FACULTY OF EDUCATION AND LANGUAGES
MAY 2013
OUMM3203
PROFESSIONAL ETHICS
STUDENT NAME
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LECTURER NAME
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BATU PAHAT
CONTENTS
CONTENTS
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1.
Introduction
1
2.
Economic Analysis On The Act Of Bribery
4
3.
Legal Analysis On The Act Of Bribery
6
4.
Ethical Analysis On The Act Of Bribery
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5.
Conclusion
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References
1.
INTRODUCTION
Bribery can be defined broadly as the receiving or offering/giving of any benefit (in cash or in kind) by or to any public servant or office holder or to a director or employee of a private company in order to induce that person to give improper assistance in breach of their duty to the government or company which has employed or appointed them. An occasion where such assistance might be sought would be in relation to the award of an export contract where a bribe might be used to influence the tendering process. Bribes may also be paid to individuals who, although not holding an appointment in a relevant company or national government, are nevertheless able to exert influence over such an appointee by reason of some personal, business or other relationship. Bribes may be paid in advance, as an inducement to a person to act improperly, or retrospectively pursuant to a previous promise, understanding or agreement.
According to Zaharuddin bin Abd. Rahman (2008), bribe is wealth earned by accomplishing a task for a party that should have been done without any compensation (whether to bring benefit to the party or to avoid harm). In some situations, bribery is similar to tips or rewards and distorted by some people who say that ‘this is not bribery, but a reward'. Bribery can be define as money, donation, loan, fee, gift, expensive collateral, properties (moveable or immovable), rights in properties or any other similar benefits; any positions, titles, designations, jobs, contracts or services, and promise for any type of job or service; any payments, exemptions, settlement of loans, obligations and liabilities either in whole or in part; any type of compensation, discount, commission, rebate or bonus; any action that prevents oneself from claiming any money or monetary value or luxurious items; any type of service or help such as protection from any penalties, disciplinary penalties, civil or criminal charges. This includes using one's authority or preventing from using one's authority to provide that protection; and any offers or promises, with or without conditions, to give bribes such as any of the above items. According to Malaysian Law, Section 2 Anti-Corruption Act 1997 (act 575), it defines bribery as any money, donation, loan, fee, present, down payment, property or the interest of the property, that is any type of property whether moveable or immovable, or any benefit to that, given to someone to do something which is illegal.
Bribery is one of the oldest practices in the history of mankind, and it seems that the oldest archaeological proof regarding bribes is a 3400 years old clay tablet, discovered by a 1
team of Dutch researchers on the territory of what used to be the Assyrian empire, on which a list of the "employees who took bribes" is imprinted. According to the worldwidewords.com website, the word itself starts in medieval French, where bribe meant "a piece of bread". A linguistic game of consequences led the sense from this to "a piece of bread given to a beggar", then more generally to "alms" and "living upon alms", to "begging" and so to associations with mendicancy and vagabondage. It was with the last of these senses that the word first appeared in English in the fourteenth century, in the works of Chaucer and his contemporaries. It soon evolved further to take in the idea of extortion, or demanding money with menaces. Only in this usage did bribe finally come to mean a sum of money, though at this time briber meant the person doing the menacing and so getting the money. The worst offenders were often judges and public officials, who extorted money from claimants in order to pass down a favorable outcome.
It was in the sixteenth century that the meaning flipped completely over so that briber meant instead the person handing over the money. Nobody seems to know quite how this happened. In the process, bribe changed to mean a supposedly voluntary inducement instead of something extracted by force, thus arriving at the sense which it has retained ever since. Nowadays, bribery is taking different shapes, adapted to the national culture. Western countries have lower levels of corruption (at least low-level corruption, among doctors, lawyers, judges etc.), but top-level corruption is still present, although very well hidden between all kinds of contracts and more or less legal business deals.
However, in Eastern-Europe, the Middle East and some of the Asian countries, bribery is much more widespread, being present at all levels. And the main reason behind this situation is the fact that these people have what could be described as a "bribe-culture", meaning that they've become so used to the idea of offering bribes in order to obtain some favors (or simply get things done), that they don't imagine the world otherwise. (Stefan Caragae, 2006).
Bribery encompasses three types of illicit deal: proprietary, bureaucratic, and lettingoff. Proprietary bribery features a government’s agent who grants a governmental contract or franchise to a person (or firm) and receives money or its equivalent in return. The briber bypasses the competition with other bidders and obtains from the agent a favorable off-market deal with the government. The agent thus helps the briber to steal from the government in 2
exchange for money or its equivalent. Bureaucratic bribery involves no theft. Instead, it expedites the briber’s acquisition of an official permit, license, or document. The briber can obtain the required permit, license, or document lawfully by following certain procedures or by waiting in the applicants’ queue. The briber, however, chooses to act unlawfully: He pays the government’s agent for the red tape’s removal or for bypassing the queue.
In this
scenario, no one may actually get hurt. The agent does not give the briber a permit, a license, or a document that the briber was not supposed to receive from the government. Law biding citizens queuing for the government’s permits, licenses, and documents endure no delays either. Under the bureaucratic bribery scenario, the agent issues their permits, licenses, and documents properly and at a scheduled time. At the same time, he introduces a private improvement in the functioning of the government’s agency by making it more productive. Ideally, of course, it is the government that should make such improvements, but the government does not know it can improve the agency’s productivity (or does not care about improving the agency’s work). The agent exploits the government’s ignorance (or indifference) by introducing the improvement privately at the briber’s expense, while capturing its economic value (the bribe). The third and final variant of bribery is letting-off— a deal involving a law-enforcement agent who allows his briber to break the law and go unpunished (after paying the agent).When the agent sabotages the government’s enforcement effort, the government suffers a tangible deprivation. The briber’s deal with the agent consequently becomes similar to proprietary bribery. The government’s enforcement and deterrent capacity, however, will not always be eroded as a consequence of such a deal. Consider a government that rations its enforcement effort by requiring its agents to enforce the law against eighty percent of the violators. The agent collects bribes from twenty randomly chosen violators out of one hundred and lets them off, while meticulously enforcing the law against the remaining eighty violators. In this scenario, the government gets what it pays the agent for, while the agent delivers on his undertaking to the government. Moreover, twenty violators that the government was ready to let off completely are now paying a private “violation tax” to the agent. As a result, violators are better deterred overall than under the government’s plan. (Alex Stein, 2012).
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2.
ECONOMIC ANALYSIS ON THE ACT OF BRIBERY
Bribery and corruption can have various negative impacts. Bribery is known to distort markets and the allocation of resources by manipulating prices of products and services. Bribery can also adversely affect the economic and social development of countries by deterring long-term foreign and domestic investments, enhancing inflation and thereby depreciating national currencies and reducing expenditure on education and health. (Paul Mauro, 1997). Large, off-the-book payments to public officials or intermediaries may prove to be a significant financial burden for a company and call into question the performance of its duties to its stakeholders. Adverse publicity can significantly damage the company’s reputation, which may in turn result in restricted access to markets or difficulties in raising capital. (Aerospace Daily & Defense Report, 2007). Companies may benefit with short-term gains but at the possible cost of long-term profitability. These elements have significant implications for the shareholders of companies and the risk profile of investment portfolios. Governments and international organisations have sought to eliminate corrupt practices frombusiness activities and introduced several codes to address the issue.
In 2008, the Government and Parliament agreed that the The Malaysian antiCorruption Commission (MACC) be established in order to enhance the effectiveness and efficiency of nationwide anti-corruption efforts, as well as to improve the perception of independence and transparency of the functions of the Commission. MACC began its operation officially on January 1, 2009, replacing the Anti-Corruption Agency (ACA) malaysia. it was established by legislation, namely the malaysian Anti-Corruption Commission Act 2009 (Act 694). Under the National Key Result Areas' (NKRA) anti-graft initiatives, in 2012 Malaysia improving its standing in the Corruption Perceptions Index (CPI) when it shot six spots up to 54th position from last year's 60.It was a marked improvement from 2011 when the country fell four places down from 2010's 56th position.Transparency International-Malaysia (TI-M) revealed that out of the 176 countries involved in the CPI survey last year, Malaysia also ranked third among Asean countries, ahead of Thailand, Philippines and Indonesia.The three countries ranked 88th, 105th and 118th respectively. Singapore, which was placed third in the world, was the top anti-graft performer in Asean, followed by Brunei at 46.Malaysia scored 49 out of 100, with 0 being the most corrupt and 100 corruption-free. Although Malaysia's 2012 TI CPI score of 49 out of 100 cannot be compared with the past TI CPI scores of the past 17 years from 1995 to 2011, Malaysia is 4
clearly below average in international rankings and scores. Since 1995 Malaysia has been overtaken by South Korea and Taiwan while many countries are closing the corruption gap, especially Turkey which was ranked No 29th with a CPI score of 4.1 in 1995, but which has caught up with Malaysia with both equally ranked at No. 54 with a score of 49 in the 2011 TI CPI. Table 1: Malaysia's CPI ranking, score and total number of countries in sample, 2001 to 2012
Year
2001 2002 2003 2004 2005 2005 2007 2008 2009 2010 2011 2012
Ranking
36
33
37
39
39
44
43
47
56
56
60
54
Score
5
4.9
5.2
5
5.1
5
5.1
5.1
4.5
4.4
4.3
49
Total No. of Countries 91
102 133 145 158 163 179 180 180 178 183 176
Table 2 : Malaysia’s TI CPI ranking and score from 1995 to 2011
Year CPI Rank CPI score 2001
36
5.0
2002
33
4.9
2003
37
5.2
2004
39
5.0
2005
39
5.1
2006
44
5.0
2007
43
5.1
2008
47
5.1
2009
56
4.5
2010
56
4.4
2011
60
4.3
* 10 (highly clean) and 0 (highly corrupt), Indeed, one should not take too much comfort in the fact that Malaysia improved in the ranking because it overtook "luminaries" of "clean" government such as Jordan, Namibia, Oman, Kuwait and Saudi Arabia. Indeed, many developing countries that have far lower per capita GDP compared to Malaysia continues to do better than us in the CPI rankings including Rwanda (50), Bhutan (33) and Botswana (30), not to mention the newly industrialized economies (NIEs) in Asia namely South Korea (45), Taiwan (37), Hong Kong (14) and 5
Singapore (5). More worryingly, the three major thrusts of the Fighting Corruption National Key Results Area (NKRA) under the Government Transformation Program (GTP) - namely, to strengthen the anti-corruption enforcement agencies and legislation, to tackle grand corruption and to reduce leakages from government procurement - continue to have gaping holes when it comes to delivery and execution. For example, the Malaysian Anti-Corruption Commission remains very much a toothless tiger which is dependent on the Attorney General to prosecute cases. The PKFZ RM12.6 billion scandal - namely former Transport Ministers Ling Liong Sik and Chan Kong Koy - have not been properly concluded leading one to wonder if these cases will follow in the footsteps of the cases against former Sabah UMNO Minister, Kasitah Gaddam, and former Perwaja chairman, Eric Chia, both of whom were charged with corruption with great fanfare prior to the 2004 general election but who were both subsequently released. And as long as the MACC is not independent or seen as independent, even legislation such as the Whistleblowers Protection Act will not have any substantive long term effect on reducing corruption.
3.
LEGAL ANALYSIS ON THE ACT OF BRIBERY
Malaysia‘s main bribery offences are found in the Malaysian Anti Corruption Commission Act (MACCA). MACCA Sections 21 and 22 deal with domestic and foreign bribery respectively. Additional (and more dated) domestic bribery offences are found in the Penal Code (PC). Passive domestic bribery is covered by Sections 161 (public servant taking a gratification) and 165 (public servant obtaining a valuable thing without consideration). Active bribery constitutes an offence of a betting a public servant to commit passive bribery (PC Sections 109 and 116) covers active domestic bribery. According to Malaysian authorities, bribery offences are generally prosecuted under the MACCA rather than the PC.
Bribery may also be covered by other corruption offences such as accepting gratification to induce a public official (MACCA Section 16, and PC Sections 162 and 163), bribery of agents (MACCA Section 17), and using office or position for gratification (MACCA Section 23). Additional statutes may cover bribery of specific types of officials.
3.1
ELEMENTS OF THE ACTIVE AND PASSIVE DOMESTIC BRIBERY
OFFENCES. 6
International standards require active bribery offences to expressly cover giving, offering or promising a bribe. MACCA Section 21 only refers to offering a bribe, not giving or promising. By contrast, the MACCA accepting gratification (Section 16) and foreign bribery (Section 22) offences expressly cover giving, promising and offering. This would suggest that “offer does not include giving and promising. Otherwise, promising and giving in Sections 16 and 22 would be redundant. As for the PC, active domestic bribery is covered indirectly through the crime of abetment; there is no specific offence of active bribery. Abetting bribery arguably covers at least some types of offering and promising a bribe, e.g. a bribe that is offered but rejected constitutes abetting bribery. However, it is unclear whether a bribe that is offered but not received by an official is an offence. Malaysia states that Section 21 MACCA covers these situations but did not provide supporting case law. In any event, criminalising active bribery through the abetment offence falls short of international standards. International instruments require giving, offering, and promising bribes to be full, complete offences.
A general offence of abetting the commission of a crime does not meet this standard. Furthermore, all three modes of active bribery are of equal gravity. That is not the case in Malaysia, since abetting bribery attracts lighter punishment than the full offence (see below). Turning to passive bribery, three offences are applicable. First, MACCASection 21 deals with officers of public bodies who solicit or accept a gratification as an inducement or reward for certain acts. Second, Penal Code Sections 161 covers a public servant who accepts or obtains gratification as a motive or reward for a certain act. This act, however, does not in fact have to be performed; it is sufficient if the official represents that the act has been or will be performed.
Third, Section 165 may apply to passive bribery under certain circumstances. It covers a public servant who accepts, obtains etc. any valuable thing without consideration or for inadequate consideration from a person concerned in any proceeding or business transacted by the public servant. Mere acceptance of the valuable thing suffices; there is no further requirement that the thing was a motive or reward for the recipient official‘s acts.
Section 165 is thus broader than Section 161 in this regard. But from another perspective, it is narrower as it only applies to bribers who have proceedings or business involving the bribed 7
official, or a connection with the official‘s functions. There is no such limitation to Section 161. International standards require passive bribery offences to cover accepting and soliciting a bribe. MACCA Section 21 clearly meets this requirement. PC Sections 161 and 165 contain the words “accept or obtains, agrees to accept, or attempts to obtain”. Soliciting is not expressly covered, but may be considered an attempt to obtain.
International standards
require coverage of bribery through intermediaries. PC Section 165 covers bribes “from any person whom [the official] knows to be interested in or related to the [briber] so concerned.
On the other hand, MACCA Section 21 and PC Section 161 do not expressly refer to intermediaries. Comparison can again be made with the MACCA Section 22 foreign bribery offence, which expressly covers a person who by him/herself “or by or in conjunction with any other person” gives, offers or promises an official a bribe. The additional language in the foreign bribery offence suggests that MACCA Section 21 and PC Section 161 may not cover bribery through intermediaries. There is also uncertainty and inconsistency regarding bribes given to third party beneficiaries. MACCA Section 21 does not contain language to this effect, unlike the offences of foreign bribery (Section 22) and accepting gratification (Section 16). PC Sections 161 and 165 meet this requirement by expressly referring to officials who accept, obtain etc. a bribe “for himself or forany other person”.
The MACCA covers bribery of “officers of a public body. This is defined as a member, officer, employee or servant of a public body, and includes a member of the administration, member of Parliament, member of a State Legislative Assembly, judge of the High Court, Court of Appeal or Federal Court, and any person receiving any remuneration from public funds, and a person who is incorporated as a corporation sole that is also a public body. A public body includes the federal government, state government, local authorities, and their departments, services and undertakings. Also included are companies or subsidiaries over which a public body has controlling power or interest, and various registered societies and trade unions. While this definition is broad, judges of Magistrates‘ and Sessions Court are notably missing. Some may argue that these judges are covered as “persons receiving remuneration from public funds. But this would beg the question of why judges of other courts (and indeed most other enumerated officials) are expressly mentioned in the definition. According to Malaysian authorities, “officers of public bodies does not include the King or Sultans of Peninsular Malaysian states, but does include members of the government of the
8
federal territory of “WilayahPersekutuan. The Malaysian authorities were unsure whether the definition covers Governors of Sabah and Sarawak in East Malaysia.
The PC takes a rather different approach by listing a series of relatively narrow functions performed by officials. Section 21 defines a “public servant by enumerating several specific categories of officials. These include commissioned military officers; judges, jurors, arbitrators, and other persons empowered by law to perform adjudicative functions; court officers charged with certain duties, such as investigations; officials responsible for preventing offences, bringing offenders to justice, or protecting public health, safety and convenience; officials dealing with the Government‘s pecuniary interests, property, contracts, or revenue; and officials assessing or levying taxes. The PC definition of “public servants also falls short of international standards. Persons holding legislative office are clearly missing. Noncommissioned officers and lower ranked military personnel are not covered. There is no mention of public agencies and public enterprises. Some categories also cover only officials of “the Government, which is defined as “the Government of Malaysia and of the States and any person lawfully performing executive functions of Government under any written law (PC Section 6).
Malaysia's bribery offences appear to be narrower. MACCA Section 21 covers an official who (a) votes or abstains from voting in a public body; (b) performs or abstains from performing any official act ; (c) votes for or grants a contract; or (d) shows favour or disfavour in his/her capacity as a public officer. All four means of committing the offence refer to acts within the official‘s competence. PC 161 also has shortcomings in this respect. The offence deals with a public servant who (a) does or forbears from doing any official act ; (b) shows favour or disfavour to any person in the exercise of his/her official functions; or (c) renders any service or disservice to certain public officials.
Arguably, only category (c) deals with acts outside the official‘s competence, but it may fall short of international standards in two respects. First, it is unclear whether”rendering a service or disservice” to another official includes using one‘s office to make another official perform the act for which the bribe was intended. Second, the definition does not seem to cover an official who acts outside his/her competence and uses his/her office to influence a private individual. On the other hand, PC 165 may cover acts outside the official‘s competence. The offence merely requires an official to accept a thing with 9
inadequate or no consideration from someone who has dealings with the government. The offence is unconcerned with what act, if any, the official performs as quid pro quo for the thing received. International standards require coverage of bribes of both a monetary and non-monetary nature. The term “gratification” in the PC is not restricted to pecuniary gratifications, or to gratifications estimable in money.
The MACCA contains a lengthy definition of “gratification that includes both monetary and non-monetary things, such as employment, office, service or favour. Both statutes therefore cover non-monetary bribes. PC Section 165 deals the giving of “any valuable thing to an official; it thus appears to cover only things of value and not all nonmonetary benefits. Neither the PC nor the MACCA, however, indicates whether an offence of bribery is committed regardless of the value of the “gratification, i ts results, the perceptions of local custom, the tolerance by local authorities, the alleged necessity of the bribe, or whether the briber is the best qualified bidder. Malaysian authorities assert that the value of a gratification is not a consideration in the prosecution of offence for bribery under MACCA. No supporting authority was provided.
The MACCA Part VI allows certain inferences to be drawn when proving some elements of the bribery offences. The mere giving, accepting etc. of a gratification raises a rebuttable presumption that the gratification was an inducement, reward or motive for the official‘s act or omission. The acceptance of a valuable thing also raises a rebuttable presumption that the recipient
The PC and MACCA do not contain specific defences to
domestic bribery. There are no defences of solicitation, small facilitation payments (i.e. payments to officials to induce them to perform non-discretionary routine tasks such as issuing licenses or permits), or “effective regret” (i.e. an offender who voluntarily reports his/her crime to the authorities).
3.2
BRIBERY OF FOREIGN PUBLIC OFFICIALS
MACCA Section 22 criminalises active and passive foreign bribery. The language of the offence follows that found in international instruments fairly closely, and thus the offence already meets many aspects of international standards. For example, the offence covers all the essential modes of the offence (offer, promise, give, solicit and accept a bribe), as well as bribery through intermediaries and bribery that benefits third parties. The offence is not 10
limited to foreign bribery in international business transactions and hence goes beyond international standards in this respect. Nevertheless, it could be useful to clarify two aspects of the offence:
(a) The term “foreign public official” as defined in MACCA Section 3 does not clearly cover persons performing public functions for a public enterprise or public agency.The Malaysian authorities state that the definition is not exhaustive because Section 3 provides that “foreign public official” includes certain prescribed classes of officials. Even if this is correct, there remains no confirmation that the definition includes persons performing public functions for a public enterprise or public agency.
(b) There is no definition of a “foreign country”. Hence, it is unclear whether the term (i) includes all levels and subdivisions of government, from national to local, and (ii) is not limited to states, but includes any organised foreign area or entity, such as an autonomous territory or a separate customs territory.
3.3
LIABILITY OF LEGAL PERSONS FOR BRIBERY
In theory, Malaysia can impose criminal liability against legal persons for bribery. The MACCA and PC bribery offences apply to any person. For the MACCA, “person” includes a body of persons, corporate or unincorporated (Interpretation Acts 1948 and 1967, Section 3). For the PC, the same term“includes any company or association or body of persons, whether incorporated or not” (PC Section 11). Whether corporate criminal liability for bribery is actually imposed in practice is wholly unclear. There is no reported case law in which a company has been prosecuted for a criminal offence. Nothing in the Penal Code indicates when a company is considered to have committed a crime. There is no guidance on when the acts or omissions of a natural person may be attributed to a legal person, whose acts or omissions may trigger liability, or whether the conviction of a natural person is a prerequisite to convicting a legal person.
3.4
JURISDICTION TO PROSECUTE BRIBERY
PC Section 2 provides territorial jurisdiction to prosecute MACCA and PC bribery offences which are committed “within Malaysia”. The Malaysian authorities state that they 11
have jurisdiction to prosecute offences that take place “partly” in Malaysia. However, they did not provide supporting authority or legislation, or explain what part or how much of an offence must take place in Malaysia before territorial jurisdiction arises. Malaysia also has jurisdiction to prosecute its citizens and permanent residents for offences committed “without and beyond the limits of Malaysia”. Dual criminality is not required, i.e. the act or omission subject to prosecution need not be an offence at the place where it occurred (MACCA Section 66 and PC Section 4(1)(b)). Malaysia does not appear to have nationality jurisdiction to prosecute legal persons. As noted above, MACCA Section 66 and PC Section 4(1)(b) provides nationality jurisdiction to prosecute only “citizens” and “permanent residents”. Only natural and not legal persons can be “citizens”. “Permanent resident” is defined as “a person who has permission granted without limit of time under any federal law to reside in Malaysia, and includes a person treated as such under any written law relating to immigration” (Courts of Judicature Act1964, Section 3). This definition appears to contemplate only natural and not legal persons. The following table summarises the maximum available sanctions for the bribery offences in the PC, MACCA and the statutes that deal with bribery of specific types officials. (ADB/OECD Anti-Corruption Initiative for Asia and the Pacific, 2010)
Offences MACCA Offences Active and passive domestic
Maximum sentence available
bribery (MACCA Section 21)
MYR 10 000 (approx. EUR 2 000 or USD 3
Imprisonment of 20 years and a fine of (1)
000) or Active and passive foreign bribery (MACCA Section 22)
(2) at least five times the value of the gratification offered, promised or given, whichever is
higher PC Section 161 - Taking gratification in respect of an official act Passive domestic bribery (PC Imprisonment of three years and/or an Section 161) Active domestic bribery /
unlimited fine
abetment – Official accepts bribe (PC Sections 109) Active domestic bribery /
Imprisonment of nine months and/or an
abetment – Official refuses
unlimited fine
12
bribe (PC Sections 116) PC Section 165 – Obtaining valuable thing without adequate consideration Passive domestic bribery (PC Imprisonment of two years and/or an Section 165) Active domestic bribery /
unlimited fine Imprisonment of six months and/or an
abetment (Sections 109)
unlimited fine
4.
ETHICAL ANALYSIS ON THE ACT OF BRIBERY
Bribery has been described as ‘a practice involving the payment or remuneration of an agent of some organisation to do things that are inconsistent with the purpose of his or her position or office” (Adams and Maine, 1998, p. 49). When doing ethical analysis, there are four models that serve as a framework to structure an argument: utilitarianism in terms of actions, utilitarianism in terms of rules, rights & duties, and virtue. Utilitarianism is the process of weighing benefits and harms, and choosing the option that offers the most benefits for the greatest number of people. Rule-utilitarian thought focuses on benefits and harms created by rules, while act-utilitarian thought calculates the consequences of actions themselves. The rights & duties model chooses the course that respects what others are entitled to (rights) and obligations a stakeholders has to fulfill them (duties). The last model, virtue, chooses the option that enforces good habits of character for yourself and others. Each model can be applied when evaluating whether bribery is ethical or not. In terms of benefits and harms to the Malaysian economy, Malaysian firms will lose deals due to bribery. Where giving bribes is a common practice in procuring contracts, a firm or a company that does not offer bribes will clearly be at a disadvantage, at least in the short term.
According to Ida Lim (2012), Malaysia tops the list in a Transparency
International (TI) survey of 30 countries where companies felt they had lost deals because they did not pay bribes . It is likely to lose out to less scrupulous competitors in the battle for contracts. Suppose that such a company enunciates its policy clearly, and publicly calls attention to the corrupt practices of its competitors.
While this would probably be
counterproductive in the short run, the result may be to build up good will among the forces in the country that are fighting against corruption, Should those forces prevail, then the honest company is likely to be rewarded. In the worst case, it may be necessary to recognize that there are times when one must choose between immediate self-interest and ethical behavior. 13
Where corruption is so rampant that it is not possible to do business in an honest manner, then perhaps the most appropriate response is simply to refrain from doing business in that country. If this policy were widely adopted, then strong pressure for reform would be a likely outcome.
The most powerful argument against bribery is related to the virtue model. Bribery is a form of corruption that alters a behavior or outcome based on a reward. Rather than encouraging good habits of character, such as hard work and judiciousness, the action teaches individuals to cheat in order to get ahead. By using such a tactic to pay off debt, the Malaysian government is justifying to citizens that the ends justify the means. Such examples will likely lead to corrupt behavior within the Malaysian economy, because the government did not fulfill its duty of being a moral representation of the country it administers. If the government engages in bribery, what would stop business owners, politicians, lobbyists, and other stakeholders from doing the same?
5.
CONCLUSION
Bribery is an act of giving money or gift giving that alters the behavior of the recipient. Bribery encompasses three types of illicit deal: proprietary, bureaucratic, and letting-off. Bribery and corruption can have various negative impacts on Malaysia economy. In the recently released Transparency International’s Corruption Perception Index 2012, Malaysia’s ranking improved from 60 out of 183 countries in 2011 to 54 out of 176 countries in 2012. Nevertheless one must keep in mind that this ranking of 54 is still worse than Malaysia’s ranking of 43 out of 179 countries in 2007 and far worse than the ranking of 33 out of 102 countries in 2002 . More bold measures must be taken to eliminate corruption. To be effective, measures against corruption must therefore address to causes and not the symptoms. Emphasis must thus be placed on preventing corruption by tackling the root causes that give rise to it through undertaking economic, political and institutional reforms. Anti-corruption enforcement measures such as oversight bodies, a strengthened police force and more efficient law courts will not be effective in the absence of a serious effort to address the fundamental causes. Another observation that may be useful to bear in mind is that corruption is most prevalent where there are other forms of institutional weaknesses, such as political instability, bureaucratic red tape, and weak legislative and judicial systems. The 14
important point is that corruption and such institutional weaknesses are linked together and that they feed upon each other. For example, red tape makes corruption possible and corrupt officials may increase the extent of red tape so that they can get more bribes. So, getting rid of corruption helps a country to overcome other institutional weaknesses, just as reducing other institutional weaknesses helps to curb corruption.
Words (5492)
15
REFERENCES
Adams, D. M. and Maine, E. W. (1998). Business Ethics for the 21st Century. Mayfield Publishing Company.
ADB/OECD ( 2010).The Criminalisation Of Bribery In Asia And The Pacific Frameworks and Practices in 28 Asian and Pacific jurisdictions
Aerospace Daily & Defense Report (2007), Volume 222, Issue 62, 27
Alex Stein (2012). "Corrupt Intentions: Bribery, Unlawful Gratuity, and Honest-Services Fraud" Law & Contemporary Problems 75 : 61-81.
Ida Lim (2012). Malaysian firms lose deals due to bribery, TI survey shows (Online) http://www.themalaysianinsider.com/malaysia/article/malaysian-firms-lose-dealsdue-to-bribery-ti-survey-shows. (Accessed 7 July 2013)
Mauro, Paul (1997). Why worry about corruption. IMF Economic issues No. 6
SPRM. Laws of Malaysia Act 694. (Online) http://www.sprm.gov.my/images/webuser/files/static_content/act/SPRM_act_BI.pdf . (Accessed 7 July 2013)
Stefan Caragae (2006). Bribery, an Immortal Plague. http://news.softpedia.com/news/Bribery-an-immortal-plague-21543.shtml. (Accessed 7 July 2013)
Worldwidewords.com. (1997). Bribery (Online) http://www.worldwidewords.org/topicalwords/tw-bri1.htm. (Accessed 7 July 2013)
Zaharuddin bin Abdul Rahman (2008). Corruption and bribery will destroy our nation (Online) http://www.zaharuddin.net/. (Accessed 7 July 2013)
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