A housebuilder, now sadly deceased, once recounted the tale of how he won permission for luxury flats in Europe by agreeing to sponsor the local football team and paying for the mayor and his family to stay at The Ritz for a month. That was 20 years ago, but international construction has always had a whiff of corruption about it. Only last week, an official in Lesotho was jailed for 18 years for accepting £3m in bribes, and the state prosecutor is threatening to charge Balfour Beatty and others over the affair. The firms point out that no charges have been laid, and that earlier ones were dropped, but the story highlights the increasingly close scrutiny of construction's ethics. This is partly the doing of the global media, and partly of internet-powered pressure groups. One of them, Transparency International, has branded construction the world's most corrupt industry, and Greenpeace and Friends of the Earth are on a roll after successful campaigns against two Turkish dams, which – they claimed – would have left thousands of Kurds homeless. The firms involved, Amec and Balfour, have been demonised ever since. But the activists aren't restricting their gaze to giants: Wates Special Works and architect John Simpson have been attacked over the use of hardwood in the Queen's Gallery, even though the Palace says there's no proof.

If the industry is not careful, its reputation as venal vandals will become even stronger. With pressure groups able to exchange information freely, it is now impossible to apply one set of moral standards in the UK and another abroad – whatever the apparent "rules" of the local market. If you're caught bribing a mayor in some faraway town, you face blacklisting by the European Union and the World Bank. Equally, the old defence of "don't blame me, I'm only the contractor" over environment-damaging schemes won't wash any more.

As well as being smarter and better organised than the dog-on-a-rope road protesters of the 1990s, today's activists can count on far more public and political support. Even the government has an ethical foreign policy, although it faces an interesting test over arms deals to India and Pakistan. In the City, too, fund managers are starting to favour companies with sound ethical – as well as business – credentials: hence the advent of the FTSE4Good Index (which includes nine construction firms). And then there's the staff. With skills shortages, what contractor can afford to be shunned by bright people simply because they can't stomach the idea of working for it? In these respects, the industry has been as slow to understand the true nature of the threat as it was when the road protesters took to the trees 10 years ago.

One can imagine Balfour's frustration over some of the outlandish claims made about the Ilisu Dam. But it has to take some responsibility for is portrayal as a bad guy. In future, firms must be able to make a coherent defence of their decisions on ethical and ecological grounds before they take the job. It's a boardroom priority. To be fair, Balfour and Amec have opened a dialogue with the environmentalists and publish audits of their projects. Which is the right way to go. Nobody will ever win the PR game against opponents who automatically have the moral high ground, but with a bit more openness, even contractors might walk away with an honourable draw.