Abstract
This thesis presents the analysis, findings, contributions and potential implications of the empirical data that emerged from a primary qualitative investigation into how senior managers of Portuguese Multinational Corporations (MNC) perceive and respond to corporate corruption. Through an original systematic approach to analysis, data was subjected to two decision and economic theories: Cooperative Game Theory (Binmore, 1994, 1998b) and the Risk, Uncertainty and Profit Theory (Knight, 1921; Watkins and Knight, 1922). In combination the key concepts from these theories, which are the unique advantages gained from cooperation in formal rules-based games and the differentiation between risk and uncertainty in probability judgements, make up one dimension of an a priori thematic template that considers interviewee responses within two informational environments: the states of clarity and ambiguity. Conducted in Portugal, this research identifies how individuals in business struggle to adequately match complex rule-based standards with informational ambiguity. It seeks to avoid simply defining or highlighting recent examples of corporate corruption but expands on how agents respond to ambiguity through heuristic interpretations of their environment that may be in breach of the pre-agreed rules. Study elucidates why the demands for rule adherence, based on an assumption of perfect information and logical deductive rationality, are in contradiction to how individual agents commonly make judgements. Key findings draw attention to the need for a greater reliance on individual discretion in the face of observed asymmetry between formal and informal approaches to maintaining organisational financial integrity. From these findings two conceptual frameworks, which can both contribute to theory and practice, are presented as a way to better understand how each system is influenced. It is presented that without acknowledging the important role of individual discretion within formal systems, and without greater efforts to align these two systems, the threat of corporate corruption is likely to persist.