Corruption in procurement, Cheat Sheet of Ethics

Download Corruption in procurement and more Cheat Sheet Ethics in PDF only on Docsity! CORRUPTION Definition Corruption is a form of dishonesty or a criminal offense which is undertaken by a person or an organization which is entrusted in a position of authority, in order to acquire illicit benefits or abuse power for one's personal gain. Corruption may involve many activities which include bribery, influence peddling and the embezzlement and it may also involve practices which are legal in many countries. Corruption ranges from small favors between a small number of people (petty corruption), to corruption that affects the government on a large scale (grand corruption), and corruption that is so prevalent that it is part of the everyday structure of society, including corruption as one of the symptoms of organized crime (systemic corruption). Political corruption occurs when an office-holder or other governmental employee acts with an official capacity for personal gain. Types of corruption Petty corruption Petty corruption occurs at a smaller scale and takes place at the implementation end of public services when public officials meet the public. For example, in many small places such as registration offices, police stations, state licensing boards, and many other private and government sectors Grand corruption Grand corruption is defined as corruption occurring at the highest levels of government in a way that requires significant subversion of the political, legal and economic systems. Such corruption is commonly found in countries with authoritarian or dictatorial governments but also in those without adequate policing of corruption The government system in many countries is divided into the legislative, executive and judicial branches in an attempt to provide independent services that are less subject to grand corruption due to their independence from one another Systemic corruption Systemic corruption (or endemic corruption) is corruption which is primarily due to the weaknesses of an organization or process. It can be contrasted with individual officials or agents who act corruptly within the system. Causes of corruption  Greed of money, desires.  Higher levels of market and political monopolization  Low levels of democracy, weak civil participation and low political transparency  Higher levels of bureaucracy and inefficient administrative structures  Low press freedom  Low economic freedom  Large ethnic divisions and high levels of in-group favoritism  Gender inequality  Poverty  Political instability  Weak property rights  Contagion from corrupt neighboring countries  Low levels of education  Lack of commitment to society  Extravagant family  Unemployment  Lack of proper policies against corruption Methods of corruption Bribery Involves the improper use of gifts and favors in exchange for personal gain. This is also known as kickbacks or, in the Middle East, as baksheesh. It is a common form of corruption. The types of favors given are diverse and may include money, gifts, real estate, promotions, sexual favors, employee benefits, company shares, privileges, entertainment, employment and political benefits. The personal gain that is given can be anything from actively giving preferential treatment to having an indiscretion or crime overlooked. Embezzlement, theft and fraud Embezzlement and theft involve someone with access to funds or assets illegally taking control of them. Fraud involves using deception to convince the owner of funds or assets to give them up to an unauthorized party. Examples include the misdirection of company funds into "shadow companies" (and then into the pockets of corrupt employees), the skimming of foreign aid money, scams, electoral fraud and other corrupt activity. Graft The political act of graft is when funds intended for public projects are intentionally misdirected to maximize the benefits to private interests of the corrupt individuals. Extortion and blackmail While bribery is the use of positive inducements for corrupt aims, extortion and blackmail center on the use of threats. This can be the threat of physical violence or false imprisonment as well as exposure of an individual's secrets or prior crimes. This includes such behavior as an influential person threatening to go to the media if they do not receive speedy medical treatment (at the expense of other patients), threatening a public official with exposure of their secrets if they do not vote in a particular manner, or demanding money in exchange for continued secrecy. Another example can be a police officer being threatened with the loss of their job by their superiors, if they continued with investigating a high-ranking official. Influence peddling Influence peddling is the illegal practice of using one's influence in government or connections with persons in authority to obtain favors or preferential treatment, usually in return for payment. Business networking