Last month I attended the Partnership Against Corruption Initiative (PACI) in New York. PACI is an initiative of the World Economic Forum that engages both the private and public sectors in fighting against corruption globally.
Corruption, of course, is not new. In the book of Job we find this quote about bribes:
“They conceive trouble and give birth to evil.”
Corruption, including bribery, is a humongous problem today. It is estimated that more than $1 trillion dollars is lost each year by corruption. In other words, more than one trillion dollars goes in the pockets of people who are not entitled to it. It is a major obstacle to social and economic development. One can imagine what a trillion dollars a year could do to eradicate world hunger, improve health worldwide and develop universal education.
Corruption is illegal in most, if not in all countries. The problem is that the existing laws are simply not enforced. It has been considered by too many and for too long as just “the cost of doing business” and as unavoidable obstacles that are too ingrained in local culture.
In the United States, the Foreign Corruption Practice Act (FCPA) imposes severe penalties to U.S. companies that have engaged in corruption abroad. The FCPA prosecuted more cases in 2010 than ever before. Assistant Attorney General Lanny Breuer recently said: “The Department’s enforcement of the FCPA is aggressive and on the rise. In 2005 we’ve collected (in fines and penalties) $16.5 millions, this year alone, we’ve collected well over $1 billion dollars already. In all, our message to companies and individuals who would bribe foreign officials is clear: Foreign bribery is not an acceptable is way of doing business, and we won’t tolerate it.”
The United Kingdom just passed the “Bribery Bill” who in many respects is even more severe than the FCPA. In the Bribery Act, no “facility payments” are allowed, the maximum imprisonment is 10 years as opposed to 5 years that FCPA can impose and there are no limits to the amount of fines. Furthermore the jurisdiction is broader. Any foreign company that has an office in the UK and is guilty of bribery anywhere in the world can be prosecuted in the UK. Let’s suppose that an employee of a U.S company who has an office in London bribes an official in Africa. He or she will be prosecuted by both the FCPA and the Bribery Act and will have to serve both sentences and pay fines in both countries.
Corruption is also a Human Rights issue. Studies have showed that Human Rights are much more likely to be protected in an environment that has little or no corruption. According to The International Council on Human Rights Policy, “Corruption is increasingly recognized as a major obstacle to the realization of human rights around the world.”
There is also a close link between terrorism and corruption. According to the report Links Between Terrorism and Other Forms of Crime by Yvon Dandurand and Vivienne Chin of the International Center for Criminal Law Reform and Criminal Justice Policy, in Vancouver Canada, terrorists, in order to support themselves and their causes most often engage in other form of criminal activity such as money laundering, bribery and extortion. Mark Mendelsohn, the former head of the Justice Department’s FCPA team says that many people in the government see a clear connection between illicit money and terrorism.
The good news is that things are changing. There is a major shift in the attitude of both governments and the private sector towards a “zero tolerance” position in regards to corruption.
The private sector is now more and more aware that the practice of bribery and corruption can be stopped particularly when companies in a concerted and collective effort categorically refuse to participate in corruption and bribery.
I just read a very inspiring story of a gentleman, Vijay Anand from India who developed the concept of a “Zero Rupee Note” to be given to government officials when they request a bribe. The Note is based on the 50 Rupee note. What is truly amazing is that the tactic works. Government officials, when presented with the note, more often than not, withdraw their request for the bribe and deliver the service requested. On the Note it is written: “I promise to neither accept nor give a bribe.” More than one million have been printed and the NGO Vijay created, (the 5th Pillars) a volunteer grass root organization has 14,000 members. In 2008 in created www.ZeroCurrency.org which provides anti-corruption notes in the currencies of 196 UN-recognized nations.
Corruption is global problem and therefore everybody’s business. We are all affected by it whether directly or indirectly. We are concerned (or should be) about terrorism, poverty, and human rights. Corruption has “a bad name,” it is up to us to make it even more shameful.
As Bess Myerson once said:
“The accomplice to the crime of corruption is frequently our own indifference.”"