No more greasing palms or your hands will be cuffed

WE are in the midst of a bumper crop of probes and court cases revolving around corruption. And often, companies are linked to the allegations and charges. The typical connection is that these companies are said to be the sources of corrupt gratification.

None of us should be surprised by that. How many times have we heard that someone has greased another person’s palm in order to get ahead in business – to gain a customer, clinch a deal, secure an approval or escape enforcement?

Many people insist that bribery is a reality of doing business in Malaysia. But this year, reality has changed in two ways that ought to reshape such thinking.

On May 9, Pakatan Harapan won the mandate to run the country. In its election manifesto, the coalition says it will weed out corruption and “ensure that everyone involved in corruption will be brought to justice”.

It is a huge promise. Nevertheless, the rakyat demands maximum effort on this front, although nobody believes that we will wake up tomorrow to a corruption-free Malaysia. The second major development came about a month before the 14th General Election. Parliament passed a Bill containing amendments to the Malaysian AntiCorruption Commission Act. The game changer here is the insertion of Section 17A, the so-called corporate liability provision.

The new provision says a corporation or a partnership commits an offence if a person associated with it offers or gives a bribe to benefit the organisation. In this context, the person can be a director, a partner, an employee or somebody who provides services for or on behalf of the corporation or partnership.

That’s not all. When a commercial organisation commits an offence, its leaders (directors, partners or top managers) are deemed to have committed that offence as well.

The only way out is to prove that they had not known about the offence and that they had done all they could in their respective roles to prevent such an offence.

The penalties are no slaps on the wrist. A convicted offender faces a fine of not less than 10 times the bribe, or RM1mil, whichever is higher. Alternatively, he can be jailed for up to 20 years. Or he can be fined and imprisoned.

The companies and partnerships can also avoid conviction if they show that they have put in place “adequate procedures” to prevent an offence under Section 17A. The government will issue guidelines on these procedures.

It has to happen sooner rather than later because it will surely take time for the business world to realise the gravity of the corporate liability provision, digest the guide- lines and figure out how to adhere to the requirements.

Although the amendments were gazetted in May, Section 17A is expected to come into force only in 2020. So yes, there will be no crackdown yet on corporate bribery.

But it is foolish and foolhardy for businessmen in Malaysia to believe that they can continue for long to try beating their competitors by handing out bribes.

Things have changed and this idea of bribes as a business lubricant must be abandoned. Companies that do not operate with integrity and fairness will either end up in legal trouble or will find it increasingly hard to attract quality customers, vendors and talent.

Either way, corruption is a costly option.