Anti-Bribery Compliance Incentives: A Potential Solution?

• Author: Fabian Teichmann
• Position: Attorney-at-Law and Public Notary, Teichmann International (Schweiz) AG
• Pages: 9-11

9

Vol. 3 No. 3

January, 2018

Balkan Journal of Interdisciplinary Research

IIPCCL Publishing, Graz-Austria

ISSN 2410-759X

Acces online at www.iipccl.org

Anti-Bribery Compliance Incentives: A Potential Solution?

Dr. Dr. Fabian Teichmann

Aorney-at-Law and Public Notary

Teichmann International (Schweiz) AG

Abstract

This article argues that incentives could help to ght corruption in multinational corporations. In

particular, it is suggested that both reducing the wrong incentives and increasing the right ones

could help to eradicate bribery. However, since the issue is rather complex, it might be necessary

to use a performance matrix in order to accurately measure and reward compliant behavior.

Keywords: Bribery, Corruption, Compliance, Incentives.

In the literature it has been suggested that (a) corruption is still a major problem for

multinational corporations; (b) incentives may sometimes even encourage employees

to pay bribes, and currently are not commonly used to prevent corruption; and (c)

agents oen behave opportunistically, and thereby may deliberately act against

their principal’s interest. It has also been inferred that, to date, both compliance and

whistleblowing schemes have not been suciently developed to prevent corruption

in multinational corporations. While prior studies seem to support the payment of

incentives to public servants in order to prevent them from accepting bribes, such an

approach has not yet been explored in depth in relation to the private sector.

Incentive systems as a management tool is a research topic that has been investigated

in depth in the past. In fact, extensive literature exists regarding incentives, goal

seing, and performance measurement. However, research on the relationship

between incentives and bribery is still rather scarce. In particular, the existing literature

focuses on incentives and corruption in the public sector but does not extend to the

private sector. Hence, further research is needed, the foundation for which has been

built in this chapter. Conceptualizations were drawn through analysis of analogous

prior research on incentives, and helped to facilitate corresponding examinations on

incentives and corruption in multinational companies.

When designing anti-bribery incentive systems, one has to address multiple questions.

Both external and internal conditions have to be taken into account. In particular, market

conditions and other multinational corporations’ goals and behavior play an important role.

However, the internal politics within the corporations, employees’ motives, and human

nature in general need to be taken into account. Hence, a profound analysis is required.

First, it needs to be dened how specically monetary rewards should be linked to

performance. Furthermore, the incentive plan needs to be designed in a way that

prevents employees from circumventing it. In addition, it should be considered how

the incentive plan aects actions that are not specically targeted. One should keep in

mind that employees can only manage a limited number of tasks. Hence, if multiple

aspects are covered by an incentive plan, weights for the individual tasks need to be

carefully chosen. Lastly, external circumstances such as market conditions will also

have to be considered (Locke, 2004: 130).