Abstract
Russian CEOs are arguably the most experienced managers in the world when it comes to working in corrupt environments. For our analysis, we gathered data from the CEOs and owners of 111 local and international companies operating in Russia. We asked them to assess their experiences with informal practices, including the extent to which their businesses are dependent on informal deals and the strategies they deploy to mitigate business corruption. The list of specific practices and strategies assembled in the pilot interviews and media content analysis has been cross-checked with the existing typologies of corruption in post-communist societies and verified through in-depth interviews. This study presents the outcomes of our analysis, one of which is that companies tend to blame officials for corrupt activities while hiding their own internal corruption from public view. Both are dependent on the industry in which they operate, however. The paper also includes the approach we developed to understand the less reprehensible but more widespread forms of corruption such as collusion, conflict of interest, cronyism and nepotism, fraud, gifts and hospitality, lobbying, abuse of power or office, and influence peddling
Highlights
Corruption remains one of the main challenges in doing business in many countries.[1]
We asked them to assess their experiences with informal practices, including the extent to which their businesses are dependent on informal deals and the strategies they deploy to mitigate business corruption
Little is known about other forms of corporate corruption, such as collusion, conflicts of interest, cronyism and nepotism, fraud, gifts and hospitality, lobbying, and influence-peddling which are arguably more widespread. Such an incomplete picture offers fertile ground for the emergence of popular perceptions of the origins and nature of business corruption in Russia, the most popular being that corrupt government officials at all levels extort rents from innocent businesses, which suffer from bureaucratic red-tape and are forced to engage in shadowy practices
Summary
About this Working Paper Series: In 2010, Lawrence Lessig launched the Edmond J. Safra Research Lab, a major initiative designed to address fundamental problems of ethics in a way that is of practical benefit to institutions of government and society around the world. Safra Research Lab is tackling the problem of Institutional Corruption. On March 15, 2013, this Working Paper series was created to foster critical resistance and reflection on the subject of Institutional Corruption. How to Mitigate Corruption in Emerging Markets: the Case of Russia by Stanislav Shekshnia, Alena V. Safra Research Lab Working Papers, No 36 Harvard University.
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