Do anti-bribery laws work when doing international business? New research sheds light
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Do anti-bribery laws work when doing international business? New research sheds light
Research co-authored by D’Amore-McKim professor Alvaro Cervo-Cazurra looked at how anti-corruption laws impact businesses working globally. Northeastern University CEM professor of global sustainability has done extensive research on corruption and how multinational businesses react to it. Because corruption is illegal, it’s hard to confirm if corruption has happened unless the people involved are charged, professor said. The team of researchers created a database of investments of multinational countries from around the world over a span of multiple years.
In today’s global economy, companies often do business with countries that have different standards, especially regarding what’s acceptable, such as acts like bribery.
How a company engages in systems of bribery or corruption depends on the laws and norms in their home country, according to research co-authored by Alvaro Cuervo-Cazurra, a Northeastern University CEM professor of global sustainability who has done extensive research on corruption and how multinational businesses react to it.
“Companies will learn how to deal with corruption in host countries that are corrupt, and then take this learning to other countries that have high levels of corruption,” said Cuervo-Cazurra, a professor of international business and strategy. “Those that are coming from countries that have laws against bribery abroad are going to be discouraged from this behavior.”
The researchers looked at how corruption in a country can affect investments by other international businesses. Do other countries and companies avoid it or do they develop the ability to engage in it?
“Corruption happens,” Cuervo-Cazurra added. “Companies in general are discouraged by corruption. However, sometimes you have to invest in countries that have high levels of corruption, so what do you do about it? The (research question) was ‘Can we somehow try to disentangle the dirty hands versus clean hands approach of multinationals?’”
Alvaro Cuervo-Cazurra, CEM Chair of Global Sustainability and professor of international business and strategy. Photo by Alyssa Stone/Northeastern University
Cuervo-Cazurra said the team of researchers created a database of investments of multinational countries from around the world over a span of multiple years. The team then identified the effects of corruption based on previous investing behavior.
The challenge was opacity. Because corruption is illegal, Cuervo-Cazurra said it’s hard to confirm it’s happened unless the people involved are charged.
Source: https://news.northeastern.edu/2025/07/31/anti-bribery-laws-research/