When Enron imploded, the subsequent wave of corporate scandals occupying front pages and prosecutors’ attention tended to confirm the cynical suspicion that bankrupt ethics and Big Business go together like corked bats and baseball: illegal, embarrassing when exposed — but a long-standing part of the game all the same.
Put bluntly, smaller outfits are no angels. Yet because they have fewer resources, entrepreneurs often assume their businesses can do without a code of ethics. According to the experts, it’s an assumption that may make small-business owners and employees even more open than their larger counterparts to the temptation of embracing dubious business practices.
Researchers from the University of Nebraska at Lincoln. Bribery, general dishonesty, shady dealings with corrupt officials, and payoffs to local mobsters were all part and parcel of the business routine, the researchers found. Some of the outfits — none with more than $50 million in annual sales — also admitted to contributing illicit cash or manpower at the behest of host governments, which wanted unions busted or favors for influential ethnic and religious groups.
Since the sample was small — just 20 companies, half in manufacturing and half in services — it’s hard to project the findings’ broader relevance to all U.S.-based SMEs with international operations. Yet the study offers an almost too-clear window into the darker side of international trade. In fact, he was so discouraged by the results and what they implied, he admits to moments when he almost wished he had never embarked on the project.