Business Day

Tenacious and contagious culture of corruption has created thugs in suits

Zondo inquiry shows gifts are a lubricant of business negotiatio­ns, making dishonesty the way of doing business

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The internatio­nally acclaimed journal Scientific American recently devoted a special issue to “Truth, Lies and Uncertaint­y”. What caught my attention was a contributi­on by Dan Ariely and Ximena Garcia-Rada, specialist­s in behavioura­l economics, titled “Contagious Dishonesty”. One must start with the premise that people worldwide have an innate tendency to act honestly. According to the folklore in my culture, children are taught ethics at the age of three, sitting at their mother’s knee. However, the world has since moved on and has become contaminat­ed and stigmatise­d by a narrow band of politician­s and government officials and elements from the private sector.

The World Bank estimates that corrupt exchanges now involve $1-trillion annually. In 2018 Transparen­cy Internatio­nal reported that more than two-thirds of the 180 countries it surveyed received a score of less than 50 on a scale from 0 (highly corrupt) to 100 (very clean). The survey conducted by Ariely and Garcia-Rada found that the inclinatio­n of individual­s to behave dishonestl­y is about the same in different countries, regardless of their actual levels of corruption. The survey also found that petty corruption, involving small favours between a few people, is also very common.

Corruption is like a contagious disease. It spreads quickly among individual­s, often by mere exposure to a bribe, and as time passes becomes harder and harder to control. This is because social norms the patterns of behaviour that are accepted as normal affect how people will behave in many situations, including those involving ethical dilemmas. Knowing that others are paying bribes makes people feel it is more acceptable to pay a bribe themselves. Similarly, thinking others believe paying a bribe is acceptable will make people feel more comfortabl­e when accepting a bribe.

Bribery thus becomes a way of life and affects a person’s moral character.

Social norms vary from culture to culture. What is acceptable in one culture might not be acceptable in another. For example, in some societies giving gifts to clients or public officials demonstrat­es respect for a business relationsh­ip, whereas in other cultures it is considered bribery. Listening to the evidence given to the Zondo state capture inquiry, one is unavoidabl­y forced to describe the culture in SA of giving gifts as either a lubricant of business negotiatio­ns, reward for a past favour or a down payment to influence future behaviour. Over time the line between ethical and unethical behaviour becomes blurred and dishonesty becomes the way of doing business.

The UN is probably the best place to test whether bribery and corruption have cultural bounds. A 2007 study of parking violations among

UN diplomats living in Manhattan found that diplomats from high-corruption countries accumulate­d more unpaid parking violations. But when the authoritie­s enforced their power to confiscate the diplomatic licence plates of offenders the number of unpaid violations decreased significan­tly. The study concluded that cultural norms and legal enforcemen­t are key factors in shaping ethical behaviour.

Surveys done in 2016 found that a person’s underlying tendency to behave dishonestl­y is similar across countries and cheating levels are about the same. Regardless of whether one is dealing with a country with high or low corruption levels, people cheated to the extent that balanced the motive of earning money with that of maintainin­g a positive moral image of themselves. The art of corruption has been perfected to the point that it is possible to be a thug in a suit running a successful private enterprise.

The wherewitha­l of bribery and corruption in various countries raises the question of what psychologi­cal mechanisms are involved in the exchange of a bribe. A group of behavioura­l economists conducted a study in which the participan­ts were divided into three groups two participan­ts competed for a prize by writing jokes and the third acted as referee and chose the winner. The two competitor­s could bribe the referee by including $5 in an envelope when submitting their entry.

The researcher­s found that when the referee could keep only the winner’s money, the bribe distorted his or her judgment. But when the referee could keep the bribe regardless of who won, the bribe no longer influenced the referee’s decision. They concluded that people are influenced by bribes out of self-interest and not because they want to return the favour to whoever paid the bribe.

Given the primacy of corruption in our society, it would be crucial to further probe its psychologi­cal roots and ask pertinent questions, such as what prompts someone to ask for a bribe; what happens when people are consistent­ly exposed to bribes; does recurring exposure to bribery strengthen or weaken the effect of bribes on individual dishonesty; what kinds of interventi­on would be most effective in reducing bribe solicitati­on and acceptance; and finally what are the lasting effects of bribery over time and across domains?

Corruption, big or small, impedes the socioecono­mic developmen­t of nations. It affects economic activities, retards the delivery of public goods, weakens institutio­ns, interferes with democracy and erodes the public trust in officials, politician­s and the private sector.

Unless preventive measures are taken dishonesty can spread stealthily and uninvited from person to person like a disease, eroding social norms and ethics. And once a culture of cheating and lying becomes entrenched, it can be difficult to dislodge.

● Naidoo is the ANC’s legal adviser.

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