There is one word that should start any real discussion about corruption in Thailand, and that word is Sakdina (ศักดินา). Sakdina is a historical system of social hierarchy that went so far as to assign a specific numerical rank to every person in Thailand depending on their status. Although officially abolished, it persists, in a less recognizable form, to this day. Tourists and first-time visitors typically find the graciousness that arises out of this feature of Thai culture extremely charming, but don’t realize that it can be employed to deflect when uncomfortable questions are raised. And it is routinely ignored or misunderstood when compliance officers and investigating counsel are making their initial visits to Thailand.
Its presence in modern Thailand is evidenced by the extraordinary deference extended to visiting foreign and local managers. Even email exchanges, when carefully examined, will often reveal rigid power structures where superiors require, and juniors provide, confirmation of where each of them sit in the social hierarchy through the use of seemingly trivial salutations. A wide scale use of salutations such as “Pee” or “P’” (respected elder) by more junior employees reflect the tremendous importance of status in a Thai organization. Sakdina also manifests itself in the pervasive patron-client relationships, or bunkum, that plague Thailand and strictly govern relationships between young and old or rich and poor. These indicia of undue deference are not proof of corruption, but they are red, or at least orange, flags of corruption. Why?
Sakdina compromises candor. It’s unrealistic to expect a subordinate to give a fulsome and honest account of his or her superior’s dealings with government officials and third parties when that subordinate has been taught from birth to always defer to superiors no matter what. It’s also unrealistic to expect a subordinate to give a fulsome and honest account about even ordinary office dealings in the face of this extraordinarily powerful cultural restraint. Thailand’s poor ranking on a myriad of transparency indices is no accident. And every compliance investigation involving Thailand should make this feature of Thai culture paramount by, among other things, recognizing the tremendous significance that this sort of extreme, often misguided and less than transparent deference plays in Thai institutions. Compliance officers and investigating counsel must start by understanding who you are talking to and the position of that person in the opaque hierarchy of Thai institutions.