Should Internal Corruption be allowed in Businesses?
Internal corruption can take different forms. For instance, a situation whereby the business management overvalues assets, implementation of false projects, devaluing stakeholder’s dividends or even using shortcuts when awarding tenders. While internal corruption benefits individuals in the firm, it has devastating effects on the overall business performance.
Primarily, internal corruption may profit the company’s customers, stakeholders and ensure a smooth running of business activities. In some cases, businesses spend less money when they use shortcuts in awarding tenders. Ideally, the standard tendering process takes a long time and involves the use of funds. Thus, if an alternative is used, the company can save resources and time. Evidently, corruption can help improve the status of a nation. This vice has helped most Third World countries to create a strong anticommunist rule.
Additionally, internal corruption can build consumer confidence. For instance, if the company management utilizes corrupt means to acquire cheap raw materials, customers stand to benefit from cheap products. Also, some clients can benefit from businesses that treat their customers differently according to their social status, or purchasing power. Ideally, China and Russia are likely to practice corruption with a bid of creating loyalty among customers (Transparency International, n. p.). In some companies, clients offer incentives to the management for favorable treatments.
Even though internal corruption seems to have some benefits, its impacts are tremendous in a particular business and also to the country’s economy. Importantly, the internal corruption involves the use of stakeholder’s money who suffers when their dividends are devalued. Most importantly, internal corruption impacts businesses negatively since it increases risks and uncertainties and thus, hinders economic development.
Furthermore, internal corruption costs companies millions of dollars globally and has become an ethical predicament. Business officials embezzle money that is not taxed and thus, affects the country’s GDP. Hence, corruption creates a significant financial gap between those receiving and the tax-paying workers and clients. Also, an organization that experiences internal corruption usually faces challenges when changing management. The reason is that the existing managers will corrupt their way into the positions.
Importantly, organizations have realized that the problems of internal corruption are major than its advantages. Thus, most businesses are examining the ethical issues related to internal corruption. Ethics in business refers to an environment where organizations adhere to laws and take actions that do not tarnish a company’s image (Pojman and Fieser pp. 1). Ideally, internal corruption goes against all these conditions.
Organizations should put measures in place to fight internal corruption. First, the hiring process should be stringent to ensure the business hires a qualified and ethical staff. Evidently, some organizations practice inside sourcing to ensure their employees are competitive. Second, a company should put measures in place to help monitor internal corruption. Computer monitoring software, phone recording, and surveillance cameras are some of the implementations that can help a business monitor internal corruption. Third, an organization can formulate rules to curb internal theft. Finally, strict actions should be taken when an employee practices internal corruption.
In the light of this paper, internal theft should not be permitted in businesses. Since corruption affects the particular company’s income and profits, all companies should put measures in place to curb it.
Conclusion
It is true that internal corruption has some benefits in the business operation. It can help benefit individual employees, stakeholders, customers or even the business. However, this vice has devastating impacts on an organization and also to its stakeholders. Business organizations should establish measures to end internal corruption in the organization, and ensure that this initiative is a continuous process, to avoid regeneration of this vice in the future.
Works Cited
Pojman, Louis P., and James Fieser. Ethics: Discovering Right and Wrong. 7th ed. Boston, MA: Wadsworth Publishing Co, 2011. Print.
Transparency International. “Corruption Perceptions Index 2015.” Transparency International. 2015. Web. Viewed on 27 Mar. 2016 from < http://www.transparency.org/cpi2015 >
