Question

In your opinion, how was corruption affected International business?

Answer 1

Corruption is negative social phenomena where people try to make quick gains at the expense of others in the society and it affects society and business in a negative way. The international businesses are also negatively affected because of the corruption. In many countries when multinational companies want to enter and expect some rule to change to their favor, they lobby through any organization. Lobbying is not really illegal but the way companies use it sometimes becomes unethical activity and corruption flourishes in that environment. Sometime companies pay huge sum of money to any individual in political system or do some big favor to their relative to get the rules and regulation amended. Although in the short term they might succeed but in the long run it has been seen that when this scandal comes to light both the individuals as well as the company face backlash for this. Also changes in government often happen because of corrupt political system. The cost of corruption in the business is huge especially in emerging market where businesses have to go through many approvals before setting up an entity. Because of corruption many companies avoid certain markets. The growth of economy is stunted due to corruption. Many companies who indulge in corruption often have to pay heavy fine.