Anti-Bribery Compliance Incentives: Advantages and Disadvantages

• Author: Fabian Teichmann
• Position: Attorney-at-Law and Public Notary, Teichmann International (Schweiz) AG
• Pages: 15-26

European Journal of Economics, Law and Social Sciences

IIPCCL Publishing, Graz-Austria

Vol. 2 No. 1

January, 2018

ISSN 2519-1284

Acces online at www.iipccl.org

15

Anti-Bribery Compliance Incentives: Advantages and Disadvantages

Dr. Dr. Fabian Teichmann

AorneyatLawandPublicNotary

Teichmann International (Schweiz) AG

Abstract

This article explores both advantages and disadvantages of anti-bribery incentives in

multinational corporations. It argues that incentives for anti-bribery compliance could help

to eliminate corruption in Eastern Europe. However, it is also acknowledged that such anti-

bribery incentives would have to be combined with other compliance tools.

Keywords: Bribery, Corruption, Compliance, Incentives.

Anti-Bribery Compliance Incentives: Advantages and Disadvantages

Corruption has been dominating the business world in Eastern Europe for decades.

Multinational corporations have tried out a large variety of anti-corruption tools.

Relatively lile aention has been paid to the idea of incentivizing employees to

act in compliance with all rules and regulations. Hence, an explorative study based

upon ten semi-structured expert interviews has been conducted. The results will

subsequently be discussed as well as compared and contrasted with the existing

literature.

AntiBriberyincentives have both advantages and disadvantagesWhile they may

notbesuitableforallemployeesandcannotbeappliedasaonesizetsallsolution

for compliance issues, they could constitute an extremely valuable supplementary

tool to existing anti-bribery measures.

Agency Theory

The idea of creating the right incentives by rewarding people for their overachievements

inorder toprevent themfrom minimizingtheir internaleortis verymuch inline

with the characteristics of agency theory. It is acknowledged that agents usually want

to be compensated for acting in their principals’ interests (McColgan, 2001: 6), and, in

this context, incentives could help to allow the agents to maximize their own utility

withouthavingtocompromisetheirprincipalsgoalsJensenMeckling

However, it should also be taken into account that both principals and agents can

havethe same goals and so avoid agoalconict GomezMejia  Wiseman 

For instanceemployees mayalready besuciently motivatedto becompliant

dueto intrinsicfactors suchas adesire tocombat bothpovertyandbriberyWhile

this approach could certainly be applicable to some employees, both the literature

andthe empirical ndings suggest that it does not proveto be true for all agents

Since multinational corporations need to implement mechanisms that are not only

applicable to a selected few or the majority but to all employees, the approach

suggested by the interviewees to create the right incentives does indeed seem to be