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Fri, 20th January 2017

Anirudh Sethi Report

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OECD Says-Big companies pay most bribes; bosses know

Most international bribes are paid by large companies, often with the full knowledge of senior management, the Organisation of Cooperation and Economic Development said in a report.

The OECD study – based on analysis of data emerging from all foreign bribery enforcement actions concluded since the introduction of its own Anti-Bribery Convention in 1999 – also found that most bribes are paid in advanced countries instead of emerging markets.

The OECD report cast doubts over the frequent corporate defense to graft claims that senior executives were unaware of the bungs.

Most international bribes are paid by large companies, usually with the knowledge of senior management.

The report defined a large company as one with more than 250 employees. It added:

In 41% of cases management-level employees paid or authorised the bribe, whereas the company CEO was involved in 12% of cases.

The OECD found that the majority of bribes it studied were paid by companies to governments or state-owned enterprises, in order to secure contracts.

Bribes are generally paid to win contracts from state-owned or controlled companies in advanced economies, rather than in the developing world, and most bribe payers and takers are from wealthy countries.

The majority of cases it found occurred in four industries: resources extraction, construction, transport and IT.

The below graphic from the OECD’s own report sets out its findings further.

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