The fcpa and the oecd convention: Some lessons from the U.s. Experience [Book Review]

Journal of Business Ethics 93 (2):255 - 276 (2010)
Abstract
Although corruption is ubiquitous, attitudes toward it differ among countries. Until the 1997 OECD Convention, the U.S. had been one of the only two countries with an explicit extraterritorial anti-bribery law, the Foreign Corrupt Practices Act (FCPA) of 1977. The FCPA employs a two-pronged approach to control the supply side of corruption: (1) anti-bribery provisions; and (2) accounting (books and record and internal controls) provisions. I offer evidence, albeit indirect, to show that the FCPA had limited success. The OECD Convention adopts the same two-pronged approach, but, since it is a multilateral treaty, is likely to be more successful provided that enforcement is vigorous enough. The signatory nations effectively form a cartel to reduce the cost of doing business. As with any cartel, however, each multinational corporation has an incentive to deviate. Thus, the mutual enforcement of the agreement is crucial for its success. However, the two-pronged approach is not sufficient, since internal control does not adequately monitor decisions made at the top level. I argue that the two lessons drawn from the U.S. experience are: (1) law enforcement must be credible; and (2) internal controls alone are not sufficient. Stronger and more effective corporate governance within an appropriate regulatory framework is needed to ensure that multinational corporations conduct their business in an ethical manner.
Keywords bribery  cartel  corruption  corporate governance  FCPA  internal control  OECD convention
Categories (categorize this paper)
Options
 Save to my reading list
Follow the author(s)
My bibliography
Export citation
Find it on Scholar
Edit this record
Mark as duplicate
Revision history Request removal from index
 
Download options
PhilPapers Archive


Upload a copy of this paper     Check publisher's policy on self-archival     Papers currently archived: 11,105
External links
Setup an account with your affiliations in order to access resources via your University's proxy server
Configure custom proxy (use this if your affiliation does not provide a proxy)
Through your library
References found in this work BETA

View all 7 references

Citations of this work BETA
Similar books and articles
Analytics

Monthly downloads

Added to index

2009-11-23

Total downloads

20 ( #85,199 of 1,101,690 )

Recent downloads (6 months)

2 ( #178,427 of 1,101,690 )

How can I increase my downloads?

My notes
Sign in to use this feature


Discussion
Start a new thread
Order:
There  are no threads in this forum
Nothing in this forum yet.