Bribery and Business Ethics





(Bribery and Business Ethics)

Students taking business courses are sometimes a little surprised to find that classes on business ethics have been included in their schedule. They often do not realize that bribery in various forms is on the increase in many countries and, in some, has been a way of life for centuries.

Suppose that during a negotiation with some government officials, the Minister of Trade makes it clear to you that if you offer him a substantial bribe, you will find it much easier to get an import license for your goods, and you are also likely to avoid "procedural delays", as he puts it. Now, the question is: do you pay up or stand by your principles?

It is easy to talk about having high moral standards but, in practice, what would one really do in such a situation? Some time ago a British car manufacturer was accused of operating a fund to pay bribes, and of other questionable practices such as paying agents and purchasers an exaggerated commission, offering additional discounts, and making payments to numbered bank accounts in Switzerland. The company rejected these charges and they were later withdrawn. Nevertheless, at that time, there were people in the motor industry in Britain who were prepared to say in private: "Look, we're in a very competitive business. Every year we're selling more than a ￡ 1,000 million worth of cars abroad. If we spend a few million pounds to keep some of the buyers happy, who's hurt? If we didn't do it, someone else would."

It is difficult to resist the impression that bribery and other questionable payments are on the increase. Indeed, they seem to have become a fact of commercial life. To take just one example, the Chrysler Corporation, third largest of the U.S. car manufacturers, revealed that it made questionable payments of more than $2.5 million between 1971 and 1976. By announcing this, it joined more than 300 other U.S. companies that had admitted to the U.S. Securities and Exchange Commission that they had made payments of one kind or another — bribes, extra discounts, etc. — in recent years. For discussion purposes, we can divide these payments into three broad categories.

The first category consists of substantial payments made for political purposes or to secure major contracts. For example, one U.S. corporation offered a large sum of money in support of a U.S. presidential candidate at a time when the company was under investigation for possible violations of U. S. business laws. This same company, it was revealed, was ready to finance secret U.S. efforts to throw out the government of Chile.

In this category, we may also include large payments made to ruling families or their close advisers in order to secure arms sales or major petroleum or construction contracts. In a court case involving an arms deal with Iran, a witness claimed that ￡ 1 million had been paid by a British company to a "negotiator" who helped close a deal for the supply of tanks and other military equipment to that country. Other countries have also been known to put pressure on foreign companies to make donations to party bank accounts.

The second category covers payments made to obtain quicker official approval of some project, to speed up the wheels of government. An interesting example of this kind of payment is provided by the story of a sales manager who had been trying for some months to sell road machinery to the Minister of Works of a Caribbean country. Finally, he hit upon the answer. Discovering that the minister collected rare books, he bought a rare edition of a book, slipped $20,000 within its pages, then presented it to the minister. This man examined its contents, then said: "I understand there is a two-volume edition of this work." The sales manager, who was quick-witted, replied: "My company cannot afford a two-volume edition, sir, but we could offer you a copy with a preface!" A short time later, the deal was approved.

The third category involves payments made in countries where it is traditional to pay people to help with the passage of a business deal. Some Middle East countries would be included on this list, as well as certain Asian countries.

Is it possible to devise a code of rules for companies that would prohibit bribery in all its forms? The International Chamber of Commerce (ICC) favors a code of conduct that would ban the giving and seeking of bribes. This code would try to distinguish between commissions paid for real services and exaggerated fees that really amount to bribes. A council has been proposed to manage the code.

Unfortunately, opinions differ among members of the ICC concerning how to enforce the code. The British members would like the system to have enough legal power to make companies behave themselves. However, the French delegates think it is the business of governments to make and impose law; the job of a business community like the ICC is to say what is right and wrong, but not to impose anything.

In a well-known British newspaper, a writer argued recently that "industry is caught in a web of bribery" and that everyone is "on the take";. This is probably an exaggeration. However, today's businessman, selling in overseas markets, will frequently meet situations where it is difficult to square his business interests with his moral conscience.

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The Biggest Threat to the Role of Police Officers





(The Biggest Threat to the Role of Police Officers)

Every summer about a dozen journalists gather at a former army training camp north of London to spend the day watching the training of London's special armed police unit. These are the people who regularly have to tackle the increasing number of criminals who are prepared to carry guns.

The journalists also get a chance to shoot a gun on the practice range; none of it seems that difficult, and we put most of the bullets somewhere on the target. But then we move on to the next stage of the training, where some of the problems which actually crop up on the street are imitated. The lights on the range are dimmed and we are stood in front of a large screen. We still have guns, but the bullets are fake, and videos are played where actors act out various types of situations.

Does the man holding a woman in front of him really have a gun or not? Is the man apparently preparing to surrender really going to, or is he going to raise the gun in front of him and shoot? We have to decide whether to shoot and when, just like the police officer has to when faced with this situation for real. The journalists' results here were not so impressive. I am afraid we killed many an innocent person carrying nothing more lethal than a stick.

The debate over whether more police in Britain should be armed with guns has been going on for years. The current policy is to have a small number of specialists available in each of the 43 police departments in Britain. They are kept up to scratch with intensive and regular training.

But the wisdom of that policy has been questioned as the amount of violence encountered by the police has grown. It is usually the ordinary street officer who is on the wrong end of this, rather than the armed experts who arrive rather later.

To see the direction in which the British police are heading, consider the experience of the Northumbria police who have responsibility for law and order in 5,000 square kilometers of Northeast England. The population is 1.5 million, living in rural areas and a few urban centers. The 3,600 police officers in the force deal with all the typical problems thrown up by the Britain of the 1990s.

John Stevens, head of the Northumbria Police Department, has just published his review of the past years. During 1994, for example, 61 officers (54 men and seven women) were forced into early retirement after being attacked on duty. Before being allowed to leave the police for medical reasons, they lost between them 12,000 days on sick leave: the equivalent of 50 police officers off the street for a full year.

Stevens makes this observation: "The personal cost of policing has never been so high. One third of the officers leaving were disabled in the very worst degree and will suffer for the rest of their lives for their efforts in the fight against crime."

This picture of a policeman's lot could be repeated in many other parts of Britain, yet the police themselves still oppose more widespread arming of their officers. The most recent survey, conducted last year, showed that only 46% were in favor.

The general public, however, likes the idea: 67% favored wider issuing of guns. But they, of course, would not have to carry them and maybe even use them. Recalling my own experience shooting a gun on the practice range, I certainly would not want the responsibility.

It is clear to everyone that the police need more protection against the gun and the knife. They already carry longer clubs to replace the old ones. They have access to knife-resistant coats and gloves.

The likely next step is agreement from the Government to test pepper spray, an organic substance derived from peppers which disables an attacker if sprayed in his face. If used properly, the discomfort, although extreme, is only temporary. Provided the spray is washed away with water, recovery should be complete within a couple of hours. Unpleasant, certainly, but better than being shot.

Many people in Britain would not mind seeing their police with longer clubs or even pepper spray. They would just like to see them at all. I have lost count of the times we have been filming police officers on the street when local residents have come up to us and told us it is the first time in weeks they have seen police in the area.

Actually the biggest threat to the traditional image and role of police officers does not come from guns and armed crime but the increase in the tasks we expect the police to carry out. New laws and police priorities are taking up so much time that many forces simply cannot afford to let their officers walk up and down the streets. Politicians are now asking members of the public to watch the streets. In some prosperous areas, local people pay private security firms.

Many officers believe it is all these extra duties, rather than the fear of being shot, that have really changed their role. In future, if you want to know what time it is there might not be much point asking a policeman. He either will not be there to ask or will not have the time to answer.

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The Cunning Smuggler





You may suppose that national borders are nothing to get excited about. However, Canada and the United States are very proud of theirs. These two countries share a common border that runs for thousands of kilometers, with not a single soldier along the way. Still, although there are no soldiers at the border, there are customs officers. Sometimes trucks try to cross the border with hidden drugs. Sometimes, moreover, ordinary tourists attempt to smuggle an extra bottle of alcohol. There is no difference for the customs officers; to them, all smugglers are the same, big or small. Their job is to prevent anyone from taking goods across the border illegally.

Constant struggles between smugglers and customs officers have influenced our way of thinking about this matter. It may not be fair, but many people forget the valuable services the officers perform. When this happens, the conflict may seem funny, although the officers always take their job seriously. One such conflict is said to have occurred on the famous bridge at Niagara Falls. There was a truck driver who often crossed the border for his work. Every time he reached the bridge, he had to stop his truck. He always had to show the officers all his papers. Sometimes he would be obliged to wait a long time, and on occasion the officers even unloaded his entire truck! These delays annoyed him a lot, especially because he never carried any illegal items. The truck driver did not see why he should be bothered just because other people broke the law. For many years he put up with this nuisance, but he planned to get even. When he finally retired, he put his plan into effect.

Three or four days after the driver had made his last truck journey over the bridge, the officers saw him again. This time he had no truck; he was riding a bicycle! It was a beautiful racing bicycle. The truck driver was very fit. He rode quickly, making big circles in the parking lot near the border crossing. He made sure all the customs officers could see him. Then he presented himself at the border.

"Well, old friend," said one of the officers. "What can we do for you, now you are retired?"

"The same as before," he replied. "I'm going to the other side. Check my papers and let me pass."

Now it should be said that this bicycle had one unusual feature: on each handlebar the man had hung a bucket full of sand. This was a very strange thing to do! Of course, the officers noticed it immediately. One of them called the man over to him.

"You can go through," he said, "but first I'll have to check your cargo." He looked through all the sand, but there was nothing to be seen. A little disappointed, the officer sent the retired truck driver across the border.

The customs officers laughed among themselves at the driver's strange behavior. Then they forgot about him. But only an hour later, he was back. He wanted to return to his own side of the border. He was still riding a bicycle, and he still had the buckets of sand. Another officer checked the sand. Nothing again. The man rode home happily. And this same peculiar scene was acted out twice a day, every day, for more than a year. The customs officers tried everything. They put the sand in water, to see if something was mixed with it. Then they began searching the man's pockets every time he crossed. Finally, they even had the bicycle X-rayed, to find out if anything was hidden inside. Nothing was ever found. Most of the officers ended up believing that the truck driver was simply pulling their leg. They thought he was smuggling (走私) nothing, and just playing a joke on them.

However, one officer was never convinced. To him, there was surely a mystery in the man's behavior. He knew it; only, he could not figure it out. Because it was embarrassing to fail every time, he stopped checking the man when he crossed. But he watched him. And he was certain that one day he would understand.

Eventually the officer's retirement arrived, and he too stopped working. Unlike the truck driver, he did not take up riding a bicycle. Nevertheless, he stayed near the bridge. He liked fishing. Most afternoons he threw his line into the Niagara River not far from the post where he had worked all his life. At length, the inevitable happened. The man came riding along the river road to the place where the customs officer was fishing. He got off his bicycle. For a short time, both men looked out over the river towards the great bridge. Then the officer said, "All right. I give up. It's over now, anyway; so, you can tell me. What in the world were you smuggling in that sand?"

"Nothing at all," said the retired truck driver.

"You mean, you just did it to get on our nerves?"

"Not for a moment. I was smuggling all the time. But you were never clever enough to catch me."

"It's too much," exclaimed the officer. "I knew it! I knew it! But how did you hide your illegal goods?"

"Hide it? That's just the point, I didn't hide anything at all."

"Impossible! We checked everything. What were you smuggling?"

"Bicycles."

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