The Rise In Globalization Has Increased Corruption Risks.
With globalization on the rise, the world economy is seeing its fair share of challenges. Increases in these markets can note the upward trend in stronger economic arenas, but with success comes challenges and those challenges are beginning to increase the vulnerability of industries, large and small, in the world markets. The biggest challenge we are referring to is corruption. As industries expand their operations and take on new business partners, the chances of their operations exposing themselves to a problem like corruption, grows exponentially.
Leonard McCarthy, of the World Economic Forum, writes in his article, “Has Globalization Made Corruption Worse” ,how corruption distorts markets by “removing any notion of a level playing field.” Free and fair market trade is what increases globalization and it drives world markets to perform at its highest. When actions of corruption become a factor, ethics and safety become a risk, creating a situation where one side gets it all, while the other side is left with nothing.
“When the collapse of a bridge or building leads to preventable deaths, it’s worth digging around to see if bribes were paid. We see a consistent pattern, of companies cutting corners on safety and quality in order to recoup the cost of the bribes they pay government officials to win contracts. Even something as mundane as waste removal, which does indeed have an impact on the environment, can be distorted by corruption. The problem with fraud and corruption is that they prevent good solutions and sound policies from reaching their full potential.”
Interesting enough, with the rise of globalization, transparency needs to be a key component in making sure corruption is not a growing and ongoing problem. But McCarthy suggest that, globalization can be held responsible for this increase.
“However, many also cautioned that while increased international attention has helped move the anti-corruption agenda forward, globalization is responsible for an increasingly sophisticated form of corruption. We have to ask whether corruption-fighting solutions have kept pace with the integration of financial systems, global supply chains and multi-jurisdictional entities.”
Ultimately, having a system in place, within your organization, is vital to even minimizing the potential risk of corruption. Companies need to remember, although you are aware and sure your organization does not practice any malicious activity, such as corruption, you are still liable if your business partners (suppliers) are guilty of the act. Source Intelligence has developed a leading industry platform that assists companies, large and small, to monitor these potential risks and examines ways in which you can better protect yourself, your company, and your brand.
To learn more visit our website and for a free assessment to measure your anti-corruption efforts and compliance program click here.
