Explicating factors for companies' inclination towards corruption in Operations and supply chain management: An exploratory study in Germany

The literature on corruption is rich in works focusing on individual and organizational aspects. However, existing research is void in studies that specifically deal with factors for a company's inclination towards corruption in operations and supply chain management. The present paper fills this gap by explicating why some firms are more prone to corruption than others. Within this context it is our objective to explore the structural and organizational bases for companies, especially their purchasing units, to engage in corrupt business practices. Grounding our work in principal-agent theory and the fraud triangle, we suggest that the factors of organizational complexity, corporate culture, internationality and functional complexity all influence a firm's inclination towards corruption, which in turn should manifest itself in the presence or absence of corruption control- and prevention mechanisms. This framework is tested with data collected from 104 purchasing managers in Germany, and implications for both theory and practice are highlighted.