Jill McMahon – Wednesday, June 29, 2016
Corruption is a huge problem for Australian organisations because it exists in so many places and in so many forms that the average manager may not even consider it an issue.
Left unchecked, even minor corrupt behaviour can spiral out of control.
Using legitimate processes is one way that corruption can be concealed, making it easy to justify and difficult to detect.
Defining corruption and legitimate processes
Workplace corruption can be broadly defined as behaviour that violates the trust that organisations place in their workers. It can range from serious fraud and abuses of power to minor issues such as fraudulently claiming sick leave.
Legitimate processes are processes, policies and procedures that a workplace uses to function. They can sometimes be manipulated for corrupt purposes.
For example, an employee who makes a complaint about a manager may be transferred to another work station, have their overtime hours reduced, or be placed on continuous night shift. The decision-maker justifies the change by saying that there was an operational need for the change, but the timing indicates that it was made because the employee complained.
More – Corruption and Deviant Behaviour in the Public Sector
Detection is difficult
Because the corrupt activity is concealed by legitimate processes, it can be very difficult to prove. It is only by uncovering the background to the decision that corruption may be established.
For example, if our employee was put on permanent night shift just a week after making the complaint against the manager, surrounding relevant factors may be:
- There was no warning that the decision was about to be made.
- No one discussed the matter with the employee.
- The manager and the shift manager are known to be good friends.
- There are emails between the managers about changing the employee’s shift because of the complaint.
All of these factors are important to consider as they establish context for the decision being made.
Other legitimate processes
Corrupt legitimate processes can also exist in other forms. For example, there might be a strict requirement for payment of invoices to be signed off by two people before being approved. If two employees work together to create and approve false invoices and then pay the money into their bank accounts, this is corruption of a legitimate process.
If a group in a workplace regularly engages in corruption, for example using a company credit card to buy items for personal use, there may be pressure on other workers to join in or collude. If they refuse, the group may organise for the workers to be transferred.
What is the impact?
Incidents of workplace corruption in Australia are increasing. The Transparency International Corruption Perception Index recently noted that in the past four years, Australia has dropped from 8th to 13th position. Public sector corruption is a key contributor, the ABC reports, but there are also widespread problems in the private sector, notably the banking industry. There have been recent calls for a Royal Commission into the industry to investigate its practices.
The impact of corruption is huge. In 2012, KPMG’s survey of fraud, bribery and corruption estimated that Australian and New Zealand organisations lost $373 million to corruption. Employees were thought to be responsible for 75% of corrupt activities.
What can be done?
It is important to understand that corruption is usually not spontaneous. There is often a perfect storm of events and situations that causes employees to engage in corrupt activities.
Understanding what constitutes corruption and taking preventative measures to avoid corruption can help organisations to minimise its effects.
Corruption is an important issue for all organisations and the better it is understood, the greater the chance of minimising the harm that it can cause. Using legitimate processes is a great cover for corrupt employees. Detection is difficult and there are usually plausible explanations for their actions. If you suspect corruption in your organisation, WISE Workplace can assist with independent investigations and expert advice.
Content retrieved from: http://www.wiseworkplace.com.au/_blog/WISE_Blog/post/c/.
