Being an Ethical Business in a Corrupt Environment

Posted: 24 Mar 2017

See all articles by S. Ramakrishna Velamuri

S. Ramakrishna Velamuri

CEIBS

William S. Harvey

University of Exeter Business School

S. Venkataraman

University of Virginia - Darden School of Business

Date Written: March 23, 2017

Abstract

In environments with widespread corruption, most business leaders hesitate to take a firm stand against corruption. However, research conducted in Egypt, Zimbabwe, and India shows that organizations should view building a strong ethical reputation in such environments as an opportunity to differentiate themselves. To do this, companies can follow four steps. First, frame their ethical behavior in a way that resonates with as wide a network of stakeholders as possible. Second, understand that there are gradations of corruption. Third, acquire a fine-grained understanding of their stakeholders. Fourth, strategically build partnerships with high-status individuals and organizations, a tactic referred to as “reputation borrowing.”

Keywords: Ethics, Reputation, Corruption

Suggested Citation

Velamuri, S. Ramakrishna and Harvey, William S. and Venkatarman, Sankaran, Being an Ethical Business in a Corrupt Environment (March 23, 2017). Harvard Business Review, Forthcoming, Available at SSRN: https://ssrn.com/abstract=2939787

S. Ramakrishna Velamuri (Contact Author)

CEIBS ( email )

Shanghai-Hongfeng Road
Shanghai 201206
Shanghai 201206
China

William S. Harvey

University of Exeter Business School ( email )

Rennes Drive
Exeter, EX4 4PU
United Kingdom

HOME PAGE: http://business-school.exeter.ac.uk/about/people/profile/index.php?web_id=Will_Harvey

Sankaran Venkatarman

University of Virginia - Darden School of Business ( email )

P.O. Box 6550
Charlottesville, VA 22906-6550
United States
804-924-6892 (Phone)
804-243-5023 (Fax)

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