In 1977 the US government passed the FCPA law aimed at stemming foreign corporate corruption and to raise corporate America’s integrity rating to a higher level. Whereas the public sector in the United States has enjoyed a fairly high integrity rating for many decades, America’s corporate sector was considerably lagging behind. Economists identified corruption as one of the key obstacles to sustained economic growth and were robust in trying to reshape the corporate culture of Compliance and Ethics.

Anti-corruption regulations for Western corporations created the obligation to implement compliance programs and to introduce compliance officers who are responsible for preventing, finding, and fixing problems. This was the US government’s way of making companies responsible for active prevention of violations of laws and standards, fraud or corruption. Companies were made responsible not only for violations but for not having effective prevention systems in place. Corporate compliance programs and officers who implement activities based on building an ethical culture, enhancing rule of law, education, risk assessment, reporting and investigating, and assessment and monitoring of third parties have become the most effective system against market fraud and corruption in history.

Since that time the corporate Ethics and Compliance model has been effective in spreading the rule of law and a climate of integrity within the business community. For many transitional and developing countries, however, this is a near impossible achievement due to the high level of corruption in the public sector.  The business community faces many challenges in living up to high compliance and ethics standards when the public sector erodes fair market play with a culture of corruption.