ADEKOYA: Ah, those slush funds

A three-year investigation wrapped up last year by Poland’s Central Anti-Corruption Bureau (CBA) revealed a gigantic network of fun-and-games, including slush funds used by several international IT firms to bribe Polish ministry officials responsible for awarding government tenders.

The bribes ran into the millions while the tenders affected were worth billions of zlotys. CBA’s head has described the scandal as “the biggest corruption affair in Poland’s history.”

Those greasing ministry officials’ palms included employees of IT giants HP and IBM, and Polish investigators have asked their American counterparts for help in investigating just how much the mother companies knew about what was going on in Poland. Apparently, the corrupt practices were part of a complex and coercive process in which ministry officials who refused to take the bribes were transferred to other departments or simply fired.

Of course, the bosses in America will claim they knew nothing about goodies used to bribe Polish officials.

But the situation could prove embarrassing if the Poles arrested for bribing officials on behalf of IBM and HP cooperate with police and provide details on how such funds were created and maintained. Ultimately though, nobody high up in the firms is likely to be prosecuted. At worst, HP and IBM will be given a slap on the wrist in the form of a fine, and asked to behave themselves in the future.

Still, it’s the kind of thing that could get media traction internationally, and that won’t help Poland’s reputation. The country had been creeping up Transparency International’s “Corruption Perception Index” – a country-by-country ranking based on perceived graft in the public sector – moving from 41st in 2012 to 38th last year, not exactly a position to brag about anyway.

Big firms have slush funds with which they bribe officials in order to win contracts because it pays. The benefits far outweigh the risks and possible negative consequences for those who actually run the show. When did we last hear of the CEO of a major company being thrown in jail because his company was discovered to have dished out bribes?

Meanwhile, although consumers of HP and IBM products might voice outrage at the scandal, they are hardly going to stop buying those companies’ products.

So in essence, apart from moral considerations – hardly the driving force behind most business activity – why should big, wealthy companies stop bribing officials in order to win juicy contracts that make them even bigger and wealthier?

Companies, like humans, tend to make decisions based on a cost-benefit analysis regarding their interests. As long as the justice system remains benign in its treatment of big companies and their bosses, we can be sure they will continue to bribe their way to huge contracts. It simply makes good business sense.

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