However, Burgis points out, choking off corruption is in the interest of the company as it is rarely the mid-ranking executive who pays the financial burden of getting caught – the company does. "The problem is you get the M&A banker momentum, where there is a huge push to do the deal, it’s big, exciting – they don’t want anyone to get in the way." He adds that in the due diligence world there are a lot of law firms and compliance departments trying to get it right, trying to ‘choke off’ the middlemen who are happy to pay bribes to advance themselves.
"There is the guy I quote in the book who says a lot of this due diligence work is just manufacturing liability he says companies want to be able to say ‘we had a good look at this partner before we did a deal with them…we heard some rumours but we never saw anything concrete to demonstrate this arrangement would be corrupt in some way so we went ahead with the deal.’"
So why do some companies, unintentionally – as is always protested – become embroiled in corruption? After all his research, what’s Burgis’s advice for companies to mitigate corruption? Anti-corruption and corporate social responsibility (CSR) conferences now appear regularly in the mining industry’s events calendar. The mining industry is well-versed on the potential for corruption in developing countries, especially some of those in Africa. These are just a few of the illicit goings-on Burgis details in his book which covers the oil industry as well as mining commodities. Other stark examples include an Israeli businessman who used his close friendship with the Congo’s current president to illicitly secure mining deals worth billions, and how one Western mining company illegally acquired lucrative mining concessions in Guinea. In one of the book’s examples, a senior aide of the former Kabila government in the Congo disclosed how the president used to receive $4m each week in suitcases from state-owned and private mining companies.īurgis details how tantalum was illegally funnelled out of the Congo during its brutal civil war to meet surging global demand, caused by a boom in mobile phones. The level of corruption, violence and subsequent money lost to individual states is staggering. Resource nationalism means more than states simply demanding project ownership and levying heavy taxes. Sharing the wealth: the evolution of resource nationalism
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