Going after corrupt firms the right decision


WALTER SANDOSAM

THE Merdeka anniversary celebrations are always a time to reminisce about the past and inevitably it also entails looking towards the future. 

As the country acknowledges its past, it has to recognise that all may not be as one intended. 

The rapid economic progress has bred the cancer of corruption.

The Prime Minister’s comment “I want to make corruption a part of Malaysia’s past, not its future” in “Corrupt firms in hot water” (The Star, Aug 31) appears at first glance to be wishful thinking, yet it is a serious statement of intent.

Is this an achievable vision? Are the correct signals being sent out to society at large which continues to harp on corruption?

For any vision to become reality it has to be supported by the necessary infrastructure to achieve results. Relevant laws have to be introduced or existing ones strengthened to allow for successful prosecutions.

The proposed corporate liability provision which penalises companies involved in corrupt practices sends out the right message.

It signals the death knell for corporations which indulge in these unhealthy activities.

The “big fish” are essentially fed by such corporations to whom ethics and good governance play second fiddle to the ultimate objective of increasing shareholder value.

In this manner, the demand and supply side which continue to propagate corruption will be dealt with simultaneously.

Those who speak the loudest on perceived corruption levels which are then translated into results of corruption perception indexes now have to begin to appreciate that the landscape has changed.

Both individuals as well as corporations could be hauled up to court.

The enforcement authorities are taking the offensive by improving their capabilities in forensic accounting to investigate those whose assets are not commensurate with their income levels.

These are the structural changes which will no doubt bear fruit.

The greater challenge is to change prevailing mindsets of company directors and business owners to whom corruption has become standard operating procedure.

Enactment of laws can be done at the stroke of a pen – changing cultural norms takes much more work but is not an insurmountable task.

Has the correct signal been sent to the corporate community?

The MACC has trained and emplaced certified integrity officers namely in government agencies and government-linked companies.

That again is an infrastructure enhancement initiative albeit an important one in the fight against corruption.

Mindset change has to permeate to the operating level – the level that is the most prone to either receiving or accepting bribes.

It is a function of greed and not adequate remuneration. The greatest danger is if it is pervasive throughout the operating entity.

The regulators of companies operating in Malaysia should take the cue from the government’s stance on corruption to ensure that all directors have the correct mindset.

Mandatory training programmes for directors of public listed companies should include components that embrace ethics, integrity and governance.

There is a need for frameworks to buttress such initiatives. It is acknowledged that this is a long process but changing mindsets is a key ingredient if corruption is to be relegated to the annals of history.

Corporations which continue to operate unethically will be weeded out and have to face the law with regard to corruption.

Those who have participated in corporate integrity pledge exercises and regarded these as merely public relations exercises devoid of any commitment to anti-corruption principles should now be wary of the consequences under the corporate liability provisions.

It is the responsibility of business owners and directors to ensure that correct ethical values cascade to all levels of the company.

Integrity has to be a prerequisite disposition. Stakeholders at all levels of society have to take responsibility and not take the easy way out by blaming the operating environment or the enforcement authorities.

This is the way forward for a better Malaysia which is corruption free. It has to be a collective vision.

WALTER SANDOSAM

Kuala Lumpur

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