June 9, 2015 at 10:12AM
Alison Taylor in Africa Sting Operation, Enron, Joseph Sigelman, PetroTiger Ltd, SNC-Lavalin

Corrupt organizations expect employees to parrot one set of values, while at the same time understanding that the real priority is to subvert these values by paying bribes to win business, or looking the other way when issues arise. This mixed messaging creates a level of ambiguity, which you see clearly in the use of euphemism, code words and metaphors in many corruption cases.

At SNC Lavalin, bribes were coded as PCC, which stands for Project Consultancy Cost. Enron described the millions it spent in India in the 1990s as money to educate Indians.

The notorious FBI-driven Africa Sting operation collapsed at the trial stage, partly on the basis that participants never referred specifically to bribe payments -- the jury did not consider that talk of a 20% commission to the minister was sufficiently unambiguous.

The former CEO of PetroTiger, Joseph Sigelman, is making the case that email exchanges discussing how to characterize the Manila Split payments are so vague that they do not prove corruption.

In banking, it's common to refer to compliance training as "sheep dipping," which conveys an implicit disdain for the process, but also an understanding that all employees must go through it.  

Cultures of corruption need employees to navigate a world where the leadership is telling them to do one thing, while implicitly directing them to do something else. These signals are not difficult to follow, but require an initiation process that socializes the employee to accept corruption, and even regard it as a privilege to be included in the joke. It explains the use of metaphors to describe corruption, the prevalence of in-group culture in corrupt organizations, and the creation of mystique around corrupt teams, who deliberately limit the access available to more ethical outsiders.

Compliance processes make no sense in a vacuum. It's time to look carefully at who holds power, how decisions are made, who interrupts who, euphemism and body language. In seeking to identify corruption, look first at which teams are so high performing and highly regarded that they escape normal levels of scrutiny. This might be more useful than reviewing lists of which employees have undergone the annual sheep dip.

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Alison Taylor is director of advisory services at BSR, a non-profit consultancy and company network focused on sustainability and CSR.

Article originally appeared on The FCPA Blog (http://www.fcpablog.com/).
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