Blacklist companies, not just punish corrupt officials – Saleh Al Shaibany « OPINION – My Other Web Site! – Majid SN Al Suleimany

Blacklist companies, not just punish corrupt officials –

Sunday Beat – Times of Oman – March 16, 2014

Saleh Al Shaibany

http://www.timesofoman.com/News/Article-31123.aspx

 Sunday Beat: The corrupt should not escape the consequences

Real justice will not be done until companies whose senior officials have been convicted on corruption charges are either blacklisted for a number of years from bidding for the government tenders, or made to pay heavy fines.

We should follow the regulations the rest of the world does to make companies accountable for the actions of their employees representing them.

The excuse that the board of directors cite by saying, “we knew nothing about it”, does not wash when it is their job to know about it. It defies logic when hundreds of thousands of rials disappear in the company’s bank accounts and the chairman says “it escaped my notice” or simply that “it was hidden from my view” and the courts believe that statement. A CEO or a managing director will not authorise the accountant to use the company’s money to bribe a government official unless he has approval from someone in the board. There is always that prior arrangement of “you go ahead with it but I will deny it if you are caught” type of thing which means the bribe had the blessing from the top.

For justice to go around a full 360 degrees instead of doing a semi circle, the Oman Tender Board (OTB) must ban the bribing companies for at least 10 years from any future activities. It is no excuse that these companies, just because they employ hundreds of Omanis, should get away with it. If they are allowed to bid again, then they should pay a fine equivalent to the bid value of the contract in which they were accused of offering bribe.

Otherwise, it will be morally wrong when one or two employees, acting under certain instructions, should be made scapegoats for something bigger than them without any consequences to the company itself.

The shocking thing is that while the company is being investigated for bribery charges, it is still in the running to win the next contract of the project they had bid for prior to the court case. It is like telling a school boy “don’t climb this tree again but you can climb the other one at the back but make sure you don’t fall this time.”

Then there is a question of the auditing companies. How does it escape their expert scrutiny when a large amount of cash was not accountable for? If a company is listed in the Muscat Securities Market (MSM) or in the case of a government organisation, surely the auditors must spot any financial irregularities. If not, where are they looking?

To say that the financials are hidden from their full scrutiny is again a lame excuse for not doing their job or simply taking for granted that “all is well” when it is not, as we now find out. For listed companies, it is the investors’ money that is used to bribe for contracts where the board of directors are the trustees. It is not business ethics, as one insider speculated. “Bribery money is the board of directors’ way of increasing profits for their investors.”

What about the role of the State Financial and Administrative Audit Institution when it comes to scrutinise the accounts of the government’s organisations and their employees? We expect such an institution with wide powers to put under the spotlight any financial irregularity committed by officials, especially those at the very top, to act decisively and timely to win the public’s confidence.

If we argue if we should make board of directors of private companies responsible for their actions, then it makes perfect sense to make heads of the ministries take responsibility for the spate of corruption cases in their patches. If their response is that “we were not aware of it”, then questions should be asked about their competence. Somebody else should be appointed who will be “aware of it” when it starts to happen again.

To sum it all up, corrupt companies should not simply plead ignorance and blame it on their managers to survive to make money another day. Similarly, heads of ministries cannot shrug their shoulders by claiming lack of knowledge. It is part of their responsibility and the buck stops with them. The time for cover-up has long passed.

You can get in touch with the writer: saleh@timesofoman.com