Bribes, Kickbacks, “Commissions,” Oh My! — Dealing with Corruption
Corruption is hard to fight while running a business — but strong leadership and ethics can help you succeed, and even change a corrupt system.
Corruption is an unfortunate fact of business life. How can you remain ethical and still survive when it seems that everyone else is playing the game? Soji Apampa is one entrepreneur who believes there are ways to strategically navigate a corrupt system. Hear how his NGO in Nigeria is helping entrepreneurs to keep their hands clean. And listen to true stories from business owners across Africa and South Asia about the real cost of corruption on lives and livelihoods.
When it comes to dealing with corruption, you are definitely not alone. Which is a key reason why Soji Apampa created an NGO dedicated to the issue. In 1995 the Integrity Organization was born and later the Convention on Business Integrity for the sole purpose of dealing with the issue of corruption in Nigeria. The organization’s early goal was simple according to Apampa: “We would like to be that matchstick that starts the bush fire. And even if the matchstick gets extinguished, so long as the fire spreads, we will have achieved something.”
Twenty-five years later, they’ve achieved far more, studying corruption and explaining how it actually operates to help others avoid it — in Nigeria and beyond. “The reasons why people fall prey is, number one, they don’t know the rules. So, you don’t know the rules, you do the wrong thing, they just charge you. If you do the right thing in the first place, you can avoid those petty charges to start with,” Apampa suggests.
Apampa encourages people to do the right thing from the start to avoid the “slippery slope” of corruption. “For many wise organizations, they just bite the bullet from the start and do the right thing, and they can avoid the bulk of it. But if you pay once, they keep coming. And imagine you do that with four or five agencies, then you’re totally at their mercy,” he says.
Unfortunately, the only way many small businesses can avoid corruption is to stay small and under the radar, but this ends up hampering their growth. So, one of Apampa’s goals is to help educate people on how to be ethical within an unethical environment. Leadership, he believes, is the best place to start.
“If you’re trying to be ethical as a small business, it starts from the posture of the leader,” Apampa explains. “Everyone takes a cue from there. It’s not enough for you as the chief executive to be a moral person or an ethical person if you cannot put in the systems for compliance to ensure that even those who want to act immorally or unethically cannot.”
Apampa believes there can be upsides to operating ethically within a corrupt system. “The whole anti-corruption thing is not always all bad, because if you are trying to survive by doing it ethically, you have to be more innovative than those who are willing to do the bad things.”
Listen to Apampa’s advice on how to develop strategies and structures for avoiding or navigating corruption in your business environment.
Grit & Growth is a podcast produced by Stanford Seed, an institute at Stanford Graduate School of Business which partners with entrepreneurs in emerging markets to build thriving enterprises that transform lives.
Hear these entrepreneurs’ stories of trial and triumph, and gain insights and guidance from Stanford University faculty and global business experts on how to transform today’s challenges into tomorrow’s opportunities.
Soji Apampa: You’re trying to be ethical in what is predominantly an unethical context. You’ve got an external culture. In those contexts, it’s not a moral issue to be corrupt. It’s an instrumental issue. It’s a survival issue.
Darius Teter: When the rules of the game are rigged, how do you win? Should you even play?
Soji Apampa: So, many people think, “Don’t be stupid. It’s what everybody else is doing. How do you think you can survive trying to buck the trend? Who do you think you are? We’ve got to do what we need to do to survive.”
Darius Teter: Welcome to the second season of Grit & Growth from Stanford Seed, the show where Africa and South Asia’s intrepid entrepreneurs share their trials and triumphs, with insights from Stanford faculty and global experts on how to tackle challenges and grow your business.
Corruption is hard to see. It happens off the books or under the table. A little money here to find your file, a commission to consider your tender, a kickback or the contract goes kaput. But whether it comes with a wink or with a threat, corruption can throttle your business. So can you keep your hands clean and still run a successful business? On this episode, we’ll explore how to navigate a corrupt environment, the ethical dilemmas that business leaders face, and strategies to survive.
But that’s not all. Corruption is also hard to talk about. Business owners fear retaliation. Speaking out can put their lives and livelihoods at risk. And though few people feel comfortable recounting their experiences, the truth is that for many it’s something they have to deal with almost every day. So on this episode, we also wanted to share several stories of corruption that we’ve collected anonymously in recent years from participants in our programs. Stories like this one.
Anonymous Caller 1: Twice I’ve been approached by clients after a tender, and informed that in order to win I had to give a commission. The first time, I declined. My offer was the best priced and, in my opinion, the best technically. I did not win the project. The second time, I paid the commission and won the project. I didn’t like it, but I felt like I did not have any options. This is the environment we are in. I would love for things to change.
Darius Teter: Our guest today has an incredible story of his own, one that’s still being written. In fact, I bet that few people in the world know more about fighting corruption than this man.
Soji Apampa: My name is Soji Apampa. Well, Soji for short. The full name is Olusoji.
Darius Teter: We caught up with Soji at his office in Lagos as people finished up work for the day.
Soji Apampa: Yes, apologies. Some people came near the door and refused to read the “Do Not Disturb.” Apologies, they’ve now been kicked out.
Darius Teter: Soji doesn’t mind staying late, though, because he’s passionate about fighting corruption. It’s work he’s been doing for over 25 years.
Soji Apampa: I’m one of the founders of the Integrity Organization, which also gave birth to the Convention on Business Integrity. The organization was established in 1995 for the sole purpose of dealing with the issue of corruption in Nigeria.
Darius Teter: So before you launched the Convention on Business Integrity, what were you doing?
Soji Apampa: I was an angry young man before I started the Convention on Business Integrity. Honestly, I had returned from my A-Levels and first degree in the UK, and I decided to go back to Nigeria to represent AB Sandvik International, the Swedish saws and tools manufacturer, to distribute their saws and tools consumables. And I just found that, okay, I was representing what was like a Rolls Royce in the industry, but I was competing with people who found it easy and normal to doctor invoices. And their trading partners in China and elsewhere were happy to write invoices that were not real, cut down the cost of the materials to half the value, so they’ll pay less in duties. But I wouldn’t do such a thing. I just found I was very angry at the system in Nigeria, but I just was an ordinary person trying to survive in business.
Darius Teter: This wasn’t just an issue for Soji. The Corruption Perception Index scores countries on a scale of zero to 100, where zero is highly corrupt and 100 is not corrupt at all. In 1996, Nigeria scored just 6.9, which ranked it dead last.
Soji Apampa: In the ‘90s, because Nigeria was literally at the bottom of that league table, Nigeria gained the reputation of being seen as the most corrupt country in the world. And it took several decades to shake off that appellation of Nigeria being that corrupt.
Darius Teter: And the consequences of corruption aren’t just financial. I worked for the Asian Development Bank for years financing huge infrastructure projects, and I experienced this all the time. It hit me then — I was only in my early thirties — that the real cost of corruption wasn’t the bribe or the cheating on the bid. It was the terrible public works that were subsequently built, that couldn’t be maintained because they weren’t built to standards. So the real cost of corruption is paid by the users of those public services, because the services are below par.
Soji Apampa: In Nigeria, we say the real cost of corruption is measured in body bags. Because ultimately it leads to the demise of so many people, in health care, in all sorts of government service delivery, that it usually ends up with people in body bags.
Darius Teter: While corruption itself is dangerous, fighting it can be equally dangerous. In the mid-’90s, a coup led to the regime of Sani Abacha, a military dictator who conducted unprecedented levels of state-directed violence. Soji’s anti-corruption work put him directly in the line of fire. And to survive, he had to be shrewd.
Soji Apampa: The government had such an overbearing presence in the economy at the time that they didn’t want anything that appeared, should I say, activist. But in the duplicity of the government of the day, they were preaching transparency and accountability, but doing otherwise. So when we got summoned by the directorate of military intelligence, in those days, we could say, “But we’re only supporting government policy. Government says it’s promoting transparency and accountability, and that’s all we’re trying to aid.” So though they couldn’t move against us, they made themselves present at every public event and they introduced themselves to us. So we were always closely watched, that we knew. But we didn’t get beaten up like some people got beaten up, very badly.
Darius Teter: Violence, power, and fear. That’s how systems of corruption maintain themselves, whether you’re in Nigeria or oceans away. But for business leaders in these markets, you have to be able to talk about the elephant in the room. That’s why we started collecting their stories.
Voicemail message: Your call has been forwarded to an automatic voice message system. At the tone, please record your message.
Anonymous Caller 2: If you want property development approvals in my country, you need to pay the authorities, from local councils all the way up to national agencies. If you want them within a reasonable timeframe, you have to pay even more. We’ve resorted to paying a third party to deal with approvals, so that we can stay out of it. If I had the courage, I would lobby the government, but in the current environment it would mean endangering my life.
Darius Teter: So it’s the mid-’90s. Corruption is rampant. Soji is angry, but he’s unsure what to do. This is the point in many stories when the hero meets somebody that sends them on their journey. In some, it’s an old wizard, in others a mysterious prophecy. But for Soji, it was the Swedish ambassador.
Soji Apampa: The Swedish ambassador took a liking to me for some reason. He’d just call me and say, could I come over to the embassy? And he’d take me to his residence and say, “So, Mr. Apampa, what are you doing about Mr. Abacha?” And I’d say, “Me, Mr. Abacha?” and he’ll thump the table, “I’m sorry for you, for your children, your children’s children, if young people like you don’t do something.” And I said, “But what can I do?” And he’ll thump the table again. “Think of something, think of something. It’s your future.”
This went on for like six months, in 1994. That’s what drove me to go to my lawyers and ask, “Please, I need to get this old man off my back. What can I do?” And they said, “Well, you can start an NGO.” And I had to ask, “What’s an NGO?” They explained the whole thing. And then I said, “You know what? Just get me one of those. I need to get this man off my back.” But before too long, the old man took ill, they rushed him to Sweden, he died, and he didn’t come back. And that’s where my problems began, because I thought, this man has tried to transmit — for a significant part of his last days — a message to me. What does this all mean? And then it moved from just trying to get him off my back to: What am I now going to do with this burden? And this is really how I got sucked in.
Darius Teter: So when you started the organization, what were your goals?
Soji Apampa: It’s interesting you should ask that question, because we asked ourselves that. ‘Cause this was during the Abacha regime where people went missing. Dr. Akwasi Aidoo, a Ghanaian, he was running the Ford Foundation, and he came to us and said, “I hear that there are people who want to do something about corruption. Are you crazy? Do you have a death wish?” And we said, “We would like to be that matchstick that starts the bush fire. And even if the matchstick gets extinguished, so long as the fire spreads we’re happy, then we feel we have achieved something.” So that’s all we wanted to do, get it to be a front-burner issue.
Darius Teter: Over the course of 25 years, Soji and the Convention on Business Integrity have achieved much more than that. And in doing their work, they’ve seen the patterns of how corruption operates.
Soji Apampa: The reasons why people fall prey is, number one, they don’t know the rules. So you don’t know the rules, you do the wrong thing, they just charge you. So if you do the right thing in the first place, you can avoid those petty charges to start with. Then secondly, if you don’t follow the procedure, there’s a tax. You will get taxed. It will cost you. So if you know the right procedure, you can avoid that petty tax. So it’s peeling away the layers of the onion. And you as a business might be on enough of the periphery that by the time you’ve peeled off a few layers through your own compliance, you don’t need to go any further and therefore you escape the brunt of the corruption. Because you can choose, therefore, that, “No, we would rather suffer a delay than pay the extra tax,” for instance.
But the reason why there’s such a big market in these facilitation payments is because business is always trying to avoid a penalty. And so they pay to avoid the penalty. But as soon as you get into that rut, somebody else is going to come down the line and remember that you helped to doctor the invoice and they’re going to come and do a tax audit. And once they do a tax audit, they find a gap. And now you’ve got to pay this new set of people. Once you just start, it’s a slippery slope. So for many wise organizations, they just bite the bullets from the start, and do the right thing, and they can avoid the bulk of it. So they take the hit once and get the delays and everything and they have a reputation, and typically the officials avoid them.
Darius Teter: So once people recognize that you’re not an ethical business, that everything is in fact a negotiation, you then have to deal with more and more officials in more and more agencies.
Soji Apampa: And it’s not just the big organizations — even the small ones do that. And the tax authorities are willing to spend time going after small organizations in the same way. So if you pay once, they keep coming back. And imagine you do that with four or five agencies, then you’re totally at their mercy.
Anonymous Caller 3: In our business, numerous bribes are expected to secure a contract. Everybody calls them a commission or a finder’s fee. If you don’t offer this commission, people might not even pick up your phone calls. We have decided that our policy is not to pay, and it’s caused us to lose several contracts in the recent terms. In some cases required documents were ripped out of our proposals as well. Now we are at a crossroads. Should we hold firm or change our policy? Even if we start paying these commissions, how deep does the rabbit hole go? That’s a big question.
Darius Teter: So in some countries where I’ve worked, if your business stays below a certain size, you’re kind of invisible to all the bad stakeholders. You’re not big enough for them to even bother with you. But then once you get too big, then you start to draw a lot of attention from a lot of stakeholders who now see you as a target, right? And like in Indonesia, if you got really big, you would get the knock on the door and somebody would appear and say, “So and so is now your silent partner with a 10 percent stake in your business.” And there was even a guy, a former minister whose nickname was Mr. 10 percent, because if your business got big enough, you would be told that this is now your silent partner. I’ve even met people who said, “I don’t want my business to get above this certain size because then it just becomes untenable.”
Soji Apampa: I couldn’t agree with you more, particularly about when you formalize. So everyone is prey, easy prey in Nigeria, once you formalize. If you don’t formalize and you can stay under the radar, then you avoid a lot of this. Which is what stops many small businesses from growing, because they won’t formalize, and therefore they put themselves out of the mainstream of gaining the resources and having access to the kind of help they need.
Darius Teter: In environments like these, corruption can feel so deeply ingrained that people can’t imagine any other system.
Soji Apampa: Everyone knows that this is the game. It’s a game of give and take, because many people grew up in a context where they never knew it any different. If you don’t spend enough time and effort helping them to separate what is unethical from what is ethical, you will assume that everyone would naturally know what is unethical. Many people don’t. They just see it as part of the business culture. So it’s not that they’re deliberately trying to be ethical. In many cases they just don’t know any different.
Darius Teter: Even if you do recognize the difference, it’s not always as simple as right versus wrong.
Anonymous Caller 4: Several years ago, my company was growing by leaps and bounds. Our biggest client had contracts that totaled several million dollars. We skilled up and took out loans to fulfill these contracts. We hired almost a thousand people. I mean we were doing well. Then the client changed management. The new director said that unless we kicked back a percentage of our contracts, they would terminate us. Now, that’s not how I do business. So I chose not to give into the bribe. The results were disastrous. They did keep their word on that. Our contract was terminated and many people lost their jobs. The company literally went under. We spent the intervening years building back piece by piece, to where we were. I’m still not sure I made the right decision, but I did what I thought was right. But it cost many people their livelihoods. It’s not always black and white.
Darius Teter: I want you to put yourself in the shoes of a managing director of a company, let’s say a million-dollar company, and they want to try to run an ethical business. Recognizing that the lines are blurry and there might be a difference between moral leadership versus being a moral person, can my business be an island of integrity in a sea of corruption? Is it even possible?
Soji Apampa: It is very possible. And off the top of my head, I can name you some, like Construction Kaiser, that’s run by a friend of mine. And he founded the company in 1994 and — hand on heart — they can tell you they’ve never paid a bribe, small or big. And they’ve had to walk away from numerous deals. And they didn’t touch anything from the public sector, no opportunity was big enough for them in the public sector. They wouldn’t even touch it. They were happy with their growth, just bidding to the private sector. Each time the staff came up and said, “But we can’t continue like this. We’ve got to grow.” The chief executive will still say, “No, I can live with this rate of growth. I’m not requiring it from my staff to cut corners. And if you do, this is the penalty I’m going to put to you if anyone dares.” So to have the ability to remain resolute over a number of decades was the second thing.
Darius Teter: Of course, corruption can come from inside your company, too.
Anonymous Caller 5: Well, we found out that some of our employees were making side deals with some of our suppliers for their personal gains. This had an impact on a business and the impact was significant. Our cost increased, and the culture of our organization was fractured. Before we could deal with the situation, we had to collect the evidence to protect ourselves from a possible lawsuit. Then we fired the individuals involved in such activities and blacklisted the suppliers. The results were substantial. Our margins increased. We got more suppliers. We improved our quality of service and restored our organization’s culture.
Soji Apampa: You see, this is what I’m saying, that you’re trying to be ethical in what is predominantly an unethical context. You’ve got an external culture. In those contexts, it’s not a moral issue to be corrupt. It’s an instrumental issue. It’s a survival issue. So many people think, “Don’t be stupid. It’s what everybody else is doing. How do you think you can survive, trying to buck the trend? Who do you think you are? We’ve got to do what we need to do to survive.” You find a lot more debate taking place internally, with some staff feeling that the management is being foolish and is not being prudent enough, and they’re trying to be holier than the environment.
So you find that your greatest opposition actually comes from within. And sometimes you have to depart and part ways with some members of staff, who are unable to adjust to that environment, and take on those who can and who are willing to be innovative and find acceptable ways of taking the company forward despite the challenges. If you’re trying to be ethical as a small business, it starts from the posture of the leader. So if the leader is speaking from both sides of her mouth that, “Well, I want us to be ethical.” But then when we’re in trouble, he looks the other way or she looks the other way and says, “Quickly pay so and so.” Or you pay an agent to do it. Everyone takes their cue from there.
And they know that, yes, it’s something you would really like to do, but it’s not really the DNA of the company. The DNA is more to do whatever you need to do to intervene, to survive, and the staff will take their cue from there. But when they find that, consistently, the leader refuses to cut corners and it costs the organization, and the leader is still willing to live with that outcome, then they get the message. So that tone at the top from the executive, the coaching of the team, the explaining over and over, the ensuring that there are codes and for the codes that there are consequences internally for not following what it is that the CEO wants done, and therefore ensuring the ethical management, then you’re not going to have it.
So it’s not enough for you as the chief executive therefore to be a moral person or an ethical person, if you cannot put in the systems for compliance to ensure that even those who want to act immorally or unethically cannot, because of what you’ve put in place. Then you’re going to always have this difficulty on your hands.
Darius Teter: Navigating corruption can feel like walking through a minefield. Any regulation, certification, supplier, or public official — they all have the potential to cause you massive damage.
Anonymous Caller 6: At one point, 80 percent of my business was providing supplies to the government. Let me repeat that: 80 percent. A minister we worked with threatened to block payments to us in the hopes of becoming a company shareholder. He then offered to, quote unquote, “Help process payments.” We all know what that means, on the condition that we give him a percentage of our earnings. If we refused, he said he would remove us from the supplier list. I decided to play along until our lawyers were eventually able to cut him out of the process, but only when we renegotiated our scope of work.
Darius Teter: In these environments, it becomes incredibly important to understand all the players involved. This is actually a methodology we teach at Stanford. It’s called Strategy Beyond Markets. Your supply chain or your value chain is not just the people who are selling you goods and buying stuff, or the retail space in which your products appear. Anybody who you rely on to issue you a certificate or a license or permission to operate, anybody who can affect your business, positively or negatively, is actually part of your value chain. They’re a stakeholder.
Soji Apampa: Yes. In fact, I will call it part of your market system. So in your market system, you have your traditional value chain that goes from production to consumption. But you’ve got the rules of the game. There are stakeholders who control the rules of the game. You’ve got to identify who they are. Then you’ve got stakeholders that provide supporting functions for that value chain to operate, like the banks, like others. You’ve got to identify them as well. And together they all make up your market system.
Darius Teter: This process of assessing your market system is called a stakeholder analysis. And by mapping this out, you can shift your strategy from purely reactive to more proactive.
Soji Apampa: If you then understand those whose potential to damage you is more than their potential to cooperate with you, you’ve got to know them and prepare a strategy to defend against them. Even if you know that the risk of encountering them is low, at least have a business response for that. Then you’ve got those who have a high potential to damage you, but also a high potential for cooperation. You know you’ve got to engage in dialogue with those. You’ve got to keep them in front of you and have that engagement and manage them actively. So you’ve got to actively have a plan to manage them and keep them in check. Then you’ve got those who will always cooperate with you anyway, and very little threats. Those are your supporters.
Darius Teter: Those are your allies.
Soji Apampa: Yes, your allies, yes. And you need to also map them back to the power and interest map, so you understand who are your powerful allies as well, and cultivate them. So if you do run into trouble, you need some powerful allies who could say, “Actually, you guys are doing the wrong thing. I need you to back off.”
Darius Teter: What I love about this is that you almost never see this in a business strategy. When companies go through the Stanford program, their whole purpose of the program is to figure out how to grow their business. So they’ll come up with a very beautiful detailed strategy for scaling their business. Some people are focused on professionalizing their management in HR function. Some are focused on new segments, new markets, product innovation.
But you almost never see in their strategy, “How am I going to deal with these other actors that are part of my market system?” And it’s not that they’re not thinking about it, right? They’re thinking about it. It’s just like, well, that’s the cost of doing business and I’ve got my rainy day fund for dealing with that, or I’ll deal with it if it happens. But what you’re saying is, no, no, you need to figure out which of these stakeholders actually have a high potential to harm you. What’s the probability that they’re going to get in my business? Which ones do I need to collaborate with? Which ones do I need to defend against, and which ones do I want to involve as allies, right? You just don’t see it.
Soji Apampa: I guess the reason why I’m thinking this way is because I’m also involved in looking at the question “why.” Why do people do what they do? And I’m always looking at incentive systems. So if you understand the incentives of your regulators and you understand, then you know it’s not always aligned with yours. Therefore you have to watch your back. And if you don’t have somewhere where you detail this and you check from time to time how they’re moving and their attitudes are changing, then you’d be blindsided and one day you could be hit by something that you weren’t expecting.
So it then becomes a crucial thing that if you want to play the game of staying ethical, then you’ve got to have your 360-degree vision. And you’ve got to be able to see your total market and be able to see whatever is coming. Like “Space Invaders,” like “Star Trek.” You’ve got to be able to see right around the spacecraft, not just in front of you, ‘cause a meteor can come from anywhere.
Darius Teter: Soji has found this approach indispensable, and not just for defense.
Soji Apampa: It’s not just the bad stuff. There’s also good stuff that you might fail to pick up on. So I think for me, that’s what I would say, that, yes, the whole anti-corruption thing is not always all bad. Because if you are trying to survive by doing it ethically, you have to be more innovative than those who are willing to do the bad things. Because it’s easy for them. They just go with the flow. You have to buck the trend. So you’ve got the extra energy you have to put in to make sure that you’re staying afloat and you can survive.
Darius Teter: Ultimately, Soji hopes that there won’t be corruption that businesses have to navigate, but to get there, we need some fundamental changes.
Soji Apampa: It’s a simple requirement. If there is an absence of consequences for not following procedure and doing as is expected to be done, then it will not work to reduce corruption. So if there is a consequence for the public official who decides to hide a file or do anything else, then he won’t hide the file and he would do exactly what is required. But typically, there isn’t a consequence. And citizens, especially small business, are at the mercy of these sorts of officials. Let me give you the example of the Maritime Anti-Corruption Network. In 2012, there were only eight companies, but they became very wise because the year before, 2011, the UK Bribery Act came into force.
Darius Teter: The UK Bribery Act, I think, is similar to the United States Foreign Corrupt Practices Act.
Soji Apampa: Yeah, the FCPA, yeah.
Darius Teter: FCPA. And the bind is that if you’re an American company and you are caught paying a bribe in a foreign country, you can be prosecuted in the U.S. as an official of that company. So British shipping companies were now faced with consequences — actual consequences.
Soji Apampa: Yes, real consequences. They started with a wholesale corruption risk assessment. One of the findings was that it took 150-odd signatures for a vessel to come into Nigeria’s waters and do its business and leave. That had to be cut down to start with. So they came up with standard operating procedures and they now said, well, what happens if these procedures are not respected by the officials? They agreed on a grievance reporting mechanism. They also agreed on a government agency that would act as a business ombudsman. They also agreed on some sort of accountability mechanism. How do we make sure that those who do the wrong thing are held accountable? And how do we check between us and government that progress is being made?
Darius Teter: So the first element that really comes out to me is that this risk assessment, it must have been done together, together between the private sector representatives and the public sector representatives. So that everyone would agree on the facts. And the fact is, it takes a hundred-something signatures to clear a vessel. Then working together to figure out what is a standard operating procedure that would simplify this. And then having an ombudsperson so that the private companies could go to someone if the things weren’t working the way they had been redesigned. And then some sort of accountability mechanism for when the rules are broken. And presumably accountability in both directions, right? Because these private companies acknowledged that they had been playing the game all along, and so they were part of the problem.
Soji Apampa: Yes. And they also pay fines when they don’t do the right thing. And the ombudsperson will then uphold that: “Sorry, go pay that fine. It’s legitimate. You didn’t meet the requirements.”
Darius Teter: Accountability isn’t just punishment for punishment’s sake. It’s about transparency and building trust, as this business owner learned.
Anonymous Caller 7: I discovered that several employees colluded with our buyers to steal inventory. One employee confessed and wanted to return to the company. We’re not sure if we should let this employee stay. Nobody knew if they could trust them. In the end, the team decided to bring them back. The employee paid the value of the stolen goods, and it helped him build trust and confidence among the staff. The decision showed that there is value in coming clean, and that management gives a second chance.
Darius Teter: And while change can be driven by big multinationals, it can also come from small businesses, as long as they work together. Collective action. Tell me about it.
Soji Apampa: We then created something called an integrity alliance of local actors. The one-man clearing agent, the one-man trucker who has just two trucks in the system and is moving the containers. Now we have a movement of about 150 of those clumping together with us, that now the point we are at is putting together the evidence with which to confront the authorities and do exactly the same thing. Because we found that, in fact, some of them are even bolder than the big companies to confront the authorities. But it results in hooligans with pipes in their hands, smashing the side mirrors of their trucks and killing their drivers. So there are deaths. It’s very serious repercussions on these stakeholders.
Even though they’re small, their investment is 23 million naira in a secondhand truck. So they’re very small entities, but they’ve come together as associations. And we are now helping the associations of the freight forwarders, with the associations of the transporters. So they’re coming together in that way and signing up to this integrity alliance that says, “We ourselves pledge to do it the right way and the right thing.” And whereas we’re prepared to do it, now we’re happy to club together to now resist what it is that we’re being asked to do, which we find unacceptable.
Darius Teter: I want to take my hat off to you for fighting the good fight for so long. So my question to you is: What gives you hope for the future?
Soji Apampa: The fact that Nigeria’s corruption is systemic. Because it means that if you find that lever and you can pull that lever in the system, you could actually make great change happen. So we keep poking and prodding and finding it. And recently we found one in the maritime sector. And by doing precisely what we put in the maritime sector, we saw from 266 major complaints in 2019, it fell to 128 in 2020, fell to 84 reports in 2021 and has fallen further. And that the industry acknowledged, and the support for industry has been in real time, never been done before, and these changes never achieved anywhere. So that gives me a lot of hope that you can make the change happen. So I’ve seen how it can happen. I want to take it into other sectors and see whether I can scale it.
Darius Teter: Corruption can feel insurmountable. It’s part of the culture. To survive, you have to play the game. But participation isn’t your only option. Knowing the rules can keep you out of trouble to begin with. Be aware of the slippery slope. A single facilitation payment can quickly become an expensive web of bribes. And though it may slow your growth, avoiding some clients can give you more control and peace of mind in the long run. For those already navigating a corrupt environment, conduct a stakeholder analysis to truly understand all the players in your value chain, not just suppliers and buyers. Identify allies and engage with them. Have a strategy for any gatekeepers who might want to profit off of you.
And team up with others in your industry. It is much harder to bully a united front. As you develop an ethical culture in your company and in your industry, people like Soji will continue to unravel systems at the national level. Together you can change the rules of the game. So thank you to Soji Apampa for fighting the good fight, and all the entrepreneurs who bravely shared their stories of corruption.
This has been Grit & Growth with the Stanford Graduate School of Business, and I’m your host, Darius Teter. If you liked this episode, leave us a review on your podcast app. It really helps us to share the stories of these incredible entrepreneurs with as many people as possible. To learn how Stanford Graduate School of Business is partnering with entrepreneurs in Africa and Asia, head over to the Stanford Seed website at seed.stanford.edu/podcast. Grit & Growth is a podcast by Stanford Seed. Erika Amoako-Agyei and VeAnne Virgin researched and developed content for this episode. Kendra Gladych is our production coordinator, and our executive producer is Tiffany Steeves, with writing and production from Andrew Ganem and sound design and mixing by Alex Bennett at Lower Street Media. Thanks for joining us. We’ll see you next time.
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