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Culturally appropriate gift-giving can, of course, easily slip into quid-pro-quo bribery, as frequently happens in Korea. Side payments are a constant temptation in a relationship-based system, because they are a shortcut past the slow and laborious process of building relationships based on trust.

The West has its own temptations. With our increasing reliance on rules and transparency, the power of relationships and personal authority in our culture has weakened over the years. With legal supervision relatively light, the system relies largely on voluntary compliance with ethical and legal norms. This makes for an efficient economy, but there is constant temptation to cheat or take shortcuts. That is corruption, no less than is bribery. Its effects are amply illustrated by the recent crisis in the Western financial system, when a few irresponsible players precipitated a global credit freeze.

Even bribery in West Africa can be seen as a responsible practice gone awry. In a traditional village context, African leaders earned respect by judiciously bestowing gifts and favors on their subjects. That wasn't simply a patronage system; it was also a form of rational redistribution. The chief channeled wealth where it was most needed, increasing the community's survival advantage. With the coming of colonialism and Western-style institutions, men frequently left villages to take government jobs in the capital. They continued to use gifts to obtain influence, but they left behind the social context that had structured and guided the practice. Responsible generosity became irresponsible influence peddling.

Business executives operating in Africa today should try to earn the influence they need through responsible generosity. They might build infrastructure or schools instead of paying off officials or political parties. There--and in general--the key to avoiding corruption is to understand what makes the local business culture work, and to stick to practices that reinforce the system, not ones that tear it apart.

John Hooker is a professor at the Tepper School of Business at Carnegie Mellon University. For a more detailed discussion of this topic, see his "Corruption from a Cross-cultural Perspective," in Vol. 16, Issue 3 of Cross-Cultural Management: An International Journal (2009). The Celtel experience is further described in the 2008 London Business School case study "Terry Rhodes," by A. Karim, T. Putimahtama, and J. Mullins. The LKK story is told in the 2005 IMD case study "Lee Kum Kee Co. Ltd.: The Family Recipe," by C. Lief and J. L. Ward.

 


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