Guest Post: The Characteristics of Corrupt Corporate Cultures

Alison Taylor, the Director of Advisory Services for BSR (a global non-profit organization focused on sustainability) contributes the following guest post:

Despite all the investment in corporate anti-bribery compliance programs, supported by a lucrative consulting industry dominated by investigation companies and accounting and law firms, violations of anti-bribery laws, and firms’ own compliance policies, remains widespread. Why? The usual explanations focus on the external environment (“That’s just the way they do business over there”) or on “rogue employees,” but tend to neglect issues of “organizational culture”—how groups and teams behave when they might have a corruption problem. Yet organizational culture, structures, and incentives have been powerful factors in causing professionals to indulge in systemic corrupt practices.

But what, exactly, are the cultural drivers of corruption? What do a “culture of compliance” and its converse, a “culture of corruption,” actually look like? To find out I conducted in-depth, qualitative interviews with 23 experts on anti-corruption and corporate ethics. My questions were simple: What is the culture like in a corrupt organization? Can we generalize about leadership, decision-making, incentives, values, and behavior in corrupt organizations? Can we use these findings to understand the characteristics of an ethical culture?

The answers were revealing, and strikingly consistent in identifying the characteristics of organizational cultures prone to corruption. These traits, which I will summarize below, don’t guarantee that an organization will be corrupt — but the more of these characteristics are present, the more vulnerable an organization is. Continue reading