Fighting corruption

Two views

Corruption is considered a global epidemic that costs the economy more than $1 trillion annually, according to estimates by the World Bank Institute. In recent years, the public and private sectors around the globe have begun working together to change that situation, attempting to level the playing field for citizens, nations, and businesses. Following is an overview of their efforts.

“Corruption is recognized to be one of the world’s greatest challenges. It is a major hindrance to sustainable development, with a disproportionate impact on poor communities and is corrosive on the very fabric of society.”
UN Global Compact
     

Public sector

 

Private sector

 
"The impact on the private sector is also considerable—[corruption] impedes economic growth, distorts competition and represents serious legal and reputational risks.”
UN Global Compact
 
 
  Impacts of corruption  
  • Undermines social, economic, and environmental development
  • Deters foreign direct investment
  • Contributes to lower quality and higher costs of goods and services
 
  • Creates unfair competitive environment
  • Limits business opportunities
  • Increases risks and costs of doing business in certain markets
 

Guiding frameworks to combat corruption  
  • OECD Anti-Bribery Convention
  • United Nations Convention against Corruption
 
 
  • UN Global Compact
  • Transparency International’s Business Principles for Countering Bribery
 

Actions taken to reduce corruption  
  • Criminalizing acts of corruption
  • Collaborating with other governments to prevent transnational corruption
  • Creating anticorruption bodies, such as a supreme audit board or specialized enforcement agencies
  • Creating effective legal systems for seizing, freezing, and confiscating the assets or proceeds of a crime
  • Developing transparency in government operations and public procurement and establishing enforceable codes of conduct for government officials
 
  • Issuing clear company policies on what constitutes unacceptable behavior and enforcing the prescribed consequences
  • Thoroughly and regularly training employees to address the enforcement of international anticorruption standards
  • Routinely conducting due diligence on third parties, such as agents, sales consultants, distributors, and vendors
  • Performing due diligence on business partners, personnel, and contracts
  • Performing frequent field tests to determine whether employees understand company policies and testing the adequacy of existing programs and controls
  • Streamlining and integrating payment systems to easily see where, why, and how much money is being spent
  • Regularly testing payment systems and controls to ensure all expenditures are accounted for

Benefits derived from an anticorruption focus  
  • Contributions to economic and social development
  • Signals of real commitment to citizens and the international community
  • Creation of a more level playing field for businesses evaluating opportunities in the market
 
  • Protection—and enhancement—of reputation and brand value
  • Mitigation of risk in new market activity, vendor relationships, and procurement efforts
  • Operating within anticorruption and antibribery laws and regulations
  • Safeguarding of assets, revenues, and investments
  • Improvement of operational efficiency and lowering of costs
  • Minimizing of sanctions and operational impact should an incident occur
  • Increase in competitive advantage with those organizations, governments, and consumers that want to do business with companies of the highest integrity