Harry G. Broadman of Proa Global Partners questions the motives behind a push in the House of Representatives to undo a portion of Dodd-Frank that requires certain U.S. businesses to disclose to the SEC payments made to foreign governments.
Broadman warns that companies are making payments dressed up as charitable donations or as Corporate Social Responsibility initiatives, but which actually function as bribes to secure commercial gains, especially in emerging markets. As an example he cites $175 million contributions by two oil companies to establish a research and training center in Angola to be run by the state oil monopoly, only to have that money go missing.
He argues that, “Rather than taking the ‘low road’ and igniting a race to the bottom, the U.S. would do well instead to continue to raise the bar on implementing and enforcing sound governance practices in global markets.”
