Entrepreneurs can help break cycle of corruption

A January 2026 DLSU Angelo King Institute (AKI) policy brief by Tiongco, Cororaton, and Gañgan argues that Philippine corruption is a measurable economic distortion driving low growth, rather than merely a moral issue. It finds that weak governance, limited oversight, and high-risk, high-reward structures allow corruption to persist, making reforms in institutional discipline and incentive realignment essential. Within this framework, the business community is not a peripheral actor but a central force in determining whether reform becomes durable or remains fragile. The institutionalization of reform, therefore, depends not only on government action but on a fundamental shift in how businesses, entrepreneurs, and business groups engage with the state and the market.

The policy brief shows that corruption thrives when political access becomes more profitable than innovation, efficiency, or service quality. In sectors such as infrastructure, health, and education, firms with strong political connections are often rewarded even when their performance is poor. This undermines fair competition, weakens public trust, and reduces the social value of public spending. For reform to take root, the private sector must help reverse this logic by redefining what counts as business success. By committing to transparent bidding, rejecting collusion, and refusing favoritism, business groups can set new standards of conduct, reshape market behavior, and raise the cost of corruption for both public officials and their private counterparts.

Entrepreneurs play a vital role in this shift because they are often the first to be excluded by systems that favor insiders. Lacking political connections, many small and medium enterprises are shut out of public contracts and regulated markets. The reform agenda outlined in the policy brief—focused on performance-based systems, digital transparency, and real-time verification—directly reflects the needs of entrepreneurs who depend on fair rules rather than influence. By pushing for open procurement, standardized digital processes, and consistent enforcement, they become a grassroots force for institutional reform. Their success in transparent systems shows that innovation and integrity can be profitable, offering a credible alternative to patronage-based growth.

The wider business community also carries responsibility for rebuilding institutional trust. As the paper explains, corruption raises transaction costs, fuels uncertainty, and deters long-term investment. These are not abstract effects but daily constraints on business activity. When firms support automated audits, independent oversight, and real-time disclosure, they help create a more predictable and stable environment. Over time, this stability lowers risk, attracts capital, and strengthens inclusive growth, proving that integrity is not a burden but a foundation for sustainable competitiveness.

A central lesson of the policy brief is that reform must be institutional, not personality-driven. In the Philippines, progress has often depended on individual leaders, only to fade when political priorities shift. The business sector can help break this cycle by consistently supporting rule-based systems that outlast administrations. Through chambers of commerce, industry associations, and professional groups, businesses can collectively advocate legislation, digital governance reforms, and independent oversight. When integrity is treated as a shared economic interest rather than a political stance, reform becomes embedded in law and everyday practice.

The paper also underscores that institutional change depends on private sector cooperation. Transparency platforms, geotagged project tracking, and blockchain-based procurement require firms willing to operate under continuous scrutiny. Performance-based contracts, where payments hinge on verified results, align profit with service quality and social impact. Embracing these mechanisms signals a shift from rent-seeking to value creation, where success is measured by outcomes rather than political access.

At its core, the business community’s role is to reshape the incentives that sustain corruption. The policy brief shows that corruption persists when its rewards exceed its risks. By rejecting collusion, embracing transparency, and supporting strong institutional safeguards, businesses help reverse this logic. In doing so, they make corruption unprofitable and help build an economy where trust, performance, and accountability are rewarded.

The shift from rent-seeking to reform is not only political but also economic and cultural. When business groups uphold ethical standards, entrepreneurs push for open systems, and firms commit to performance-based governance, they help create institutions that are stronger than personalities and resilient beyond political cycles. In this way, the business community becomes a cornerstone of lasting reform and a driver of long-term growth, trust, and economic freedom.

Severo C Madrona Jr. is a Professional Lecturer at the Department of Commercial Law, RVR College of Business, De La Salle University. With a public policy and business development background, he writes about strategic leadership, labor economics, and fiscal policy.