Bribery doesn't pay

It shouldn't be surprising that corruption doesn't actually pay for companies -- yet many, do it, despite having ethical policies in place. Greasing the wheel is prevalent -- not just limited to countries where bureaucrats expect rewards to speed the flow of commerce -- not that dealing with regulatory requirements is actually a bad thing, from a public interest perspective, it might be just the right thing to have in place -- greasing the wheel is very much prevalent in developed economies. Just look at the ratio of lobbyists to elected politicians in Washington. Lobbyists provide grease, as a result, businesses get their way with less regulatory impediment.

Research however, shows that bribery simply doesn't make sense. Not only does it take a psychological toll on those involved, but it also costs companies more money -- more so in the long term -- and it breeds an environment where delays occur as bribery becomes the norm, and bureaucrats habitually give businesses the shakedown.

Knowing all that, you've got to wonder -- just why does it continue to happen?

in reference to:

"And is “grease” really all that efficient? In a paper published by the World Bank, Daniel Kaufmann and Shang-Jin Wei subjected the “efficient grease” hypothesis to careful scrutiny. They found that companies that pay bribes actually end up spending more time negotiating with bureaucrats. The prospect of a pay-off gives officials an incentive to haggle over regulations. The paper also found that borrowing is more expensive for corrupt companies, probably because of the regulatory flux."
- Schumpeter: The corruption eruption | The Economist (view on Google Sidewiki)

Additional resources:

• Transparency International's Global Corruption Report, and,
• Global Corruption Barometer

All of the above, please

Is it just me, or is this just way too obvious? It's obvious, but also amazing how many highly paid executive-types are idiots, and just don't get it. It's a balance -- and not just a focus on shareholders. Any executive that focuses entirely on shareholders, to the detriment of customers and employees, should thrown out the window -- the door would be just too polite. Focusing exclusively on the shareholders is short-term, selfish thinking -- one motivated just to please the market, generate short-term shareholder value, to the detriment of sustainable value. An executive that focuses their company solely on shareholders does a disservice to shareholders. It is customers and employees who generate shareholder value. Focusing equally on customers and employees, and in cumulative, more than shareholders, is the only way to get your employees to give more; to innovate more; to be inspired to deliver greater value -- and similarly, to get your customers to buy more from you, give you trust and forgive you the lapses that will inevitably happen.

This is obvious to me.

in reference to:

"A firm’s share price on any given day, needless to say, can be a very poor guide to long-term shareholder value. Yet bosses typically had their pay linked to short-term movements in share prices, which encouraged them to take measures to push the share price up quickly, rather than to maximise shareholder value in the long run (by when they would probably have departed)."
- Shareholders v stakeholders: A new idolatry | The Economist (view on Google Sidewiki)

The guru of the bottom of the pyramid

C.K. Prahalad died on April 16th, age 68. I didn't even know he had died, until I read it in a recent issue of the Economist. Prahalad was known for his development of the core competency concept -- but will most be remembered for his ideas of the bottom of the pyramid -- and how profit motive could help lift the world's poor from poverty. His ideas have shaped -- and will continue to shape -- the strategies of businesses the world over, and give hope to those in developing countries who aspire for more.

in reference to:

"He taught the world’s biggest companies to think of themselves anew, as a “portfolio of competencies” rather than as a “portfolio of businesses”. He taught everyone to see the developing world not as an also-ran but as a vortex of innovation and creativity. The world of management theory has more than its fair share of charlatans, but C.K. Prahalad was the genuine article."
- Schumpeter: The guru of the bottom of the pyramid | The Economist (view on Google Sidewiki)

Conficker

In November 2008, a worm quietly sounded the geek alarms as it set about to infect millions of personal computers around the internet -- to date, estimated at 6-7 million. It was christened Conficker by MS security staff. It exploited a flaw in MS Windows operating systems -- got into the computer, closed the flaw, and went about replicating itself. It communicates to its home base with an encryption level that is so powerful, it's still in the lab -- and is one of the contenders for a new security standard to be published in 2013. It is part of a powerful botnet that was used only once, in what looks to have been designed to test its viability. Ever since then, it has sat dormant. Waiting. Not much is known about it's purpose or who controls it. What is known however is scary, because there is no way to stop it, and it can be used to cause severe disruption if needed.

The good guys put up a good fight, but may have lost to the bad guys on this one -- but no one knows what the cost of losing is.

in reference to:

"The key word there is could, because so far Conficker has done none of those things. It has been activated only once, to perform a relatively mundane spamming operation—enough to demonstrate that it is not benign. No one knows who created it. No one yet fully understands how it works. No one knows how to stop it or kill it. And no one even knows for sure why it exists."
- The Enemy Within - Magazine - The Atlantic (view on Google Sidewiki)

Castro has a point

It's all politics, of course. Castro is simply using BP's oil spill in the Gulf for propaganda -- the message being, capitalist societies have ceded the public's interest for private gain -- and if the world stuck to socialist ideals, disasters such as this wouldn't happen. That's all bullshit of course, but, the man does have a point. The pendulum has swung too far in one direction. The reigns have been loosened too much on corporations, and governments need to reassert the public's interest in governing the conduct of businesses. At no time should a corporation's interest ever -- ever -- take precedence over the public's. Corporations serve society, not the other way around. Sadly, society is now hostage to corporations -- especially those that operate in the global theatre.

in reference to:

"In an opinion piece published by state media on Saturday, Castro said the disaster "shows how little governments can do against those who control the capital, who in both the United States and Europe are, due to the economy of our globalized planet, those who decide the destiny of the public.""
- Castro on Spill: Corporations Unstoppable - CBS News (view on Google Sidewiki)

Same-sex marriage victory scored in Argentina

It's interesting that as Catholics come out in numbers to brandish crucifixes at gays fighting for equal rights in the eyes of the law, similar displays of intolerance are nowhere to be found as revelations surface of the scale of the Catholic church's sexual abuse of children. Hypocrites, that's what you are.

in reference to: Argentina's gays celebrate as same-sex marriage comes a step closer | World news | The Observer (view on Google Sidewiki)