Multinationals NOT a big source of corruption


Dear Ted,

Thanks for sharing your further thoughts (below) on the causes of corruption. I do not agree that multinationals are a major source of the problem. If they were, we would expect to see higher levels of corruption where the multinationals do most of their business. The opposite is true.

In the chart you prepared comparing corruption levels around the world, Scandinavian countries like Finland are rated among the least corrupt. Yet Scandinavia does much more business per capita with outside multinationals than do much more corrupt African and southeast Asian countries like Indonesia. (It is interesting to note that oil rich Norway is considered slightly more corrupt than its neighbors - but far more honest than other oil producing nations.)

I think that another column in your chart - IQ averages in the nations listed - has much more to do with corruption. When the majority in a country are not very smart (and usually not well educated), a small group of the brighter elite in that nation can get away with corruption that would not be tolerated in a Scandinavian country. That elite sets up systems to benefit themselves, even in the democracies in places like South America. A good free press can help expose corruption. But it needs an educated public which understands complex issues in business and government ethics. A few dedicated judges or whistle blowers in government cannot long survive without public support.

A well-educated public can go a long way in stamping out corruption. In discussing ethical issues, the public's opinion in any nation is shaped by its religious and cultural traditions. I wonder if the Buddhist and Hindu emphasis on the individual, family, and local group welfare might condone some forms of corruption more than in the West. Helping the poor and feeling guilty about ill-gotten gains (as with the Medicis of Florence) are attitudes that reduce the acceptability of corrupt practices. You may point out the recent business scandals in the US as evidence to the contrary. But I would argue that the "dirty laundry" is evidence of an anti-corruption bias in American society. The fact that we do not read about corruption being exposed in the Philippines or Congo surely does not mean it is not happening!!

Van Sloan


Dear Van Sloan:

It would appear corporations are to blame for the worldwide corruption problems. One of the reason is that companies get off easy for paying bribes while the accepting bribes is not. I am not trying to pass the buck that government cannot be blamed for the country's problems. Government corruption directly effects their economy. However, if you look it from the point of view of a worldwide problem than it would appear that globalization through large multinationals may accelerate the worldwide problems of corruption.

Again, Van, I want to thank you for the support on my topic of corruption. It's interesting and we need a more basic conceptual understanding of them that we perhaps all know about but we need now and then to remind ourselves what we are doing wrong.

Ted in Thailand


Note: Then after getting Sloan's email above, Ted writes: "I agree with you. Yes, multinationals ARE NOT THE MAJOR CAUSE of the corruption problems."

Go to: Nations ranked from least to most corrupt

Go to: Causes of Corruption

Go to: Nation rankings on business competitiveness

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