How to Mitigate Corruption in Emerging Markets: The Case of Russia

31 Pages Posted: 7 Feb 2014  

Stanislav Shekshnia

INSEAD - Entrepreneurship and Family Enterprise

Alena Ledeneva

University College London

Elena Denisova-Schmidt

Harvard University - Edmond J. Safra Center for Ethics

Date Written: February 6, 2014

Abstract

Russian CEOs are arguably the most experienced managers in the world when it comes to working in corrupt environments. For our analysis, we gathered data from the CEOs and owners of 111 local and international companies operating in Russia. We asked them to assess their experiences with informal practices, including the extent to which their businesses are dependent on informal deals and the strategies they deploy to mitigate business corruption. The list of specific practices and strategies assembled in the pilot interviews and media content analysis has been cross-checked with the existing typologies of corruption in post-communist societies and verified through in-depth interviews.

This study presents the outcomes of our analysis, one of which is that companies tend to blame officials for corrupt activities while hiding their own internal corruption from public view. Both are dependent on the industry in which they operate, however. The paper also includes the approach we developed to understand the less reprehensible but more widespread forms of corruption such as collusion, conflict of interest, cronyism and nepotism, fraud, gifts and hospitality, lobbying, abuse of power or office, and influence peddling.

Keywords: Institutional Corruption, Russia, Informal Practices, Leadership, Business, Management

Suggested Citation

Shekshnia, Stanislav and Ledeneva, Alena and Denisova-Schmidt, Elena, How to Mitigate Corruption in Emerging Markets: The Case of Russia (February 6, 2014). Edmond J. Safra Working Papers, No. 36. Available at SSRN: https://ssrn.com/abstract=2391950 or http://dx.doi.org/10.2139/ssrn.2391950

Stanislav Shekshnia

INSEAD - Entrepreneurship and Family Enterprise ( email )

F-77305 Fontainebleau Cedex
France

Alena Ledeneva

University College London ( email )

Gower Street
London, WC1E 6BT
United Kingdom

Elena Denisova-Schmidt (Contact Author)

Harvard University - Edmond J. Safra Center for Ethics ( email )

124 Mount Auburn Street
Suite 520N
Cambridge, MA 02138
United States

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