Corruption and Governance in International Business

Corruption and governance in international business encompass the study of how illicit exchanges, such as bribery and favouritism, interact with formal regulatory frameworks and unwritten institutional norms to shape cross-border economic activity. Research in this field examines the ways in which governance mechanisms—ranging from national anti-corruption legislation and international treaties to corporate compliance programmes and civil society monitoring—seek to deter or mitigate corrupt practices. Equally, scholars investigate how informal institutions, including local customs and networks, can either undermine or complement formal rules, influencing decisions by multinational enterprises (MNEs) on market entry, investment structure and risk management. Empirical work explores the effects of corruption on foreign direct investment (FDI) flows, firm entry modes and subsidiary organisation, revealing that graft does not uniformly deter investors but rather alters the composition and governance of those ventures. Case studies of high-profile scandals illustrate how collective myopia and strategic collusion can embed corrupt routines within global firms, while comparative analyses highlight divergent outcomes across regions and sectors. Practitioners and policymakers draw on these insights to refine procurement standards, strengthen due-diligence procedures and coordinate transnational enforcement. In an era of digitalisation and heightened scrutiny, understanding the interplay between corruption and governance remains essential for promoting sustainable development, safeguarding corporate integrity and securing the fair operation of global markets.

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Corruption and Governance in International Business publication trend

The graph below shows the total number of articles in corruption and governance in international business across all publications each year (not limited to Nature Index journals).

Technical terms

Informal institutions: Unwritten norms, networks and cultural practices that influence business conduct alongside formal laws.

Foreign direct investment (FDI): Cross-border equity investment by a parent firm in a foreign affiliate to establish lasting interest and control.

Joint venture (JV): A business entity created by two or more parties, blending local and foreign equity to share investment risks and returns.

Wholly-owned subsidiary (WOS): A foreign affiliate entirely owned and controlled by its parent multinational enterprise, without local equity partners.

Bribery: The offering, giving or receiving of value to influence the actions or decisions of an individual in a position of power.

References

1. Informal institutions’ influence on FDI motivation and flow: A configurational fsQCA analysis of corruption as part of the MNEs’ FDI motivation system. International Business Review (2024).
2. Private Sector Corruption, Public Sector Corruption and the Organizational Structure of Foreign Subsidiaries. Journal of Business Ethics (2019).
3. The Airbus bribery scandal: A collective myopia perspective. European Management Review (2022).
4. Exploratory analysis of the enforcement actions of the foreign corrupt practices act of the United States: the motivations behind bribery and its usefulness to enhance its prevention in business. Revista de Estudos Empíricos em Direito (2024).