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Anti-Corruption Initiatives

Building trust in the government one text at a time

Jana Kunicova's picture
English translation of the text message.
English translation of the text message that the government sends to citizens to in an attempt to prevent corruption.

Albanian citizens who recently received treatment at a state-run hospital are likely to receive a text message that reads something like this: “Hi, I am Bledi Cuci, Minister of State responsible for anti-corruption. Our records indicate that you recently received care in a state hospital.

Could you kindly tell me if you were asked to pay a bribe? Reply is free. Thank you for your time.


The SMS campaign, supported by The World Bank and implemented by the Ministry of State for Local Issues and Anti-Corruption, was launched on March 9, 2015.

As of early June, it has reached more than 33,500 citizens in a country of three million. About 20 percent have responded, reporting many service delivery problems.

The doctors are always late and the corruption continues as always. Without giving away money, no one takes care of you,” read one response. Others complain of lack of cleanliness or the absence of medicines: “No, they didn't ask for bribe, but we had to buy the drugs outside of the hospital because they didn't have any.” 

Halting the 'race to the bottom’ in corporate conduct: Governance reform, focus on ethics must repair the damage

Christopher Colford's picture

When terms like “criminal conspiracy” and “felony” appear in confessions and plea bargains, the criminal-justice system sits up and takes notice. And when the confessed felons are some of the world’s largest corporations, the private sector ought to be jolted into action, too.

The continuing shame of confessed corporate misconduct – in this case, lawbreaking conducted with such a degree of guile that the U.S. Attorney General called it “breathtaking flagrancy” and that the FBI labeled it criminality “on a massive scale” – reached a new intensity this month: Four of the world’s largest banks confessed to taking part in a five-year-long conspiracy to manipulate the world’s foreign-exchange markets.

This latest in a series of stern legal judgments has damaged the corporate reputations of some of the world’s most pivotal financial institutions – with guilty pleas, to felony charges no less, entered by Citicorp, JPMorgan Chase & Co., Barclays PLC and The Royal Bank of Scotland PLC. A separate guilty plea by UBS – along with earlier fines against Bank of America and HSBC in separate settlements in related cases – has brought the total of fines against those once-trusted, now-tarnished firms to about $6 billion.

The corporate confessions of deliberate lawbreaking, pursued with systematic and sinister stealth – at the very center of the international financial system – vividly validate the recent exhortation of Christine Lagarde of the International Monetary Fund: that corporate governance must be strengthened and that a higher standard of individual ethics must prevail, especially in the financial sector.

Lagarde wisely linked skewed incentives and a short-term profit-maximization mindset to the risk of financial instability, in an eloquent recent address to the Institute for New Economic Thinking’s conference on “Finance and Society”: “There is still work to be done to address distorted incentives in the financial system. Indeed, actions that precipitated the [global financial] crisis were – mostly – not so much fraudulent as driven by short-term profit motivation. This suggests to me that we need to build a financial system that is both more ethical and oriented more to the needs of the real economy – a financial system that serves society, and not the other way round.”

Those who champion the creative potential of the private sector (including, I imagine, the regular readers of this blog) have a particular reason – one might even say, a special responsibility – to voice their anger about the foreign-exchange-rigging scandal and other acts of lawlessness.

Idealists who esteem the private sector’s ingenuity in delivering growth and jobs sans frontières know that business' creativity will be indispensable in achieving the vital development goals of eliminating extreme poverty and promoting shared prosperity. Society thus rightly expects that the full measure of corporate energies should be focused on companies’ central mission of generating wealth that benefits all of society. Whenever any of those energies are diverted – especially toward criminal schemes that put short-term personal plunder ahead of long-term economic growth – the lawbreakers undermine public confidence (or what little remains of it, in the wake of the global financial crisis) in the fairness of the economic system.

Moreover, lawbreakers provide ammunition to critics who allege that today’s economic system is irredeemably corrupt, through-and-through – thus making it even more difficult for law-abiding companies, holding true to the values of honest business behavior, to make the case for policies that liberate private-sector dynamism.

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.



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.

Weekly Wire: the Global Forum

Kalliope Kokolis's picture

These are some of the views and reports relevant to our readers that caught our attention this week.

One
The Promising Game-Changers in Global Development: Social Innovators

“Turning on a light, warming a house, and using an appliance are activities that most of us take for granted. But in many parts of the developing world, access to electricity is scarce. Enter “sOccket,” a soccer ball that harnesses the kinetic energy of play to generate electricity. When kicked, it creates energy that can be stored and then used later to charge a battery, sterilize water or light a room.

SOccket has received a lot of attention recently – from the likes of Aneesh Chopra, the first White House chief technology officer, to former President Bill Clinton, who called sOccket “quite extraordinary.” The attention isn’t surprising – the invention is clever, it’s creative, it’s relatively cheap, and it takes on one of the biggest challenges in the developing world.”  READ MORE

French Civil Society Celebrates Legal Victory

Sabina Panth's picture


Last week, civil society in France celebrated a legal victory in its fight against corruption.  The French Supreme Court upheld judicial investigation on complaints lodged by civil society organizations (Transparency International France and SHERPA) against three African Presidents and their relatives (Denis Sassou-Nguesso of the Republic of the Congo; Teodoro Obiang of Equatorial Guinea; and Omar Bongo of Gabon) on their acquisition of property and luxury goods in France that are worth far more than their official earnings.