Syndicate content

Corporate responsibility

Weekly wire: The global forum

Darejani Markozashvili's picture
These are some of the views and reports relevant to our readers that caught our attention this week.
 

Global Internet Report 2016
Internet Society
Today we are at a defining moment in the evolution and growth of the Internet. Large-scale data breaches, uncertainties about the use of our data, cybercrime, surveillance and other online threats are eroding users’ trust and affecting how they use the Internet.  Eroding trust is also affecting the way governments view the Internet, and, is shaping the policy environment for the Internet around the world. The 2016 Global Internet Report takes a close look at data breaches through an economic lens and provides five clear recommendations for a path forward.

What Does “Governance” Mean?
Governance Journal
The normative goals of governance reform are twofold: more effective public policies, and procedures that are legitimate and accountable to the citizenry. Often the phrase “good governance” is intertwined with the anticorruption agenda. Drawing on the author's experience as a visiting researcher at the World Bank and as a scholar of both corruption and comparative politics, this essay unpacks the concept of governance and relates it to debates over ways to balance technical expertise and public participation to achieve better functioning governments.

The science behind collective lying: How and why employees cheat

Roxanne Bauer's picture

It’s well understood that everyone has the capacity to be dishonest and almost everyone cheats— even if it’s just a little. Sometimes we fill our water cups with soda, we take the pens from the credit union, or we may speed when we’re running late. But what is going on when institutional deception, involving multiple people, occurs?

As most of us are now aware, Wells Fargo recently received a $100 million penalty from the Consumer Financial Bureau of the United States after it was uncovered that its employees were engaging in illegal banking practices. This brought the bank's total bill for these infractions to $185 million and coincided with the firings of about 5,300 Wells Fargo employees. According to reports, the 5,300 employees who were allegedly involved secretly issued credit cards that customers never requested, set up fake bank accounts that resulted in customer fees, created fraudulent email accounts to sign up customers for additional services, and actually transferred customers' money between accounts— without permission.
 
Such an outrage might remind you of the Volkswagen scandal last year in which the German car manufacturer admitted that it had used sophisticated software to trick emissions regulators. If a car was being tested, the emissions controls would operate as they should, but if the car was not undergoing a test, the emissions controls would switch off, resulting in cars that emitted 40 times the legally sanctioned levels of air pollutants.  Volkswagen has since has admitted that 11 million vehicles worldwide were equipped with the program that duped emission testing and had to recall a total of 8.5 million diesel vehicles in Europe alone.
 
How in the world did that many people get involved with such unscrupulous behavior? How could over 5,000 Wells Fargo employees engage in such obviously deceptive and fraudulent behavior? And how could so many Volkswagen employees, from software technicians to senior management, go along with blatantly circumventing the rules? How does a group of people end up lying together?

Macro hype, micro hope: Optimists champion ‘Community-Led Development’

Christopher Colford's picture

Now there’s a guy who really puts the full-scale dismal into “the dismal science” of economics – spurring optimists to quickly seek out more hopeful visions of the future.

Those seeking a glimmer of hope about the economic future were well-advised to keep their expectations low as they awaited the gloomy analysis by Prof. Robert J. Gordon, the esteemed economic historian from Northwestern University, who spoke at the World Bank Group’s Macrofiscal Seminar Series on March 31. As anticipated, Gordon’s expertly documented but relentlessly downbeat scenario, based on his latest book, “The Rise and Fall of American Growth,” persuasively made the case for a future of chronically sluggish growth in the world’s advanced economies.

Gordon’s chilling projections combine some of the darkest aspects of Lawrence Summers’ worries about “secular stagnation,” Christine Lagarde’s lamentations of a “New Mediocre” and private-sector leaders’ struggle to strategize for the “New Normal.” Gordon’s bleak thesis foresees “little growth” – although, significantly, not zero growth – as the developed world’s weary economies endure perhaps decades of drift.

Policymakers in the world’s largest economies are surely exasperated by the painstaking crawl out of the global financial crisis – yet they don’t have much positive news to look forward to, asserts Gordon. With “declining potential productivity growth” compounding the impact of declining population growth and a declining labor-force participation rate, there’s probably no technological deus ex machina that can soon propel the world’s advanced economies toward restored prosperity.

That viewpoint defies the techno-utopian visions that have been so eagerly peddled to anxious Western voters, who can only dream of a return to brisk late-1990s-style growth. Quipped the Macrofiscal seminar’s discussant, Deepak Mishra: Gordon “has made a career of busting the technology hype.”

Yet Gordon’s logic need not trigger total despair among the Bank’s poverty-fighting professionals and their counterparts at other development institutions. Gordon emphasized that his analysis is about the American economy, and, to some extent, about the mature economies of Western Europe. His book’s foreboding predictions, he said, do not extend to developing economies, which enjoy “great potential for growth.”

For can-do pragmatists who strive for stronger growth and sustained progress in developing economies, there’s a ready antidote to Gordon-style macroeconomic gloom. By happenstance, immediately after Gordon delivered his grim analysis in the Bank’s J Building auditorium, optimists seeking inspiration needed only to cross the street to the Bank’s Main Complex to hear an energetic appeal for greater hands-on activism.

With an update on the movement for Community-Led Development (CLD), a seminar sponsored by the Bank’s Community-Driven Development Global Solutions Group learned of the promise that CLD offers for inspiring inclusive, sustainable solutions that enlist citizens’ engagement and build community-level confidence in strong governance standards.

Moving from macro to micro – dispelling the dread of inexorable global forces and embracing positive citizen-centric action – the CLD leaders leapfrogged Gordon’s macro-level angst to highlight micro-level opportunity.


From Deals to Development: A snapshot from Monrovia

Michael Jarvis's picture

Once a concession agreement or any large-scale public procurement contract is signed, who can ensure that the terms are met? How to turn commitments into development on the ground? This is the puzzle that a mix of around 70 government, business and civil society leaders from West Africa began to solve this past week.

It’s Our Money

Sabina Panth's picture

It has been argued that corruption cases are focused mostly on the offenders and retribution is calculated on material value. This leaves out the victims of corruption and the collective damage done to the society at large, especially when the malfeasance involves the misappropriation of public money.  The concept of ‘social damage’ is an emerging concept in the anti-corruption movement, which seeks to identify, quantify, and repair the impact and consequences of corruption on ordinary citizens.  It posits that citizens, as taxpayers, are entitled to a legal claim on public money and how it is spent because “every dollar lost in corruption is a dollar stolen from spending in education, social services, poverty reduction and job creation (Its Our Money)”.

Inclusive is the new black

Michael Jarvis's picture

One hears less about the base of the pyramid these days. Instead, "inclusive" remains the clear buzzword of choice for now. The recent UN Millennium Development Goals Summit generated a side workshop on Inclusive Business organized by a roll call of organizations. Now IFC is hosting its own event on Inclusive Business Solutions around the IMF/World Bank Annual Meetings this week. The term is pervasive.

A collective need to rebuild public trust

Michael Jarvis's picture

The global economic crisis revealed large scale fraud in the financial sector (witness the Madoff scandal, among others). Unsurprisingly, it  has prompted widespread decline in public trust in companies. The Financial Times / Harris Poll released last month suggests three-quarters of people in the US and Europe now have a worse opinion of business.

CSR++ for agribusiness

Michael Jarvis's picture

Participants from the length of the agribusiness value chain are gathered at the Bank this week for the World Bank Institute’s new Executive Program on Inclusive Agribusiness: Fighting Poverty, Hunger and Malnutrition. Chris Delgado and John Lamb from the Bank’s Agriculture and Rural Development team set the scene on Tuesday morning by laying out the scale and complexity of the challenge facing the food sector. It was not a pretty picture.


Pages