By Rachel Doherty
New research by Dr. Kaishu Wu from the School of Accounting and Finance finds that when companies are caught bribing foreign government officials, politically connected firms consistently receive lower penalties — even when the misconduct is equally serious.
The study analyzed 151 U.S. enforcement cases spanning 25 years and raises important questions about fairness and transparency in anti-corruption law.
Related research
Explore additional studies from SAF researchers connected to this theme and their broader implications for business, policy and society.
To Punish or Not to Punish? The Impact of Tax Fraud Punishment on Observers' Tax Compliance
Farrar & King — Journal of Business Ethics, 2023
Seeing someone punished for tax fraud makes the rest of us more likely to follow the rules — but only when we think they genuinely deserved it. And when fraudsters walk away unpunished? Compliance falls regardless. The research sends a clear message to tax authorities: visible, fair consequences matter.
Thorne, Fiolleau, MacTavish, Nappert & Khatoon — Journal of Business Ethics, 2023
Accountants have always been bound by client confidentiality but a 2018 update to the global ethics code gave them explicit permission to report wrongdoing to authorities when the law is being broken. This study finds that the change is working: professional accountants feel a stronger obligation to speak up than they did before.
The Importance of IRS Enforcement to Stock Price Crash Risk: The Role of CEO Power and Incentives
Bauer, Fang & Pittman — The Accounting Review, 2021
When executives know the tax authorities are watching, they're less likely to hide bad news from investors, and that makes stock prices more stable. This research shows that rigorous tax enforcement does more than collect revenue; it keeps corporate leaders honest in ways that protect ordinary shareholders.