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Spring cleaning

india Updated: Nov 18, 2011 00:40 IST
Highlight Story

From the massive demonstrations in India to the Occupy Wall Street movement and the Arab Spring, the call for greater transparency and accountability worldwide has never been louder.

The good news is that we are making progress. Over the past three years, a major sea change against corruption has swept the world. The Group of 20 (G20) nations has demonstrated strong leadership with the Seoul Anti-Corruption Action Plan. China, Russia, Turkey, Britain and others have all recently moved to strengthen their legal frameworks. The United Nations Global Compact has introduced a tenth principle against corruption. A growing number of businesses have established anti-corruption and compliance programmes. And pressure from ordinary citizens around the globe is mounting.

But we haven’t done enough. More than 50% of respondents to Transparency International’s 2010 Global Corruption Barometer survey say corruption has actually increased in their country over the past three years. According to the World Bank, graft adds an extra 10% to the cost of conducting business globally, and 25% to the cost of procurement contracts in developing countries, where fair wealth transfers are needed most urgently.

The Organisation of Economic Cooperation and Development (OECD) has repeatedly warned that there are wide disparities in enforcement activities among the countries that are party to the OECD Anti-Bribery Convention. More work is clearly needed to further support a global economy based on rules of common integrity and fair competition.

That’s why the G20 should reinforce the Seoul Anti-Corruption Action Plan with a new global anti-corruption partnership, which would bring together G20 governments, businesses and core organisations engaged in the fight against corruption, such as the OECD, the International Chamber of Commerce, the World Economic Forum and Transparency International.

The new partnership would secure fair competition and common integrity rules both across countries and between companies by creating an operational mechanism to develop practical, innovative solutions to support a clean business environment. It would also identify policy gaps and encourage companies worldwide to adhere to existing rules, principles and tools that help fight and report on corruption.

At the same time, the G20 should accelerate commitments to ratify, enforce and monitor the UN Convention Against Corruption and the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. This should include securing additional funding and operational support to ensure these conventions are more widely enforced. It should also include providing further financial and technical support to help developing countries prevent corruption.

Simultaneously, G20 should integrate anti-corruption measures as a core part of their bilateral and multilateral aid programmes.

To balance these anti-corruption measures, there is also an opportunity to offer positive incentives to companies, countries and high-level public officials who take the lead in the fight against corruption. For example, the G20 could create a ‘white list’ comprising companies with proven integrity programmes. To be eligible to join the list, companies would need to establish effective anti-corruption programmes, participate in collective action initiatives to help promote integrity and fair competition and meet other standard criteria.

Simultaneously, the G20 should establish a high-level reporting mechanism to help support companies that find themselves facing corrupt business practices.

Anti-corruption momentum is building around the world. The G20 should take bold, collective action to stamp out corruption and improve transparency and accountability worldwide. But it cannot act alone. Businesses, organisations and society also share an interest in eliminating corruption and as such should also play a key role in developing and implementing concrete solutions and action plans. With support from G20 leaders, there is a significant, collective opportunity to support the commonintegrity and rules of fair competition, which remain so vital to our global economy.

Robert Greenhill is managing director, chief business officer, World Economic Forum

The views expressed by the author are personal