Despite the giving and receiving of bribes being wholly illegal in the United Kingdom, such practices are considered commonplace in other nations across the world. The received wisdom is that paying bribes and going along with corrupt business practices makes trading easier and quicker, but are there long term consequences to engaging in such activities?

In the unlikely event you can find someone willing to talk about their experiences with bribery, they will point out that there are always two parties involved in backhanders. They will also point out that although illegal transactions can work initially, they also entail a number of risks.

Loss of Profit
Simply put, a bribe eats directly into profitability, both in terms of money paid out and in time spent arranging for the payment of the bribe. Diverting resources to arranging and paying bribes is inefficient and introduces bottlenecks into the supply chain.

Moral Issues
Advocating questionable ethics by paying bribes adversely affects the attitudes and ideals of employees involved in the process. If your business thinks it is ok to act illegally, surely it is therefore ok for employees to act illegally in any other aspect of your business’ dealings?

Legal Issues
Paying bribes is by definition, illegal. Businesses that pay or take bribes risk prosecution and imprisonment of personnel, both of which are extremely costly.  Not to mention legal fees.

Brand Image Issues
The adverse publicity surrounding bribery trials also has the potential to irreparably damage your brand name. The wider fallout from a bribery scandal and prosecution has the potential to permanently damage a brand, potentially bankrupting your business and also those of your suppliers and customers.

The risks associated with bribery escalate in severity and should therefore be carefully mitigated by supply chain managers to prevent large problems for their business. Check out Corruption, Bribery and Your Supply Chain Part 2 to find out what you can do to root out fraudulence.

About Celtrino

Celtrino is a well-established provider of hosted supply chain management and electronic invoicing services to businesses across Europe and the rest of the world from its headquarters in Dublin, Ireland. Building upon more than 200 years’ experience in supply chain automation, Celtrino staff develop and supply services designed to improve the workflow, efficiency and profitability of their 1200+
customers.
Celtrino uses industry standard cloud architecture to underpin its hosted e-business solutions, allowing worldwide clients to benefit and perform B2B transactions globally, irrespective of local limitations. Regardless of company size, Celtrino’s clients are able to access enterprise-level functionality, providing them with all the tools required to compete actively on the global stage.