Reference no: EM133034632

The World Bank has a published blacklist of corrupt and fraudulent companies. These companies have been banned from receiving project funding due to fraud, corruption, collusion, or coercion. Stephen Zimmerman, director of operations of the World Bank's Integrity Division, says "We're not a global policeman but what we can do is facilitate the global conversation against corruption [...] the World Bank is unique in that it's the only office in the world that looks at corruption cases globally; law enforcement tends to be national by its nature." More than 600 companies have been barred from doing business with the World Bank, and of those, 117 are Canadian: the most of any country in the world. The United States has the second most companies with 46, while Indonesia is third with 43 companies barred. Of the 117 Canadian companies barred from doing business with the World Bank, 115 represent SNC- Lavalin and its subsidiaries. SNC-Lavalin is the largest engineering firm in Canada, based in Montreal, with offices in over 50 countries and operations in over 160 countries. SNC employs more than 50,000 people in a variety of industries, including infrastructure and construction, mining and metallurgy, oil and gas, environment and water, and clean energy. The company also advertises that it can provide clients with financing, asset management, engineering, construction, procurement, and operations management. In 2010, allegations of bribery were levelled against company executives, and the company began a series of internal ethics initiatives, Executives from the firm even met with Quebec's premier to reassure political leaders that the company had taken the necessary steps to improve its corporate governance, In 2012, however, SNC'S CEO was arrested on fraud charges, and in 2013, four company executives resigned from the organization for various undisclosed reasons, Also in 2013, ethical violations began to come to light when one company vice president was jailed in Switzerland for suspicion of corruption, fraud, and money laundering in North Africa. Another executive, Stephane Roy, was on trial for fraud, bribery, and contravening a United Nations act. Roy alleges that he was acting on orders by his superiors, and that he had been framed and scapegoated by higher-level executives who called him a rogue employee. Roy told reporters that SNC-Lavalin created corporate culture where it was common practice to do all that was necessary, including the payment of commissions and other benefits to obtain contracts, including in Libya A preliminary hearing on federal corruption and fraud charges against the company is scheduled to begin in September 2018, involving wrongdoing related to contracts that SNC had in Libya between 2001 and 2011, when $47.7 million was paid to public officials in Libya to influence government decisions. The company acknowledged that there were incidents of corporate malfeasance in the North African country, but says that it has undergone a complete overhaul of its ethics and compliance procedures since then, and that all executives who were with the company at that time have been removed from the organization.

Apply Your Understanding

1. How might examples of executive corruption at SNC influence attitude formation in company employees?

2. How might cognitive dissonance play a role in unethical behaviour?

3. What factors influenced Stephane Roy's (un) ethical behaviour?