COVID and corruption

Journalists and lawmakers are starting to investigate how certain public contracts related to COVID-19 have been awarded.

We should expect many more investigations of this kind all over the world. When billions of dollars converge on one event, whether it be the Olympics or a pandemic, there is bound to be corruption, self-dealing, and other improprieties.

With the Olympics or the World Cup, we understand the importance of augmenting corruption controls years before the event takes place. The minute the host city is announced, we can start reinforcing the compliance program and the ethical culture of our local operations before the first bid is due. With COVID-19, governments have not had time to do this. They’ve all had to rely on ordinary controls.

But here’s one thing we can prepare for: the reopening. Once the machine revs up again, and millions of customers are urging millions of companies to release goods that depend on millions of suppliers, the pressure will be on. And with pressure comes not only wrongdoing but a diminished capacity to fight wrongdoing.

On the other side of the reopening coin is the need to “ease” compliance. My friend Richard Bistrong wrote an excellent piece about it on the FCPA Blog, which I recommend you read with this one as an interesting balancing act.