(Published in The Manila Times under the Managing for Society column, March 22, 2005)
Foreign businessmen rank the Philippines as the second most corrupt country in Asia, according to a recent survey conducted by Political and Economic Risk Consultancy Ltd. (PERC), a Hong Kong-based consultancy group.
Also, previous studies by the Asian Development Bank (ADB) and Transparency International have placed the Philippines among the most corrupt countries in terms of the magnitude of irregular payments, including bribery, in public contracts.
The historical background as well as the ramifications of corruption in the country has been discussed extensively in print and television. There is no doubt that it stifles investment and economic growth in the country.
Given the large amount of evidence about the corruption problem, why is the progress against it moving at a snail’s pace?
An explanation is that corruption is pandemic—that it is culturally ingrained. A study in 2002 by the Philippines Jesuits, which led to a book entitled Cross-Sectoral Study of Corruption in the Philippines, noted that the poverty in the country is “inextricably linked” to corrupt practices that are deeply rooted in the Philippine society. This “culture of corruption” is described as one of “crippling submissiveness of socially reinforced incapacity to do anything about corruption.” Corruption is so haunting and prevalent because society condones it.
In particular, the private sector is not without blame. As a frequent source of bribes for public officials, the private sector shares responsibility for this culture. The ADB study mentioned that enterprises resorted to bribery in obtaining government permits and extracting contracts.
How can the private sector help in nipping the spread of this culture right at the bud? The answer lies in how companies promote ethical conduct and values in the workplace. With employees and workers spending at least forty-hours-a-week in the workplace, surely the organization has a strong influence in how they behave.
It is encouraging that there has been stronger focus on social responsibility among enterprises to curb corruption in society at large. Large corporations have banded together to fight corruption, even allocating a portion of their income to an “anticorruption” fund.
At the helm of any company are the CEO, owner, senior executives and managers. Employees see them as the leaders, “providers” and “guardians” in what many call their “second home.” As such, employees emulate the boss’s deeds and ways.
To an employee who is asked by the company owner to hand over bribe money to a government agency, this unethical action is deemed acceptable. A sales manager sends a wrong signal to a salesman when he tells him or her to “do whatever is necessary” to close the sale, even if it means bribing the buyer.
In the societal microcosm of the organization, these unethical signals from the leaders mold the organizational culture, which continuously influences the behavior of employees.
Leaders and managers of an organization must, therefore, set an example for employees. They should demonstrate such core values as honesty and integrity in their dealings with government and customers alike. They should encourage employees from all levels to participate in rule-making within the organization which will promote responsibility and accountability. Operationally, they should plan ahead to account for the normal delays in government processes, thereby avoiding the pressure to resort to bribes.
Company leaders should also be prepared to appeal to the sensible judgment of responsible government officers when the processing of legitimate requests is unduly delayed.
Many organizations have a code of ethics, which includes how to handle gift-giving and dealings with government agencies. Are they really being followed? A code of ethics should be embraced by the whole organization and seen in the conduct of the leaders and employees, and not just framed for hanging in hallways and offices.
Managers and employees should be allowed to openly and safely discuss ethical issues and concerns in the organization. Guided by the company’s guidelines, such discussions will result in creative approaches to handling most ethical dilemmas. In fact, a lot of companies have integrated ethical decision-making dimensions such as “ethical gift-giving and accepting gifts” in performance appraisals.
In summary, ethical conduct should be an integral part of the organizational culture—a culture of honesty and integrity. If organizations promote and embrace such a culture, then we can still hope to reverse the culture of corruption in our society.
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Reynaldo Lugtu Jr. is a student in the doctor of business administration program and a lecturer in management principles under the MBA program of the Graduate School of Business, De La Salle Professional School. He is a business executive at an IT services company. He may be e-mailed at rlugtu2002@yahoo.com.
Foreign businessmen rank the Philippines as the second most corrupt country in Asia, according to a recent survey conducted by Political and Economic Risk Consultancy Ltd. (PERC), a Hong Kong-based consultancy group.
Also, previous studies by the Asian Development Bank (ADB) and Transparency International have placed the Philippines among the most corrupt countries in terms of the magnitude of irregular payments, including bribery, in public contracts.
The historical background as well as the ramifications of corruption in the country has been discussed extensively in print and television. There is no doubt that it stifles investment and economic growth in the country.
Given the large amount of evidence about the corruption problem, why is the progress against it moving at a snail’s pace?
An explanation is that corruption is pandemic—that it is culturally ingrained. A study in 2002 by the Philippines Jesuits, which led to a book entitled Cross-Sectoral Study of Corruption in the Philippines, noted that the poverty in the country is “inextricably linked” to corrupt practices that are deeply rooted in the Philippine society. This “culture of corruption” is described as one of “crippling submissiveness of socially reinforced incapacity to do anything about corruption.” Corruption is so haunting and prevalent because society condones it.
In particular, the private sector is not without blame. As a frequent source of bribes for public officials, the private sector shares responsibility for this culture. The ADB study mentioned that enterprises resorted to bribery in obtaining government permits and extracting contracts.
How can the private sector help in nipping the spread of this culture right at the bud? The answer lies in how companies promote ethical conduct and values in the workplace. With employees and workers spending at least forty-hours-a-week in the workplace, surely the organization has a strong influence in how they behave.
It is encouraging that there has been stronger focus on social responsibility among enterprises to curb corruption in society at large. Large corporations have banded together to fight corruption, even allocating a portion of their income to an “anticorruption” fund.
At the helm of any company are the CEO, owner, senior executives and managers. Employees see them as the leaders, “providers” and “guardians” in what many call their “second home.” As such, employees emulate the boss’s deeds and ways.
To an employee who is asked by the company owner to hand over bribe money to a government agency, this unethical action is deemed acceptable. A sales manager sends a wrong signal to a salesman when he tells him or her to “do whatever is necessary” to close the sale, even if it means bribing the buyer.
In the societal microcosm of the organization, these unethical signals from the leaders mold the organizational culture, which continuously influences the behavior of employees.
Leaders and managers of an organization must, therefore, set an example for employees. They should demonstrate such core values as honesty and integrity in their dealings with government and customers alike. They should encourage employees from all levels to participate in rule-making within the organization which will promote responsibility and accountability. Operationally, they should plan ahead to account for the normal delays in government processes, thereby avoiding the pressure to resort to bribes.
Company leaders should also be prepared to appeal to the sensible judgment of responsible government officers when the processing of legitimate requests is unduly delayed.
Many organizations have a code of ethics, which includes how to handle gift-giving and dealings with government agencies. Are they really being followed? A code of ethics should be embraced by the whole organization and seen in the conduct of the leaders and employees, and not just framed for hanging in hallways and offices.
Managers and employees should be allowed to openly and safely discuss ethical issues and concerns in the organization. Guided by the company’s guidelines, such discussions will result in creative approaches to handling most ethical dilemmas. In fact, a lot of companies have integrated ethical decision-making dimensions such as “ethical gift-giving and accepting gifts” in performance appraisals.
In summary, ethical conduct should be an integral part of the organizational culture—a culture of honesty and integrity. If organizations promote and embrace such a culture, then we can still hope to reverse the culture of corruption in our society.
---------
Reynaldo Lugtu Jr. is a student in the doctor of business administration program and a lecturer in management principles under the MBA program of the Graduate School of Business, De La Salle Professional School. He is a business executive at an IT services company. He may be e-mailed at rlugtu2002@yahoo.com.
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