Corruption is good for business

Capital-hungry entrepreneurs should look to regimes like Mugabe’s for 100 trillion trillion Zimbabwean dollars to kick-start businesses, according to the Journal of Management Studies, sort of.

The recently published study suggests that rampant corruption in countries the world over could be beneficial rather than harmful to would-be money makers. Who’d have thought it?

The journal doesn’t advise paying off militias in Khat and grenades to whack rivals. The idea is that adapting to areas where there is a dodgy despot on the take means your company’s in an excellent market position where you may be the leading competitor because you’re the only competitor.

Once you’ve done well in one corrupt country, you can make it anywhere, says the report. “Even where competitors fail on entry or dare not to tread.” Consider that next time you’re ferrying roubles into Moldova.

The study’s message is that working in a corrupt company helps develop organisational capabilities rather than illicit ones. That’s not slipping the local copper a bung and organising your way out of prison. Instead, understanding that there’s a neighborhood protection racket after a company’s swag helps get used to working in strange and alien environments.

The study says with corruption, in international investment, “the heterogeneous impact of government corruption on firm outcomes, is dependent not only on the power wielded by dishonest officials, but also influenced by firm characteristics, industry regulations, political structures and organisational culture,” so according to publishers at Wiley-Blackwell, corruption “can be a distasteful but manageable part of a company’s international investment environment.”

In layman terms, it seems to be saying there’s no reason not to make a buck out of a country just because it suffers from corruption here and there.