Why A Gradual Approach To Tackling Corruption Might Make More Sense

The continuing controversy over the staging of the Football World Cup in Qatar serves to underline the difficulty of applying sets of rules and attitudes across the world. Indeed, the fact that the criticism in parts of the western media of the decision to hold the tournament in a country with what many in the industrialized world regard as a questionable human rights record has itself come in for criticism illustrates what a complicated area this is. It is a situation with which many multi-national companies have long been familiar as they have sought to respect local mores and customs at the same time as avoiding failing foul of their home countries’ and international laws and protocols.

Nor is the World Cup the only current or recent event highlighting the issue. At the recent COP27 climate change summit in Egypt there were frequent accusations of hypocrisy levelled at western nations seen as advocating green energy for Africa and other less developed parts of the world while they continued to use fossil fuels.

So, what is to be done? One approach that might help take some of the heat out of the exchanges is found within a recent paper from a group of European business school academics. The article draws on a thesis by one of the authors, Stefan Schembera, based on interviews he conducted with executives at the the German industrial company Siemens in the wake of a $1.4 billion international bribery scandal that came to light in 2006 but had been taking place for many years before. But there were also contributions from Andreas Georg Scherer of the University of Zurich and Patrick Haack of HEC Lausanne, the business school at the University of Lausanne.

In a recent interview, Haack explained that the research sought to deal with the limitations seen with compliance-based approaches to corruption arising from the different expectations, values and beliefs held in different parts of the world. Pointing out that experience from the financial services world suggests that strict rules do not always work and can in fact have the opposite effect, he says that tackling corruption requires “little steps.” By regarding reaching of certain milestones as progress towards an ultimate goal, governments and policy makers can agree on pragmatic solutions that are much more likely to bring about the behavioural change that is required.

But even allowing for cultural differences, there are sometimes instances where organizations — knowingly or otherwise — fall short of the highest standards. The paper produced by Haack and his colleagues explains such lapses through what academics call “decoupling.” This takes two forms. The first is policy practice decoupling, which refers to where policies are set out but not actually implemented in practice (the classic situation with “greenwashing,” where an organization makes claims about the sustainability of its activities that are not borne out in practice). The second is “means-end” decoupling, which is where practices may be fully implemented but will not bring about the goals they are supposedly designed to achieve.

The need for a pragmatic approach derives from the trade-offs and tensions involved in finding remedies for the different forms of decoupling. And at the heart of this is what some theorists label a “sense-making” approach. The idea is that organizations cannot force managers to do something that they do not understand. Instead, there need to be initiatives aimed at securing a shared understanding of what is required.

Haack does not pretend that it is easy. He emphasizes that it is a complex area for both companies and countries, with no straightforward answers. As an example, he says that there might be public pressure for a country to stop child labor. But if it does that in isolation without other action it might create more poverty.

It is also true that attitudes and priorities change. One of the reasons for the controversy over the hostile media coverage of the Qatar World Cup is that when other big sporting occasions were held in countries that did not share western values — for example the Beijing Olympics in 2008 and the Football World Cup in 2018 — there was not so much furore. Some might argue that the answer lies in the greater size and importance of China and Russia, but it could also be argued that the West was still trying to “engage” with these countries on the basis that they might be encouraged to adopt western-style policies. Attitudes have hardened now, and Russia’s attack on Ukraine, which has been taken much more seriously in the West than was the annexation of Crimea earlier, and China’s generally tougher policies toward Hong Kong have left many thinking they were naive before.

However these worrying developments in geopolitics turn out, it looks to be vital that governments, policymakers and business leaders realize that they need to take a more gradual and consensual and less rules-based approach towards dealing with the big issues of our time — notably climate change but also areas such as supply chains, diversity and inclusion and human rights. It is no good having a few sirens of best practice and everybody else undoing their good work. As Haack suggests, it is better to widen the net by lowering the barriers to entry initially because the more entities that are involved the greater the effect will eventually be.