China Employee Corruption Runs Deep

China Employee Corruption Runs Deep

China Employee Corruption is often unseen but still costing a lot of money. I know a company where an amazingly honest purchasing manager was accused by the compliance department of lying to get the job. They say she got fired for stealing at previous job.  We know this woman is an extremely honest and capable manager.  SHI Group had placed her over the HR manager’s strong opposition.  We had the data to show she was honest as always. We saved her job.  People leaving the company had turned in this shocking story, and said they first hand knew.  This purchasing manager gets along well at the company and is highly valued. She manages $100M annually in purchasing.

What Might Be the Real Story?

Why would someone try to get her fired?  Would it not be more likely that someone who could get some purchasing money wanted the person leaving to say this as could not get accused?  The purchasing supervisor may see ways to pilfer $1M a year if the honest purchasing nanager is gone. That is a fortune untold for a purchasing person in any country and certainly in China. It could potentially be easy. Especially, if he has relatives who want to be suppliers.

It could also be a strong HR manager who sees that he can recommend a new purchasing manager as they recruit internally. He can get a cut and perhaps always did before this present person was placed.  The honest purchasing nanager may have blocked the HR getting money from candidates.   The HR Manager can always get a purchasing manager fired if he has the data he was fired last time. Even 0.1% of $1M is a lot of money the HR could collect in some caaes.

Actually, there are a lot of possible scenarios more likely than someone leaving wanted to throw darts at an unrelated manager.

Having said this, I can hear the sighs from readers. Its like you do not want to know. It is too complicated if it is true. In China, it is often true.  When getting even 1% of the purchasing spend for yourself is possible, more than one hand might collude.  It is very hard to track. See also 45% China Sourcing Corruption

China Employee Corruption – Example

I recall a case before all got digitalized where an apparently honest finance manager named Mike in a start up recommended a commercial insurance company to buy required insurance for all the staff. The insurance woman came and explained all to the staff and, as things were busy, it was quickly signed and payments started to go out for it.   A year later, they found the insurance woman was Mike’s wife, and there was no insurance!

This was a foolish scam and so got caught, but many much more cunning plans are not caught and harm cannot be reclaimed.

There is a lot of money going under the bridge in Western companies in China.   Hiring honest people is the key, and not tempting anyone with weak systems is the next step.


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Posted in: China Recruitment - Getting Good People

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