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Anti-Corruption Day

Anti-corruption: Tunisia tops transparency in military spending but still “high risk” of corruption in defense

Christine Petré's picture
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Defense budgets are not publicly available, oversight is weak, and information about hidden spending is non-existent, says Transparency International-UK (TI-UK) of defense spending by the 17 governments it has scrutinized in the Middle East and North Africa (MENA) as part of a new global report. 

Here are 10 ways to fight corruption

Robert Hunja's picture


1. Corruption is not only about bribes: People especially the poor get hurt when resources are wasted. That’s why it is so important to understand the different kinds of corruption to develop smart responses. 
 
2. Power of the people: Create pathways that give citizens relevant tools to engage and participate in their governments – identify priorities,  problems and find solutions.
 
3. Cut the red tape: Bring together formal and informal processes (this means working with the government as well as  non-governmental groups) to change behavior and monitor progress.

How corruption affects businesses around the world, in 5 charts

Ravi Kumar's picture


We know corruption in developing countries affects poor people the most. It also impacts firms in many ways.

Here are five charts showing how corruption is affecting businesses from South Asia to Sub-Saharan Africa.

Amid the rescue and recovery in Greece: Corruption-hunting – putting promises into practice

Christopher Colford's picture



After the drama,
 the dénouement. Crisis-watchers who were riveted to last week’s continuous flow of breaking-news bulletins from Brussels – as the European Union and Greece furiously negotiated (often through diplomatic feints and calculated disclosures to the press) a fragile accord on the latest stages of Greece’s debt crisis – are now awaiting the next high-intensity, high-anxiety step in the prolonged process: the scrutiny of the list of proposed reforms that Greece has agreed to submit to still-wary EU officials by Monday.

Whether this week’s list of proposed reforms, being drawn up by Finance Minister Yanis Varoufakis, proves to be enough to satisfy the skeptics in the Eurogroup is the next question for Eurozone-focused analysts. Continued haggling over the details seems likely over the next week – and, ominously, the remainder of calendar for 2015 looks unforgiving. Even if an accord can be solidified this week, many observers dread that anxieties will be inflamed again within four months, when the EU’s brief extension of its financial rescue package for Greece will have run its course – just at the moment when Greece will be facing a midsummer deadline for paying large installements of its vast international debts. Another bout of brinkmanship this summer may revive fears of a possible disorderly exit from the Eurozone. With the fragile Greek banking system vulnerable to potential runs by depositors, the situation will surely command the attention of financial-sector crisis managers for months to come.

Throughout the white-knuckle phase of this Greek tragedy, the Bretton Woods institutions have had a constructive role to play in trying to resolve various aspects of the crisis. The International Monetary Fund has been a central pillar of the rescue operation, joining the European Central Bank and the European Union as part of the so-called “troika” (or, as it is now phrased more mildly in EU parlance, “the institutions”) serving as the rescue overseers. The World Bank Group has been involved in the situation, as well – although in a less-visible role that involves Greece’s long-term recovery rather than its short-term rescue. By providing, not financing, but technical expertise to Greece, the Bank Group has been helping strengthen the country’s investment climate – an area where, according to recent editions of the “Doing Business” report, Greece has made some notable progress in recent years.

As the Eurogroup and Greece this week consider Varoufakis' list of proposed policy reforms, one important concern is certain to be on everyone’s agenda: enforcing stronger steps to fight corruption and ensure good governance. In an anticorruption cri de coeur last week, an Op-Ed commentary in the New York Times by Gregory A. Maniatis explained, and deplored, how that beleaguered country’s chronic “corruption by elites siphoned off countless billions” that should instead have been used for pro-growth investment.

“Practically every time Greece made a purchase — be it of medicines, highways or guns — a substantial cut went into the wrong hands,” wrote Maniatis, who is a senior fellow at the Open Society Foundation and the Migration Policy Institute and an adviser to the United Nations. “As a result, monopolies and oligopolies led by politically connected families choked competition and controlled much of the country’s banking, media, energy, construction and other industries.”

An estimated 20 billion euros (about $22.8 billion) are lost every year due to pervasive corruption in the Greek economy, he wrote – and such a coddled “kleptocracy set a tone of impunity that enabled lower-level graft” in a “cycle [that] became self-perpetuating, as oligarchs tightened their stranglehold over the political system.”

Noting that Transparency International ranked Greece “at the bottom among European Union members” in its Corruption Perceptions Index – “tied for last with Bulgaria, Italy and Romania” – Maniatis questioned why “graft prosecutions are rare” in Greece. Every act of corruption, after all, requires two-way complicity: “In order for someone to receive a bribe, someone else has to pay it,” he noted. Perhaps legal watchdogs, in both Athens and Brussels, have not been diligent in monitoring the behavior of major European companies that might be engaging in bribery.

Maniatis’ suspicion suggests that the troika's crisis-management program may have overlooked a corrosive threat to Eurozone stability: “Why wasn’t Brussels focused at least as much on corruption as it was on debt? If the European Union’s absence on this front was lamentable before the crisis, it was inexcusable afterward. Officials from the so-called troika essentially took up residence at the Greek Finance Ministry in 2010, but rarely visited the Ministry of Justice.”

Warning of the threat that corruption poses to sound development and shared prosperity in every economy, Maniatis’ essay brought to mind the recent World Bank Group-hosted forum by the International Corruption Hunters Alliance, with the theme of “Ending Impunity: Global Knowledge: Local Impact.” As many speakers at the ICHA forum in December 2014 pointed out – and as many countries that are struggling with eradicating corruption continue to find – a profound mindset-shift is needed to change an economy that tolerates a culture of corruption into an economy that demands a culture of compliance. By insisting on good governance standards, private-sector firms, no less than public-sector agencies, have the duty to enforce a “zero tolerance” policy for graft in every country where they conduct business.

Eradicating pervasive corruption from a long-graft-ridden economy may be a years-long challenge – if it can be achieved at all. So, while strict anticorruption measures are almost certain to appear on Varoufakis’ list of proposed policy reforms for Greece, enacting and enforcing them – and promoting a culture that recognizes corruption as Public Enemy Number One for development – seems likely to require near-permanent vigilance.

Those who wish Greece well in its long struggle to renew its economy – along with those who wish the European Union success in its half-century-long trajectory toward integration and stability – will surely applaud their forthcoming steps
toward promoting good governance and adopting stronger anticorruption safeguards. Along with all nations that seek to eradicate corruption, Greece and the EU can draw on the substantial body of knowledge developed by the International Corruption Hunters Alliance – an indispensable resource in the global quest for good governance that helps promote shared prosperity.



How Communication can Help Break the Chain of Corruption in the Private Sector

Roxanne Bauer's picture

When one thinks of corruption in the private-sector, grand scenes of executives paying bribes, bidders lying to win contracts, and senior accountants setting up secret bank accounts are likely to come to mind. In reality, though, the most common form of corruption is small-scale bribery involving people at every step of a company ladder. 

Small-scale bribery can take many forms, including non-disclosure of conflicts of interest, setting up deals that benefit particular people, or paying a little extra money to speed up a normally slow process. You might not think the everyday payments people make to building inspectors, customs officials, their friends across the street, or to themselves matter, but they can create a culture of corruption and set an expectation for future payments.

This was one of the main points of a panel discussion, “The Role of Integrity Compliance and Collective Action in Making the Private Sector a Partner in the Fight Against Corruption” at the International Corruption Hunters Alliance conference held at The World Bank Group December 8-10, 2014. The panelists were Dr. Andreas Pohlmann, Billy Jacobson, and Cecilia Müller Torbrand. Galina Mikhlin-Oliver of the Integrity Vice Presidency of The World Bank was the moderator.

Six Charts on How Corruption Impacts Firms Worldwide

Ravi Kumar's picture

At times, I ask my friends in Nepal, why they would not launch a business, especially when they have funds. A common obstacle for everyone is that they say you have to bribe government officials to even open a business.
 
Turns out, this isn’t unique to Nepal. According to Drivers of Corruption, a report recently published by the World Bank, developing countries are generally more affected by corruption than other countries.

Here are six charts that show firms’ experiences with corruption around the world. These charts are based on surveys of more than 13,000 firms in 135 countries, by World Bank Enterprise Surveys.

Check out these charts and tell us if you are surprised. 

Follow the Money: Corruption and Graft Punish the Poor, Undermine Development, and Corrode Honest Governance

Christopher Colford's picture



Follow the money, and you’ll find out how and why corruption has become "Public Enemy Number Onefor those who are promoting global development – as crony capitalists in the private sector connive with corrupt officials in the public sector to short-circuit sound business practices, reward self-interested insiders, subvert the broad public interest, and undermine the ideals of good governance.

This week’s gathering of the third-ever conference of the International Corruption Hunters Alliance (ICHA) – a global network of prosecutors, lawyers, detectives, forensic accountants and policymakers who track down illegal and unethical financial practices – will underscore the continuing drain on development imposed by public-sector graft, private-sector lawbreaking, and the worldwide flow of illicit funds from sinister financial transactions.

Monday morning’s opening plenary session at the World Bank Group’s headquarters in Washington – headlined by Prince William, the Duke of Cambridge and heir to the British throne, along with Bank Group President Jim Yong Kim – began a week that should help focus worldwide attention on the way that systematic corruption enriches lawbreakers, undermines respect for the rule of law, thwarts good-governance efforts and drains scarce resources from effective development.

The three-day conference should also raise public awareness of the vigorous international action that has been mobilized in recent years, as corruption-related concerns have risen to a leading position on the global diplomatic agenda.

Inspired by then-World Bank President James D. Wolfensohn’s landmark “cancer of corruption” speech at the 1996 Annual Meetings, global action has been steadily gaining momentum – through such channels as the G20 leaders’ working group to tighten policies and procedures; the Financial Action Task Force’s standard-setting vigilance; the OECD’s Anti-Bribery Convention and its continuing monitoring of corruption’s toll; and civil-society organizations’ diligent watchdog efforts to ensure that development dollars will go, not toward graft, but toward the places where aid is desperately needed.

This week’s events at the Bank Group – focusing on the theme of “Ending Impunity,” and pivoting around International Anti-Corruption Day, which the United Nations has designated as this Tuesday – are timed to coincide with the launch of the OECD’s latest Foreign Bribery Report

The World Bank Group continues to champion the anticorruption ideal and good-governance standards: by enforcing a “zero tolerance” policy for corruption, closely tracking furtive patterns of suspicious financial flows, and working with law-enforcement officials worldwide to track down assets that have been looted and hidden by kleptocratic regimes. This week’s conference is organized by the Integrity Vice Presidency – which coordinates the Bank Group-wide effort to expunge all corrupt or unethical practices – with the support of such Bank Group units as the Governance Global Practice and the Stolen Assets Recovery Initiative.

How Would You #TakeOn Corruption and Promote Good Governance?

Ravi Kumar's picture
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Corruption greatly undermines government effectiveness.
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On a hot dry day in June, a woman in her early 40s is getting ready for journey to a nearby town. She is excited even though she will walk more than three hours on foot—she is going to meet with a government loan officer to try to get the money she needs to buy fertilizer and other supplies for her farm. She needs to grow and sell enough crops to pay for her son to continue school for the next year.
 
She gets a mug of water from a bucket to put out the open wood fire that she uses to cook meals for her family. Then she pulls her slippers from the thatched roof and leaves her hut.
 
As she walks, she feels hopeful. She believes this loan will change her family’s future. For the past 6 months, she has made numerous trips to this office because the government official had told her that before her application could be considered, the paperwork must be accurate and complete.  

Where is the Money?

Sina Odugbemi's picture

Today is Anti-Corruption Day, and the day prompts this reflection on aspects of  the fight against corruption. I was at the  Conference of the States Parties to the United Nations Convention against Corruption, Doha, Qatar, November 9-13. It was an opportunity to witness the debates around anti-corruption efforts, attend seminars and meet experts, officials as well as activists. Here are the impressions/conclusions that I came away with: