Practising what one preaches isn't always easy. Multinational companies in the mainland have by and large worked hard to distinguish themselves from their local counterparts by stressing integrity and ethics.
But now, the multinational firms have become targets of Beijing's anti-corruption drive alongside domestic companies as increasing commercial bribery cases become a staple by-product of economic reform. State prosecutors say they handled 8,040 commercial bribery cases involving more than one billion yuan in the first eight months of the year, up 20 per cent year on year.
'Cases of corrupt practices in multinational companies should not come as a surprise,' consulting firm Apco's mainland managing director Patrick Horgan said. Still, 'anyone with exposure to business practice would be able to state that it is significantly lower than among Chinese companies'.
It is unclear how widespread bribery is among multinational companies, but there have been no lack of high-profile scandals lately. Last month, Beijing police detained eight purchasing managers from French supermarket chain Carrefour on suspicion of taking bribes from food suppliers.
Then reports emerged that German engineering group Siemens was being investigated over the role of its mainland medical technology division in a corruption case at a hospital in Songyuan city. About 20 staff of Siemens' mainland subsidiary had lost their jobs on suspicions of corruption.
When it comes to compliance, multinational firms differed from mainland firms because they were also subject to laws in their home countries, said Ben Miao, Clifford Chance's senior associate in Shanghai. He said there were legal risks companies could avoid by understanding the system, such as what constituted illicit gains.
'The crackdown has accelerated in the past two years and compliance is stricter,' Mr Miao added. Until then, mainland authorities apparently displayed relative passiveness towards multinational firms.
