CORRUPTION DEBATE

Lord Haskel

Yesterday we had a debate about corruption.  Of course everybody was against it, particularly in Third World countries where it undermines economic progress and social and political institutions.

But when it comes to business some people weren’t so sure.

Corruption is often hidden in the form of fees or taxes or commissions.  And if these are needed to help get the business instead of your competitor, then a little flexibility is needed.

Fortunately I was faced with this very early in my business career.  I told their Lordships a little cautionary tale.    Corruption debate Hansard. My company developed some new technology in the textile industry and the way it could used in many countries was through licensing.  On one occasion I had to convince an official to give us a permit.  In his bookcase were copes of Dickens, Shakespeare, the Oxford English Dictionary and so I complimented him on his his interest in English literature.  He looked at me and handed me a copy of Dombey and Son.  I opened it up and inside was a cut out which exactly fitted American dollar bills.

As I said in the debate, I am not sure whether it was my distaste for corruption, my uncertainty about the law, my concern for our reputation or my love of books, but this deal never did go through.

However, we did sell that technology in 23 other countries and later several people told me that they bought our license instead of others exactly because we did not pay bribes.  This gave them more confidence that our technology would work.

It was the cash flow from these licenses that helped the early business grow.  It also convinced me that a strong ethical culture is good for a business.

This is why we should stop watering down the Bribery Act and bring it into force now.

14 comments for “CORRUPTION DEBATE

  1. Lord Blagger
    18/03/2011 at 12:19 pm

    So Trustcott et al

    Was he involved in bribery when he offered to change legislation for cash?

    A few months slap on the wrist and back in business.

  2. Carl.H
    18/03/2011 at 1:20 pm

    I think this very difficult and inpart insurmountable.

    Define Corruption.

    A member of the House visits a school, they are notified in advance and put out the best. What the Lord see’s is a corruption of normality.

    I have an important client, when he visits I give him the best tea and expensive biscuits.

    A competitor meets the client in his Arsenal FC Corporate Box and continues the meeting at a fine London Restaurant.

    Another competitor sends a private jet for the client and his family so he can spend 2 weeks talking about the deal in the tranquil setting of Barbados.

    The final competitor say’s I could talk in Barbados etc., but wouldn’t you prefer cash.

    ———————————————

    1.Find the agent’s maxim (i.e., an action paired with its motivation). Take for example the declaration “I will lie for personal benefit.” Lying is the action; the motivation is to fulfill some sort of desire. Paired together, they form the maxim.

    2.Imagine a possible world in which everyone in a similar position to the real-world agent followed that maxim. With no exception of one’s self. This is in order for you to hold people to the same principle, that is required of yourself.

    3.Decide whether any contradictions or irrationalities arise in the possible world as a result of following the maxim.

    4.If a contradiction or irrationality arises, acting on that maxim is not allowed in the real world.

    5.If there is no contradiction, then acting on that maxim is permissible, and in some instances required.

    ——————————————-

    The noble Lord did not start in business to fail and knew he had to compete. Competition requires an edge to be the best and to continue. Betamax was far superior to VHS, it failed because consumers were bribed with lower prices. Supermarkets promote loss leaders, that is sell below cost in order to get more custom.

    Bribery & corruption exist,it always will. In our World of International Trade it will difficult to legislate what is acceptable.

    “and so I complimented him on his interest in English literature.”

    A sales technique designed to be manipulative, used by many sales people. Feeding a person flattery in order to give them a release of dopamine and norepinephrine, while reducing low activity in serotonin – a form of drug which makes them feel good. Corruption or not ?

    • Lord Haskel
      Lord Haskel
      22/03/2011 at 10:47 am

      I agree it is difficult. My point is that a reputation for being incorruptable can help a business just as much as paying a bribe. Each company has to decide.

  3. MilesJSD
    milesjsd
    18/03/2011 at 1:39 pm

    That is a money-corruption area; and I too fear it and as a low-income state-pensioner experience it too.

    I am one who also fears other forms and levels of corruption, not simply of the English language (now long since the world’s ‘default’ common-language) from which we (English) are corrupting the world’s minds and spirits with definitive-headings such that ethnic-persecution becomes “ethnic-cleansing”, and being-shot-in-the-back-by-own-troops becomes “friendly-fire”;

    but for a deeper-hidden instance, when the UN WHO Declaration for Primary Health Care 1978 (that’s “Health”, not “Illness”) should have taken root in UK it did not; simply because the various powers-that-be up there (mainly of course the BMA, but equally the House of Lords expertises-bodies) swept it all under the long pre-existing and almost monopolistic Primary Medical Care shingle and complex hierarchical-structure.

    My comprehension towards such other corruptions than of isolated-monies came after I had sighted another little ‘corruption-of-the-common-mind’ coming ‘down’ from the United Nations’s Model for the domains of a civilised human life, which were
    1. Physiological (needs)
    2. Emotional
    3. Mental
    4. Social
    5, Spiritual
    but which fell down, at least under “Mental” and “Social”, because they failed to deal with “Mental” as being of-the-various-mind-functions;
    and failed to distinguish and separate-out “Work” from “Social” ;

    which for me boiled-down to a corruption of the responsible-minds not simply within the originating UN but within every government and intellectual-body thereunder including the primary-school-teaching-body.

    (In short there, there are many mind-functions within the human-individual and within different groups of humans, many of which if not all are corruptible and some of which are being habitually corrupted)

    It might follow that much monetary-corruption derives its “teeth” from such mind-corruptions; might it not ?
    ————
    1339F180311.JSDM.

    • Lord Haskel
      Lord Haskel
      22/03/2011 at 10:48 am

      Yes, mental corruption does have its special problems. I am not sure we know how to tackle them.

  4. Carl.H
    18/03/2011 at 1:42 pm

    P.S. Lord Haskel using all capitals even in a heading on the internet is bad form. It depicts SHOUTING.

    • MilesJSD
      milesjsd
      18/03/2011 at 8:49 pm

      NOT necessarily, Carl H.

      it all depends on the holistic or synergic Context

      don’t you think ?

      2049F180311.JSDM.

      • maude elwes
        19/03/2011 at 10:44 am

        To continue with corruption: Town hall officialdom going from Councilors receiving no salary to Councilors receiving £230,000 + per annum. And said councilors then hiring an adviser to do the thinking for them and paying those people £50,000 per annum????

        Tony Blair selling us out to George Bush under the guise of ‘Weapons of Mass Destruction’ when the real deal was ‘we will make life a lot healthier for you Tone once you shed the office of PM.’ Close your eyes to the ‘rendition’ flights and we will double the bounty. That was once the kind of ‘corruption’ men used to be shot at dawn for.

        Lying to the electorate to get their vote. And once in office refusing to discuss the issue. Add to that the refusal to call another election as the first was a con.

        Refusing to demand and get a settlement on the audit of the EU budget and deal with the blatant theft by the Commission of all EU tax payers money.

        Refusing to be truthful about who devises the laws coming from that same EU in order to remove our freedoms. Not letting the British people know the laws are set by British lawyers who then shield politicians from exposure of that tyranny behind the, ‘it’s Europe who create these policies we have nothing to do with it.’

        Corruption by giving funders, old friends, relatives and politically correct faces seats in the Lords, when they have no laudable claim to that privilege. Hence the chamber filled with inept, self promoters reducing the level of intelligent, honourable decisions on our collective behalf.

        Arms dealing that if the truth was ever revealed in all its glory the outcry would bring down the governments of every colour.

        You know where the corruption is across the board and you know what should be done to rid us of it. But will you?

        We can only trust you will!

        • Lord Haskel
          Lord Haskel
          22/03/2011 at 10:50 am

          I was dealing with business corruption. Moral corruption is far less clear cut and this makes it more difficult to identify and face up to. Corruption in politics is yet more difficult. But we will try to root it out wherever we can.

          • maude elwes
            22/03/2011 at 1:03 pm

            @Lord Haskel:

            On listening to radio 4 this morning, one of the ‘Nat West Three’ speaking of his extradition to the USA and consequent charges for corruption, etc., only one conclusion can be reached and that is, business and corruption are joined at the hip.

            However, to take that one step further, corruption, like all matters of leadership, begins at the top. As Mrs Thatcher liked to repeat, it trickles down dear.

          • Lord Blagger
            22/03/2011 at 1:17 pm

            It’s more difficult because you haven’t made it illegal or sacked those involved.

            Why is Truscott still sitting as a Lord?

  5. Dave H
    18/03/2011 at 11:24 pm

    Even in a private company we have as part of our employment contracts some clauses related to accepting gifts. While part of that is undoubtedly because a few people tend to be the ones offered gifts because they’re the known face to suppliers or customers and others are unlikely to be offered anything, it also endeavours to reduce any attempt to gain commercial advantage by gifts.

    I agree with Carl on the difficulty in drawing a line to determine what is bribery and what is just good business practice. There is a huge grey area where each case needs to be considered on merit, and a typical jury may fail reach a verdict.

    Totally unrelated, but vaguely on-topic, when Lord Norton was giving me a tour of Parliament last year, I was amused to note the location of two ATMs by the sign pointing to the “Votes Office”.

    • Lord Haskel
      Lord Haskel
      22/03/2011 at 10:53 am

      You obviously work for a sensible company. When drawing the line between bribery and good business practice I was making the point that a reputation for not being bribable is itself good business practice.

  6. maude elwes
    23/03/2011 at 5:01 pm

    Corruption in business: GP’s and various medical suppliers receive perks and gifts in order to select certain medications and a varied number of products from companies who are benevolent. This sends the NHS bill through the roof.

    This kind of perk giving is rampant throughout government offices. Back handers and holidays, etc., for arms selection. Road works and road signs, planning applications by developers. Take a look at those who selected companies for the Olympic requirements.

    The Olympics, akin to the Millenium Dome, was well known as a back hander for the boys and friends of those who have the options in their gift. It runs though the entire consortium. And this kind of corruption runs through the nation.

    The real corruption always involves government, one way or another.

    http://en.wikipedia.org/wiki/Political_corruption

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