Car manufacturers BMW, DaimlerChrysler and Volkswagen; the country's fourth-largest financial institution, Commerzbank; Europe's largest chip-producer, Infineon -- five of Germany's leading firms, all members of its Dax-30 blue-chip index, have become embroiled in corruption scandals in recent months.
The revelations of kickbacks, money-laundering and paid-for sex have shocked a country that is already trying -- and failing -- to come to terms with its fall from grace as Europe's model economy and is mired in anxious depression. Not so much banana republic as bribery republic.
A handful of senior executives, including Peter Hartz, Volkswagen's personnel chief and architect of the Schroder government's labor reforms, have resigned; others are being investigated by criminal prosecutors. The nation's two-tier company board structure, including the role of the supervisory board, has come under growing criticism.
There are even suggestions that corruption is endemic in German corporate culture.
"We are speaking of the tip of an iceberg, but the problem is that we don't know how big the iceberg is," said Peter von Blomberg, deputy chairman of the German chapter of Transparency International.
He points to a prominent state prosecutor who claims corruption is so rife that in the construction sector alone the damage to the economy runs at 5 billion euros (US$6.12 billion) a year.
But he says these are crude estimates, pointing out that Germany ranks quite high for lack of corruption in international indices -- ahead of Britain but behind Nordic countries such as Finland.
Manuel Theisen, chair of business administration at Munich University, says the phenomenon is widespread but agrees that greater transparency, especially after the scandals in the US, has played a crucial role.
But he also believes that the dire economic situation has encouraged people, including investors, to come forward with allegations and says it's no accident that three of the scandal-hit firms are in the car sector.
The car industry is vulnerable because poor profit margins force purchasers to squeeze suppliers with price cuts, and they in turn are desperate to keep business. Theisen says managers do not see bribes as a crime but as a premium or even a commission for winning a contract.
Von Blomberg believes there should be a binding code, backed by sanctions or prosecution, for executives and managers.
Theisen agrees that boards are too often part of a cosy old boys' network, with members lacking the courage to put forward alternative views or too prone to turning a blind eye to the workings of the executive board -- to which they may have once belonged.
This failing has been most striking at Volkswagen, where union leaders on the works council not only negotiate pay and conditions but also sit on the board and appear content to be paid off with free trips, gifts, false expenses claims and even prostitutes paid for by the firm.
Ultimately, commentators point to a cultural gap, a failure of corporate governance, at the heart of the recent scandals. Von Blomberg proposes reforms and, above all, an external, independent ombudsman to whom whistle-blowers can turn anonymously to expose scandals without exposing themselves.
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