Criminality and Business Strategy: Similarities and Differences PDF
Preview Criminality and Business Strategy: Similarities and Differences
JohnZinkin,ChrisBennett CriminalityandBusinessStrategy John Zinkin, Chris Bennett Criminality and Business Strategy Similarities and Differences ISBN978-3-11-071189-9 e-ISBN(PDF)978-3-11-071215-5 e-ISBN(EPUB)978-3-11-071216-2 LibraryofCongressControlNumber:2022940548 BibliographicinformationpublishedbytheDeutscheNationalbibliothek TheDeutscheNationalbibliothekliststhispublicationintheDeutscheNationalbibliografie; detailedbibliographicdataareavailableontheinternetathttp://dnb.dnb.de. ©2022WalterdeGruyterGmbH,Berlin/Boston Coverimage:PeopleImages/E+/GettyImages Typesetting:IntegraSoftwareServicesPvt.Ltd. Printingandbinding:CPIbooksGmbH,Leck www.degruyter.com Advance Praise for Criminality and Business Strategy: Similarities and Differences “Allgreatworkscomeintrilogies.Thefirstmakesthename,thesecondconsolidates it, and the third either takes ittogreater heights or disappoints. Havingmade their nameinThePrinciplesandPracticeofEffectiveLeadership,corporategovernanceex- pertsJohnZinkinandChrisBennetthaveembarkedontwosequels,Criminalityand Business Strategy: Similarities and Differences, to be followed by The Challenge of LeadinganEthicalandSuccessfulOrganization(tobepublished). Criminality and Business Strategy: Similarities and Differences is a subject most peoplewouldprefertosweepunderthecarpet.Buttheissueofcriminality,bystates, firmsandindividuals,liesattheheartofgoodleadership.Justasethicalindividuals findithardtosurviveincriminalfirms,sodofirmsfindithardtooperateincriminal states,oratleastverycorruptones. Thisbookreviewscasesofstatecriminality,organizedcrimesfromMafiaandTri- ads to Yakuza, and draws insights that are invaluable to the practicing corporate leader.No leader can be naïve as tothe challengesof operatingincorruptingenvi- ronmentsandthisbookprovidesgoodadviceonhowtodiagnoseandthinkthrough criminalityincontextanddetail.Thebestbusinessessurviveandprosperbecauseof strongethicsandprofessionalteamwork.Tobuildthatteamwithvaluesisthehall- markofallgoodleaders.Thatiswhythethirdbookinthistrilogyiskeenlyawaited.” –AndrewSheng,formerCentralBankerandChairman, SecuritiesandFuturesCommission,HongKong “Theauthorsofthisbookareexcellentdebaters–theyexamineargumentsfromall angles to ensure that they are completely watertight. Here, they have taken a step backanddiscussthebehaviorsandcharacteristicsofrecognizedgovernments,com- paringthemwiththebehaviorsoforganizedcrimegroups.Takingthisverydifferent perspective generates very surprising insights into the functioning of government, the ‘monopoly of violence’ which governments claim, and the similarities between the operational strategies of governments and crime organizations. It brings the reader,mentally,intoaspacewhichfewhaveexplored,butoncethere,allowsasur- prisingsetofnewinsightstoemergewhilereadingthebook. Inaworldwhichisincreasinglydominatedbyautocratic‘bigmen’,anddemoc- racy appears to be struggling to function effectively, these insights are particularly important, an essential underpinning of thought for policy makers, politicians and societalreformers.Thereaderwillhaveassumptionschallenged,the acceptedover- turned, and the unacceptable contrasted with the acceptable. Reading this book, I waschallenged and surprised – but wasnot able to reject the arguments made. At https://doi.org/10.1515/9783110712155-202 VI AdvancePraiseforCriminalityandBusinessStrategy thesametime,thebookispractical,downtoearthandthelessonscanbeappliedto improvetheethicsofbothbusinessandgovernmentorganizations. –EdwardClayton,Partner,CapitalProjectsandInfrastructureLeader, PwC,MalaysiaandVietnam “InCriminalityandBusinessStrategy:SimilaritiesandDifferences,andinparticularin itsconcludingchapter,JohnZinkinandChrisBennettmakeitabundantlyclearthatif a legitimate business isonly committedto makingprofits with little or no regard to ESG goals, there will be little todistinguish it from organized crime anditthus may runtheriskofforfeitingitssocial’licensetooperate’.” –DatoDrR.Thillainathan,DirectorofGentingBerhad, PublicInvestmentBankBerhad,IDEASPolicyResearchBerhad “CriminalityandBusinessStrategymademequestionmybehaviorinwaysIwasnot expecting,and cometo uncomfortable conclusionsasa result.I considermyself an honest businessman.However,thisbook demonstratestomethatIexist ona spec- trum.Mytransgressionsarearguablyharmless,butI,likeeveryoneinbusiness,have concludedthattherearesomerulesthatareokformetoignore.Or,toputitanother way,thatIamentitledtoignore.Irealisethatthereisacorrelationbetweenmyenti- tlementandmylevelofinfluenceandfinancialcapacity.Themoreonehas,themore rulesonemayignore,andthelessonehas,themoreconstrainedoneisbytherules. Hardlyalevelplayingfield,butshockingwhenconsideredincontextofwherewesit onaspectrumofcriminalityandbyextensiontherefore,themorewealthyorinfluen- tial one becomes, the increased likelihood of also being more criminal. This book challengesmetodecidewhetherthisisthesocietyIwanttoparticipatein,orindeed topassontomychildrenforthemtobepartof.” –TonyHeneberry,FounderofCEOSolutions Acknowledgments We were helped by many people in developing our thoughts, refining our argu- ments,andstructuringthecase.WewouldliketothankDrGaryDirksandProfes- sorSanderVanDerLeeuwfortheirearlycommentsonthepotentialforcriminality in the political process. We would like to thank Professor Anna Sergi for her work and insights into organized crime in Italy, and in particular for her work on the ‘Ndranghetawhichwehaveusedinthebook.Wewouldalsoliketothankthefol- lowing for the time they invested in reading our drafts to ensure that the case we make iscorrect, clear,and, relevant; based on their respective experiences as aca- demics,companydirectoroflongstanding;seniormanagementconsultingpartner; entrepreneur; central banker and capital markets regulator; and lawyer: Professor John Rudd, John Colvin, Dato Dr R. Thillainathan, Edward Clayton, Tony Hene- berry,TanSriAndrewSheng,andSujataShekarNaik.Ifwehavemisunderstoodor misrepresentedtheirviews,thefaultisentirelyours. WewouldliketothankStefanGiesen,ourexcellenteditor,forchallengingour assumptionsrobustlyandconstructively,includingsimplifyingthestructureofthe book. We are grateful to Mary Sudul, our copy editor, whose meticulous attention to detail and care in improving the text makes the book all the better. We would liketothankJayaDalalforherexcellentcoordinationofproduction,asusual;and MatthiasWandforfinalproduction. JohnZinkinandChrisBennett KualaLumpur,Malaysia https://doi.org/10.1515/9783110712155-203 Contents Acknowledgments VII Introduction XIII Chapter1 TheCrimeContinuum:TheRoleoftheState 1 StatesasSuccessfulCriminalEnterprises 2 “Force”Theory 2 “Conflict”Theory 4 The“Jealous”State 5 StateCommittedOrganizedCrimes 9 DefiningCriminalBehavior(CB) 14 Felony 14 Misdemeanor 15 Offense 15 Infraction 15 Wrongdoing 15 Chapter2 TheCrimeContinuum–TheRoleofOrganizedCrime 21 DefiningCharacteristics 21 Mafia 24 ChineseTriads 29 HongKongTriads 32 TaiwaneseTriads 35 Yakuza 37 CrimeThatIsOrganized(CTIO) 42 Chapter3 TheCriminalHarmContinuum 49 BreakdowninLawandOrder 49 EconomicHarm 51 Wars 51 CivilWars 53 FinancialHarm 55 Fraud 55 Bribery 55 Corruption 57 X Contents MoneyLaundering 58 CriminalEconomicHarm 60 SocialHarm 60 OrganizedCrime 60 ShadowEconomy 61 Chapter4 DoesthePunishmentFittheCrime? 67 Government 67 EnforcementofSanctions 68 Impunity 68 RegulatoryCapture 69 BriberyandCorruption 71 Inappropriate“Ecosystem” 73 Indifference 75 SocialAxiomsandAssumptions 75 Culture 75 Media 77 Chapter5 TheCriminalStrategyExternalContinuum 81 “PESTLE”Framework 81 PoliticalEnvironment 82 EconomicEnvironment 84 SocialEnvironment 87 TechnologicalEnvironment 96 LegalEnvironment 98 Environment 101 The“FiveForces”Framework 103 Head-to-HeadCompetitors 104 SupplierPower 104 BuyerPower 104 NewEntrants 104 AlternativesandSubstitutes 105 Chapter6 TheCriminalStrategyInternalContinuum 113 Mission,Vision,andValues 113 MissionandVision 113 HenryFord 115 MarksandSpencer 115
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