Corruption and bribery impact businesses directly and indirectly and below is a list of the negative effects of corruption on the major systems of our modern society. Legal: Corrupt practices undermine the rule of law, undermine trust in public institutions, and challenge democratic principles. According to the Foreign Public Officials Corruption Act, there are many legal fees and penalties for those who violate any part of the act, including; prison, fines and bad reputation of the individual and the company (Government of Canada, 2014). Corruption can affect every sector and level of government, from the highest executive, legislative and judicial branches to regional and local officials, thus reducing its efficiency. It therefore represents a potential threat to all sectors and institutions within a country. Greater corruption in a society means that the government has to spend more taxpayer money on anti-corruption practices that affect every person's disposable income. Corruption is directly related to the rate of criminal activity and ends up fueling the black market and organized crime. Governments around the world are taking such notice of the increase in corruption and its negative effects that many institutions have emerged to slow down and abolish corrupt practices in businesses. This makes business much more complex due to all the policies and laws that must be complied with first domestically and then abroad when venturing (UNglobalcompact, 2013). Financial: A corrupt company will lose the respect and trust of customers, requiring company management to spend valuable time and resources to build customer loyalty and demonstrate that they are still running a profitable business. The public, over... half of the paper ......informs the perception of the stability and quality of investment potential in host countries. Investors may prefer not to invest due to the additional costs. Foreign investors generally avoid engaging in corruption because it is considered wrong and can create operational inefficiencies. Care must be taken, however, to generalize the causes and effects of corruption to all countries. Corruption can become an integral part of a country's life and the causes and effects are visible in its history and society. Since there are different types of corruption, there are also different solutions. Efforts to improve the quality of institutions (in this case, in order to decrease corruption) can help developing economies receive more foreign direct investment, and thus help them enjoy higher GDP per capita and a higher standard and quality of life. (talkingbusiness.net, 2014) .