Keeping clean
Foreign companies operating in China face the dual challenge of winning business in a highly competitive environment while at the same time conforming to both domestic and international laws against corruption and fraud. An effective ethics and compliance programme is an essential ingredient of success
Issue: February 2010
Keywords (click to search):
corruption
compliance
fraud
risk
A common pleasantry in business circles is to suggest that the company legal or compliance department should be renamed “the business prevention department”. This joke has a degree of truth: business deals based on malfeasance should indeed be prevented. However, the more important truth is that companies that can confidently apply ethical principles throughout their organisations are better placed to seize opportunities with confidence. Integrity pays.
This principle applies with particular force in a country such as China, which is going through a long-term process of legal and governance reform. The need to be seen to combat bribery is a strategic requirement for the Chinese government and, while much of the focus has been on government officials, the authorities have begun cracking down on commercial corruption (albeit somewhat selectively). As if that were not enough, international companies face the double challenge of complying with their own countries’ laws which –...
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