A big fine for Rolls-Royce is not its only worry

FOR those who still associate Rolls-Royce with its past as a posh carmaker, its home on a scruffy industrial estate comes as a shock. Yet it is there the engine-maker assembles the Trent XWB, the second-biggest commercial jet engine in the world. Some components are made to a tolerance of 50 microns—the width of a human hair. The job of running the firm is a bit messier.

On January 16th, in a deal with American, British and Brazilian regulators, Rolls agreed to cough up £671m ($809m) to settle allegations that it had in the past secured sales with bribery. The fine is the largest-ever imposed by Britain on a firm for criminal conduct. But given the wrongdoing the deferred prosecution agreement outlines, the firm got off lightly (the co-operation of the company’s more recent management helped). It admitted a dozen counts of corruption and bribery in seven countries, spanning decades. This included giving officials money, hotel stays and even a luxury Rolls-Royce car to secure engine sales. Rolls has since cut its use of the freewheeling third-party consultants who got the company in trouble, and promises better oversight of all staff. If it errs…Continue reading

from Business and finance http://www.economist.com/news/business/21715001-turbulence-worlds-second-largest-engine-maker-big-fine-rolls-royce-not-its-only?fsrc=rss

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