Is official corruption/bribery a bigger problem in Japan than in the United States?

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 a post in quora: Is official corruption/bribery a bigger problem in Japan than in the United States?

This is a very complex subject and I answered about this question in a post in quora.

Of course, as in any country, you will always find cases of corruption/bribery and in general it does not remain unpunished in Japan.
It can take time before it is discovered but at the end there are sanctions. I know of a case of high level manager in a giant conglomerate who took some money from suppliers to give them preference for some business. He has been staying for few years in a jail.

We see in Japan a very big focus on compliance:

  • Customers (especially purchasing/procurement departments) are told not to accept gifts from suppliers (or it should have a value estimated at under 2,000JPY – well under 20 USD)
  • I had a case recently of a customer I took to dinner. He requested me to see the bill at the end of the dinner to report to his management how much was invested for his presence…
  • Public officers (i.e. government related) are asked to report on a monthly basis how much money they got from the industry for sponsored activities (i.e. a speech in a symposium) and in general there is a limit to the amount of compensation they can receive.


On another level, we see different ways to give preference to business in Japan.


There is a myriad of what we call trading companies/dealers/distributors in Japan.
Often when you want to do some business with a company (end-user) they ask you to go through their official distributor/trading company.
It’s somehow like outsourcing their procurement activity.

One customer could have a relationship with one main distributor and this distributor would purchase all products from several manufacturers on behalf of the customer. (in the life-science industry, I know a trading company handling the products from almost 1000 manufacturers)

Sometimes you have to deal with distributor, sub-distributor, sub-sub distributor and so on before to reach the end-user. No wonder that final prices are often inflated to an extent that we cannot see in US or Europe.

Why?


There is a common belief that at some time in Japan there was not enough job for everyone. So early a “work-sharing concept” was designed in Japan.
Large companies were giving job to their local suppliers or distributors to help develop the local economy.

Even now, even multinational companies are asking you to have goods purchased by their assigned distributor, some times a Mom and Pop company near their place.
Of course, this distributor would bring some service on top of that. They would visit the customer everyday, manage their stock and deliver the goods.

So as a conclusion, this cannot maybe called bribery/corruption but it is a stealth way to give some preference to some suppliers.

 

if you are interested in other posts I submitted to Quora about business life in Japan, you can refer to this page: http://directionjapan.com/started-to-contribute-to-quora/

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About gaishikeiman 32 Articles

French citizen in his forties living in Japan.
Almost 20 years working for foreign companies in Japan.
I have an engineering background with an extensive sales experience in highly regulated industries. I am currently the representative director and managing director for an European company’s subsidiary in Japan.
I have seen all the lows and highs of foreign companies in Japan since late 90ties.
Feel free to contact me wether you are looking for opportunities in Japan.

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