Wal-Mart’s Simple Lesson: Learn To Live With The FCPA

There’s a reason why you don’t see many of the biggest U.S.-based government contractors on the FCPA top ten list (e.g., Lockheed, General Dynamics, Raytheon, Northrup, Boeing, etc.). Not that they didn’t struggle with compliance during the early years of enforcement, but they moved quickly to update their compliance and ethics programs once they saw the tide of FCPA enforcement turning. Then they moved on.

The allegations about Wal-Mart’s massive bribery scandal in Mexico were shocking, not because of the bribery itself, but because of the reported cover-up, which was cartoonish and doomed to fail, and the company’s embarrassingly weak compliance program.

What then is the real lesson of the Wal-Mart saga? That anti-bribery compliance is the way of the future and no amount of screaming by business groups is going to change that. Compliance may be challenging and may potentially result in the loss of business abroad, but it is now a way of life. Companies will either adapt or open their wallets to the U.S. government. That’s the simple lesson the biggest government contractors learned years ago.

Coming from a procurement background in which new rules/regime shifts are quite common, I see any debate about whether the FCPA hurts American enterprise or reduces overseas corruption as noisy, but as ultimately having little impact on anti-bribery enforcement.

That’s why it’s time for commercial companies to learn what sophisticated government contractors have known for years — update your compliance programs, train your employees, and move on.
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Jessica Tillipman is a contributing editor of the FCPA Blog. She’s the Assistant Dean for Outside Placement and a Professorial Lecturer in Law at The George Washington University Law School. She also teaches an Anti-Corruption seminar that focuses on corruption control issues in government procurement.