Collective Action: A new approach to combat corruption (Part Five)
Monday, September 8, 2014 at 8:08AM
Brook Horowitz in China, Collective Action, Russia, UN Convention Against Corruption

As we saw last week, there's a perception that voluntary anti-corruption declarations are too weak to have any significant impact on preventing corruption. While it’s true that declarations have more of the “collective” than the “action,” they are still an important step in the fight against corruption, especially when combined with the awareness-raising activities which usually accompany them. 

First, it’s important for market players to establish some kind of common ground in the definition of the problem – indeed that corruption is the problem at all.

While most nations have signed up to the UN Convention against Corruption, that does not mean that these global governing principles have been consistently embodied into local law or are interpreted and enforced in the same way in every country. Initiatives such as UNGC or PACI, which translate the international principles of anti-corruption into practical guidance for business, have played an important role in creating common ground between companies from different jurisdictions.

Second, the concept of what is “corruption” is very much dependent on local business culture, laws, and traditions. Imposing an Anglo-American view of corruption is hardly going to get traction in China with its age-old tradition of greasing the palm (nowadays better known by the less evocative term “facilitation payments”) even with the current clamp-down on corruption. Participating in drafting an anti-corruption declaration or engaging in the forums, conferences and training which usually  go hand in hand with such initiatives enable companies to close the gaps between market players’ understanding of what is corruption, and raise awareness of the full array of possible solutions.

In IBLF’s experience in difficult markets such as Russia and China, awareness raising programmes have been indispensable to enable the business community to move towards the next stage of Collective Action. 

Over the last few years, we've been bringing together CEOs, senior legal counsels, chief audit officers, VPs of human resources, chief compliance officers and Board directors to exchange experience in how to make their companies and distribution chains impervious to corruption.

The experience of the companies is shared with a wider audience in business and government through publications and on-line resources. Take for example our business integrity guide in Chinese and English, with its glossary of anti-corruption terms in both languages. The debates on terminology these engendered between our contributing experts from the participating companies knew no end, and graphically illustrated the differences in understanding of corruption.

Another example of joint activities, this time in Russia, was our Business Ethics course -- the first set of training materials in the Russian language for business school students. The course, which features case studies contributed by multinationals and domestic companies from their own experience in the Russian market, is now being taught in 20 of the leading Russian business schools and faculties, and will be introduced to companies as a corporate training program this year.

These are just a few examples of the sort of work done by consortia of companies and NGOs all over the world to create a common understanding and a level playing field.

We are often asked what the value and impact is of such business-backed initiatives. After all, none of this, in itself, will eliminate or even visibly reduce corruption in societies where it is so deeply ingrained.

The aim is more modest, though no less critical. It is to provide a resource to inform the existing and future generations of local executives about international business standards and how they might be applied in the local context. In many countries exposed to high levels of corruption, such initiatives are helping to set the agenda, define the challenge, raise awareness and trust, and to create a network of corporate leaders willing to work together to bring a new way of doing business to their companies and markets.

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Brook Horowitz, pictured above, is CEO of IBLF Global, a not-for-profit promoting responsible business practices worldwide.

Article originally appeared on The FCPA Blog (https://www.fcpablog.com/).
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