There are many types of corruption, which is an umbrella term used to describe a variety of actions taken that often lead to personal gain, usually in the form of cash or power.
The definition of corruption is not agreed-on nor universal, however Transparency International defines the term as “the abuse of entrusted power for private gain”. It involves subversive or secretive actions used to influence others and can occur in a huge variety of organisations and places in society. These include private businesses, public institutions, governments, and judiciaries.
Corrupting practices in businesses can occur at any level but occur most frequently in higher offices of power involving executives or managers.
This type of allegation is extremely serious and damaging to all businesses, as penalties under the law may include unlimited fines for businesses and imprisonment of individuals. As well as this, the business found guilty will suffer from huge reputations loss, meaning fewer people use their services and investors losing interest.
What are the Types of Corruption?
There are two main categories that all examples of corruption fall in to, and these are grand and petty.
Grand exploitation, as per the name, occurs in the higher echelons of government with far-reaching consequences for the public. Resources used for healthcare and other public services are diverted either directly into the pockets of government officials or used in a way that they profit from them. As a result, the public suffer, and the poorest in society disproportionately so.
Corrupted petty practices are an “everyday abuse of entrusted power by low- and mid-level public officials in their interactions with ordinary citizens”.
The following are some types of corruption that fall into the above categorisations:
In addition to individuals, businesses can also be victims of fraud, as criminals may clone and impersonate organisations online using fake websites which can look extremely accurate. Charities are particularly vulnerable as fraudsters may get the public to donate to what they think is a good cause when it is actually going into the back pocket of a criminal.
As outlawed by the Bribery Act 2010, bribery occurs when a person offers an incentive to another individual, looking to influence their behaviour or thoughts in a particular way. Bribes do not have to be made with a cash reward, as any valuable item including tickets to an event can be used.
Bribery can occur in businesses when an employee offers an incentive to a person in a higher office, in a bid to get a pay rise. Organisations may also be wary of bribing foreign public officials, as any attempt to speed-up businesses negotiations by offering incentives can be illegal.
Similar to bribery, extortion is the practice of getting something you want (usually cash or power) by threatening others. It is covered by UK blackmail laws like the Theft Act 1968.
Extortion may occur in an organisation where an employee is looking for a promotion or pay-rise and has to threaten others in order to get it. Blackmail can also be a form of extortion, and may occur when someone pays-off an individual in order to prevent specific information from being released to the company.
- Nepotism or cronyism
Although not strictly illegal in UK law, nepotism and cronyism occur when an employer favours friends or relatives for certain jobs over applicants from the general public. Although this can be described as discriminatory recruitment practices and fall under UK equal employment law, there is no specific piece of legislation that outlaws the corrupting practice.