Future-proofing South African business against corruption

The document examines corruption in South Africa as a collective action problem and proposes two primary solutions: anti-corruption collective action and the implementation of effective good faith compliance programmes. It highlights that while corruption may offer short-term gains, long-term costs include decreased productivity and slower financial growth. The brief identifies 'virtuous circles'—such as the corporate renewal of EOH and new legal frameworks like Section 34A of the Prevention and Combating of Corrupt Activities Act—that can shift the private sector toward integrity. It specifically emphasizes the vulnerability of small, medium and micro enterprises (SMMEs) and recommends tax incentives and capacity building to support their compliance efforts.

• Corruption in South Africa is framed as a collective action problem where systemic corruption and weak political will lead individuals to choose corrupt alternatives because the short-term costs of honesty are perceived as too high to change the overall system.
• Research indicates that corporate integrity provides long-term financial advantages, whereas corruption leads to decreased productivity, slower financial growth, and more expensive access to capital.
• Anti-corruption collective action, where business, government, and civil society collaborate to raise integrity standards, is presented as an effective tool. The Maritime Anti-Corruption Network (MACN) is cited as a successful global example, having reduced bribery in Lagos Harbour, Nigeria, by 96.2% between 2019 and 2022.
• The company EOH serves as a benchmark for corporate renewal in South Africa, having transitioned from a major corruption scandal to profitability by 2023 through the implementation of stronger controls, ethics training, and digital audits.
• New legal mechanisms in South Africa provide incentives for compliance. Section 34A of the Prevention and Combating of Corrupt Activities Act allows companies to defend themselves against criminal liability for bribery if they can prove they had an effective anti-corruption compliance programme in place.
• Small, medium and micro enterprises (SMMEs) are disproportionately harmed by corruption in global supply chains, which increases their costs and slows their growth due to limited resources and low risk awareness.

APA

Ashton, C., & Klazar, E. (2025). Future-proofing South African business against corruption. Institute for Security Studies. https://issafrica.s3.amazonaws.com/uploads/pages/1762156738838-PB-205.pdf

Chicago

Ashton, Colette, and Erin Klazar. Future-proofing South African business against corruption. Institute for Security Studies, 2025. https://issafrica.s3.amazonaws.com/uploads/pages/1762156738838-PB-205.pdf.

Wikipedia

{{cite report |last1=Ashton |first1=Colette |last2=Klazar |first2=Erin |title=Future-proofing South African business against corruption |publisher=Institute for Security Studies |date=2025 |url=https://issafrica.s3.amazonaws.com/uploads/pages/1762156738838-PB-205.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{ashton2025futureproofing, author = {Ashton, Colette and Klazar, Erin}, title = {{Future-proofing South African business against corruption}}, institution = {Institute for Security Studies}, year = {2025}, url = {https://issafrica.s3.amazonaws.com/uploads/pages/1762156738838-PB-205.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }