Corruption generally describes a decline in morals that is based on the fact that an expectation is violated. This expectation is defined by a trust provider (a company, the public, etc.), which establishes a behavioral expectation. Corruption describes the visible breach of trust when these behavioral expectations are not met. In the company, these expectations are also called compliance.
Corruption always attacks the social fabric, which is built on trust. In addition, corruption can begin as early as the time of signing the employment contract, when the offered position is to be used to fulfill one’s own interests or the interests of third parties. Thus, a pretense of facts takes place here. The pretense of loyalty is also used to deceive the company and to abuse trust.
Motives for corruption arise from the imbalance of one of the following needs:
– Meaning
– recognition
– success
– attention
If one of these needs is in an imbalance, there is a desire to restore one’ s satisfaction. This can result in the willingness to open up to other people who give the appearance of being able to restore satisfaction. This can show itself, for example, in the passing on of information in order to gain recognition, but also in the acceptance of money in order to reinforce one’s own success. A clear action ( contrary to a corruption) shows itself in case of existing dissatisfaction in a dismissal.
Corruption is always adapted to the opportunities offered by the workplace. Also the amounts that can be taken from the company and cause damage are very different. However, it should be noted that the damage is usually already very large when corruption becomes known. Moreover, corruption always builds up a stable relationship between a corrupt person and a partner in corruption, which can grow over several years.
It is also possible that other employees are involved in the corruption and only support it because they otherwise face a disadvantage in their position (e.g. a transfer). Corruption in Germany is now considered to be very low compared to other countries. This is also due to the fact that in some of these countries, people are paid poorly and either have to earn more money through legal channels or find ways to earn more money in their jobs.
The damage to the company is threefold:
– Financial damage
– Dependencies on corruption partners
– Damage to reputation
The financial damage is based on the fact that the corrupt person not only wants to gain an advantage for the company, but also puts money in his own pocket. The company thus pays more money, which, however, is not set aside for the acquired goods/services.
The dependence on the corruption partner shows itself for example in the restriction to a single supplier. The latter can demand higher payments and thus poses a challenge to the company, which has adapted its processes to the favorable deliveries. In this case, the company’s existence is threatened if, for example, tenders that have been won can no longer be fulfilled at the planned costs and an increase in costs is no longer possible. In addition, the corruption partner can demand a share in the company and thus create an opportunity for money laundering.
Reputational damage is to be expected when corruption is uncovered. This does not always occur internally within the company, but can also be done by external bodies. The result is negative reports in the press. At this point, the only thing that can be done is to try to prevent the damage to reputation and to keep the trust of the customers (and the public) with a good crisis communication.
If you would like to know what makes up good crisis communication, then listen in to our or take a look into our blog. Otherwise, we look forward to welcoming you to an upcoming podcast episode on exciting new topics.
An article written by Anna Müller, published on 10 August 2020
Translated by Charlotte Ley