In Russian business the Motto is: Legal Shmegal

Paul Goble reports:

More than two-thirds of Russian businessmen say playing by “the rules of the game” is more important in their work than obeying the law, with only one in five saying that obeying the law takes primacy over such informal arrangements, according to the results of a poll released at the end of last week.

Commissioned by the Russian Union of Industrialists and Entrepreneurs, the poll by the All-Russian Center for the Study of Public Opinion (VTsIOM) asked 1200 businessmen in the largest sectors of the Russian economy in 40 subjects of the Federation about their attitudes about law and informal rules.

“Two-thirds of the participants of the investigation [conducted last summer] are convinced,” VTsIOM said, “that the priority for [their] enterprises is the observation of accepted ‘rules of the game in the business community’ (69 percent),” while 20 percent said that their priority is “following the letter of the law.” A survey VTsIOM carried out a year earlier, the polling agency said, found that 45 percent thought “rules of the game” were most important, while 41 percent said obeying the law was the most important, a remarkable shift given President Dmitry Medvedev’s frequent invocation of the need for Russia to become a law-based state.

One reason Russian businessmen and entrepreneurs say rules of the game are a more important guide to action than law is that the “level of the development of the legislative base regulating their activity is relatively low. Fifty-eight percent say it is “below average,” while 41 percent say the opposite. But other findings of this poll suggest that the problem is deeper than that: “The majority of representatives of the business community (59 percent) in 2009 noted the low level of legal protection for private property,” although the VTsIOM report said that this number was down slightly from the 65 percent who said that in 2007. Only 14 percent said law protected property.

Such figures are consistent with recent reports that many Russian businessmen do not see a future for themselves or their children in Russia and prefer to keep their capital abroad and send their children to live and study there. But precisely because they are being reported by VTsIOM, they may be taken seriously by the powers that be in Moscow.
That is because VTsIOM is widely viewed as being closely connected with the Kremlin and the upper reaches of the Russian powers that be, a very different status than many of the other institutions and agencies that have conducted surveys and other studies in this area in recent times.

But however that may be, the attitudes this poll highlights suggest that moving the Russian Federation in the direction of a law based state will be a long and difficult process, one in which the introduction of well-drafted laws and a genuine commitment to enforcing them will be only part of the solution. And most troubling of all, the trend VTsIOM pollsters found in which a larger share of Russian businessmen now say following the rules of the game is the most important than did a year earlier — and a lower share say obeying law is primary — suggests that the road toward rule of law may be even harder than many now think.

One response to “In Russian business the Motto is: Legal Shmegal

  1. Dmitry Kaganovitz

    The whole “law quality” story is pretty much irrelevant, wonder why it gets this much attention. Law does protect property in Russia, and while it is not exactly perfect, it is more or less OK for a country that only had 20 years to develop a contemporary legal field.
    What is the real problem, and why I say that legislative base doesn’t matter much, is that pretty much nobody cares about it. Clearly not judges in any “worthy” (… of the attention of powers that be) case. Somewhy, the situation if often misrepresented (by both sides of Putinism) as if courts are following the law but the law is crap, while the actual problem is that courts are nowhere near guaranteed to follow the law.
    Say, everyone’s belowed Khodorkovsky case. So, right now by a legislation people should not be inmprisoned for economical violations… but his judge is having none of that. And it’s not like the wide public coverage stops that. Now imagine what happens in less publicised cases. A businessman may be innocent as Mother Theresa, there may exist exactly 0 evidence to any wrongdoing – yet the prosecutor will come to a judge asking for a warrant and get it. Not like the problem of laws being ignored in courts could be helped by adjusting said laws, huh.

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