Petty nepotism in Switzerland

Switzerland's failure to advance in Transparency International's anti-corruption rankings has been partly blamed on the country's ongoing culture of petty nepotism.

The close ties between political and business leaders are often blamed for many cases of impropriety.

Switzerland has nowhere near the scale of corruption that plagues many developing economies but Transparency says that, as with many developed nations, corruption persists in a more subtle form.

“We have in Switzerland what I would call networks of influence,” says Stephan Garelli, a professor at Lausanne’s International Institute for Management Development.

“People work together. They have contacts that they may have developed on other occasions such as in the army.

Scratch my back

“[And that leads to situations] for example where you have cross memberships of different boards; where I sit on your board, you sit on my board and, therefore, there is a close relationship between our companies.”

However, Garelli doubts this leads to embezzlement and theft. “I think it is much more a matter of influence and helping each other.”

Transparency Switzerland – which has ranked Switzerland 12th in its global study – points out that around 40 cases of official corruption reach Swiss courts every year.

The watchdog estimates that the actual instances of corruption are “many times greater”.

“These disappear under a cloak of silence and therefore rarely see the light of day,” Transparency says in its survey.

Meet my cousin

The traditional explanation for what amounts to Switzerland’s home-grown “old boys network”, lies in what Transparency calls an embedded culture of “Vetterliwirtschaft” – loosely translated as “my little cousins’ business circle”.

These are the circles of associates, friends, family and, most importantly – ex-military colleagues – that help grease commercial and political exchanges.

And while for many Swiss, the links are a harmless by-product of a small country; they do have a serious impact on the economy.

“Nepotism, even if it doesn’t involve huge sums of money, nevertheless has negative implications… [of which] taxpayers and consumers are the victims,” says Philippe Lévy, president Transparency International’s Swiss chapter.

That nepotism also need not involve large bribes or kickbacks. A practical consequence of a close-knit nation is that potential whistleblowers take massive risks in speaking out against corruption.

Lévy said a well-placed whistleblower who reveals wrongdoing is likely to see his future job prospects substantially reduced.

swissinfo, Jacob Greber