Joint Meeting of the Mid-Atlantic and Northeast Regions

Odebrecht Bribery: The Worst FCPA Violation

• In Event: Accounting and Organizations

Abstract

This study uses Odebrecht bribery, the worst violation of Foreign Corrupt Practices Act (FCPA) involving $3.5 billion penalty, to highlight the seriousness of bribery in the global economy, and to instill in managers of multinational corporations and students an anti-bribery attitude and a strong bribery-prevention desire. The study conducted an extensive research of academic and practitioner business articles along with FCPA enforcement documents against Odebrecht, a Brazilian construction conglomerate, to address the following seven questions. First, what are Brazilian institutional environment and cultural values conducive to bribery? Second, what did Odebrecht do to deserve such exceptionally large penalty? Third, what were consequences to Odebrecht and its executives who orchestrated the bribery? Fourth, why was Odebrecht subject to the U.S. Foreign Corrupt Practices Act? Fifth, what were corrective actions that Odebrecht agree to take to prevent any future bribery? Sixth, what were anti-bribery responses to Odebrecht scandal in Brazil & Latin America? Seventh, what are harms to society as a result of bribery, and what would you do if you discover bribery in your organization? Answers to these questions are useful to: (1) multinational corporations that can use this study as part of ethics/anti-bribery training for their managers, (2) educators who want to instill anti-bribery attitude into their students, (3) academia who are interested in bribery or FCPA research, and (4) regulators who are interested in anti-bribery reform.

Author

• Obeua Persons, Rider University