Abstract We examine the responses of South African
multinational enterprises (MNEs) to corruption in African
markets in the context of institutional voids. Corruption is a
source of uncertainty and additional transactional costs for
MNEs and it necessitates a strategic response. The research
employs a qualitative study of a sample of MNEs with
experience in internationalising into Africa. The results
indicate that corruption in African markets is pervasive and
closely associated with the institutional voids in these
countries. MNEs see themselves as ‘institution takers’
responding to countries’ institutional makeup at the
organisational and individual level but fail to fully appreciate
their impact on institutions both positively and negatively.
Rather MNEs focus on strategic responses at the
organisational level to address corruption operationally in
the host country. We add to the existing literature by
providing a dynamic framework of the complex webs of
association between institutions, MNEs and corruption in
conditions of economic underdevelopment. The research
suggests that MNEs do not need to get caught in a vicious
cycle whereby they perpetuate corruption in conditions of
underdevelopment and institutional voids but instead can
contribute towards a virtuous cycle through which they
institutionalise ethical foundations.