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Wednesday
Oct102018

Richard Bistrong: Let's talk about the ‘why’ of compliance

I’m a big fan of medical technology in general and coronary stents in particular (two of them saved my life). That, in a roundabout way, brings me to the subject of Ukraine.

In the New York Times last month, Oliver Bullough reported that “tens of millions of dollars were siphoned out of the health care budget by corrupt intermediaries.” 

That’s no surprise. The European Healthcare Fraud and Corruption Network estimates that $300 billion of annual global health expenditures are being lost to corruption.

What that meant from a practical perspective in Ukraine (and globally) is that patient services, care and outcomes are compromised. And, as Bullough wrote, with Ukraine’s “high rates of smoking and drinking, and the national delicacy -- salo, or cured pork fat,” surgeons have “long struggled to obtain stents” to unclog blocked arteries.

What changed was that after the 2014 revolution, “Ukraine’s health ministry asked international bodies to procure medicine and medical equipment on its behalf,” as Bullough states, “to cut out the crooked insiders.”

In response, the United Nations and the British nonprofit company Crown Agents took on that procurement role, according to Bullough, and the price of stents dropped by $3 million.

That meant more than 50 percent more stents were purchased in Ukraine and inserted for patients nearing heart attacks or heart failure, as I once was.

More stents for Ukraine meant that in 2017 “20 percent fewer people died than in 2015.” Today, “420 Ukrainians are still alive as a result,” Bullough said.

It's an uplifting story. But what's it mean for us right now?

It’s easy to rationalize corruption, even petty corruption, as victimless. For example, I was selling lifesaving products including armored helmets, vests and vehicles. Sometimes, due to the corruption, I was getting those products to the people who needed them most even faster.

I wasn’t pulling layers out of a bullet resistant vest, so I wasn’t thinking of it as anything other than a win-win. After all, the company was getting the sales, I was making my objectives, forecasts and bonus, the intermediary moved to the next opportunity, and the often poorly paid public official got a little something to make ends meet.

From nice inner-city hotels and business class lounges, I wasn’t spending my evenings on the Transparency International website thinking about how even petty corruption robs societies of good governance, human rights and economic development.

I was numb to the consequences of my conduct -- upon society, my former employer, and of course on my family. I didn’t think bribing a Dutch police official could one day be connected to hurting innocent employees, customers, and transparency in public procurement.

To deepen our understanding of this peril, there’s disturbing research published in a 2012 paper called Self-Serving Altruism? When Unethical Actions That Benefit Others Do Not Trigger Guilt. As the three authors share from their findings,"When others can benefit from one’s dishonesty people can consider larger dishonesty as morally acceptable."

When being dishonest, we might even cast ourselves in the role of altruistic hero, as counter-intuitive and abhorrent as that sounds. For example, major pharma and medical device graft scandals, when examined closely, rarely involve tampering with the quality of the products. Instead the individuals might have felt virtuous for using "unorthodox" means to get world-class medicines and medical devices to the doctors, patients and hospitals who needed them most.

It sounds farfetched. But I know firsthand that those who work in isolation and in high-risk environments can think that way. I did.

So what's the antidote to that flawed and dangerous thinking?

At the next sales meeting, talk about the 420 Ukrainians alive today because of better, even if imperfect, governance.

Talk about how corruption, big and small, has a sharp end. Share stories like Robert Appleton’s investigation of mosquito nets being purchased in Africa that were not properly treated, consider displaying images of buildings and bridges that collapsed due to inspectors getting paid off, and so on.

Talk about the why of compliance.

During my presentations, I often display a quote about the company’s commitment to ethics, compliance and sustainability from their website. I then ask my audience if they know where those words come from. Many don’t.

It's time to make certain commercial teams are inspired by the values their company espouses. It's time to talk.

____

Richard Bistrong, pictured above, is a contributing editor of the FCPA Blog and CEO of Front-Line Anti-Bribery LLCIn 2010 he pleaded guilty to a conspiracy to violate the FCPA and served fourteen and a half months at a U.S. federal prison camp. He was named to Compliance Week's list of Top Minds in 2017 and was one of Ethisphere's 100 Most Influential in Business Ethics in 2015. He was named by Thomson Reuters in 2018 as a Top 50 Social Influencer in Risk, Compliance and RegTech.

His popular real-life compliance training video, Behind the Bribe, produced in cooperation with Mastercard, was released in 2017. To request a demo of the full eleven-minute video or a licensing fee schedule, please click here.

Reader Comments (2)

Excellent article: crystal clear to anyone that has some doubts about the need of anti-bribery system in place.
There is the issue of the direct money that is not directed to public welfare.
But, usually there is more: The selection of projects prioritizing the pockets of the persons and companies involved in the corruption system, instead of the public welfare alone.
October 11, 2018 | Unregistered CommenterJose Anson
Let's talk about the Why - thank you for highlighting this critical point, Richard. When compliance programs are perceived as merely protecting the company or top executives from legal liability, it has a negative impact on employees' perception of and support for the program. (Treviño et al. 1999) When we look at these issue through the frame of social responsibility and consider how the company's behavior affects the well-being of its stakeholders (including employees'), the fight against corruption has the potential to become aspirational, the conversations shifts from mere regulatory risk avoidance toward how we as a company can help make the world a little better. The conversation becomes meaningful.
October 11, 2018 | Unregistered CommenterCarsten Tams

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