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

RELATED STORIES 

  Sunday Beat: Oman   needs strict laws to combat corruption

  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

REPRODUCED ARTICLE