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Corruption encounters new sound & fury from all quarters
By Naresh Minocha
Aug 28, 2017

Naresh Minocha, a veteran journalist, specializes in telecom, energy, chemicals, agriculture, economic reforms and governance. In his over 32-years journalistic career, he has worked in different capacities for both Indian and foreign media organizations. These include Financial Express, Indian Express, Business Standard, Business India, Tehelka, the Pioneer, erstwhile Asian Chemical News, International Chemical Information Service and erstwhile

His current professional engagements include Consulting Editor, and Associate Editor, Gfiles Magazine. At, he has been writing a popular Column known as 'The Ice Cubes' since 2005.

THE more the merrier. Yes, the idiom 'too many cooks spoil the broth' is invalid in the global battle against corruption. One can infer this after scanning a slew of new initiatives against bribery being cooked at multilateral, regional, bilateral and at national levels.

The rationale for stakeholders upping the global ante against corruption is the fact that bribes are like mosquitoes that resist all controls. They react by acting as vector of new diseases in addition to malaria.

As put by the World Bank in its recent Brief on Corruption, "Businesses and individuals pay an estimated $1.5 trillion in bribes each year. This is about 2% of global GDP-and 10 times the value of overseas development assistance. The harm that corruption causes to development is, in fact, a multiple of the estimated volume, given the negative impact of corruption on the poor and on economic growth".

It adds: "Data on international financial flows shows that money is moving from poor to wealthy countries in ways that fundamentally undermine development. Corruption is a global problem that requires global solutions".

All stakeholders agree that new steps are needed to rein in corruption. No one is, however, sure about the precise efficacy of existing measures. Bribery can be checked substantially if all countries embrace global treaties and implement them sincerely.

International Monetary Fund (IMF) agrees: "While it is difficult to know what impact the various initiatives are having, their very existence, breadth, and variety demonstrate the importance that the international community attaches to promoting good governance and tackling corruption."

IMF has stated this in its exhaustive background notes issued along with its Policy Paper (PP) on Governance Issues on 2nd August 2017. PP is based on review of its role in governance issues concerning member countries.

It has decided to prepare a staff note to suggest strategies to plug gaps in four areas in its existing anti-corruption, good governance approach.

IMF thus intends to develop an improved method of assessing the extent of corruption in a country and its macroeconomic impact. Second, it will frame a "more concrete and granular policy advice to help governments tackle corruption ".

Third, it would address the sensitive issue of stating forthrightly the scale and cost of corruption to its member countries where this malaise undermines macroeconomic performance. Fourth, IMF would take steps to ensure "evenhanded treatment of corruption issues across countries " in its documents.

G20's Anti-Corruption Working Group (ACWG) is not lagging behind in conceiving &launching new steps to fight corruption, which is as hardy as cockroach that is considered as likely survivor of nuclear explosion.

"Corruption destroys public trust, undermines the rule of law, skews competition, impedes cross-border investment and trade, and distorts resource allocation. It is a severe impediment to sustainable and inclusive economic growth, and remains a significant challenge for developed, emerging and developing countries", says ACWG in its Interim Report 2017 released earlier this month.

ACWG will highlight steps taken by individual G20 States in its full Accountability Report. It will be first presented to a meeting of Sherpas (experts from its each member country)for their endorsement by end-2017.

ACWG's two recent initiatives are: 1) Release of 'G20 guide 2017 on Requesting International Cooperation in Civil and Administrative Proceedings Relating to Corruption'. 2)Adoption of the Compendium of Good Practices on the Use of Open Data for Anti-corruption prepared by Mexico and The Organisation for Economic Cooperation and Development (OECD).

As for the G20 Guide, ACWG notes that countries tackle corruption through three forms of legal liability: criminal, civil and administrative. Even though a majority of countries have historically chosen to establish criminal liability for corruption, civil and administrative liability regimes may also be an efficient way of holding individuals and legal persons liable for corruption.

According to the Guide, "when conducting civil and administrative proceedings to combat corruption, public officials often face circumstances in which they need international cooperation, e.g. to locate persons, serve documents, take evidence abroad or identify, trace, freeze and recover proceeds of corruption or property acquired through corrupt practices".

Fifteen countries, viz., Argentina, Brazil, China, France, Germany, India, Italy, Japan, Korea, Mexico, the Russian Federation, Spain, Turkey, the United Kingdom and the United States provide for such cooperation. Australia, Canada and Indonesia, on the other hand don't provide for civil and administrative proceedings to combat corruption. Hence, they cannot provide assistance to foreign authorities in civil or administrative anti-bribery cases.

India did not provide to ACWG the information on steps to be followed when seeking non-criminal cooperation. The former also didn't name the Contact information of the Central Authority.

Through identification of such missing links, ACWG is trying to strengthen anti-corruption drive within G20. It, for instance, continues to urge Japan to become a States Party to the United Nations Convention against Corruption (UNCAC). It has also appealed to all G20 members to effectively implement UNCAC.

Similarly, "ACWG continues to encourage India and Indonesia to criminalize foreign bribery" as required by UNCAC.ACWG is also pleading China, India, Indonesia and Saudi Arabia to become parties to the OECD Anti-Bribery Convention and participate in OECD Working Group on Bribery.

The delays and foot-dragging by certain G20 countries raises a fundamental issue: Should multilateral institutions agree on accountability of member countries for non-compliance? To begin with, all global sponsors of anti-bribery treaties should issue consolidated, tabulated list of Non-compliant nations, mentioning period & reasons for delay in non-compliance.

They should also make public disclosure of peer review reports of compliance with clauses of treaty mandatory. Let the public know anti-corruption deficit at the global level.

Multilateral institutions should reach a specific agreement, binding each country to present to its Parliament an annual report on extent of compliance with international & regional anti-corruption treaties and with national enactments.

Coming back to new initiatives from such institutions, World Bank group (WBG) has re-galvanized itself to focus on corruption as core development issue following London Anti-Corruption Summit held last year.

WBG says it has decided to build the capacity of country clients to deliver on their commitments to enhance transparency and reduce corruption. It will also enhance its support for implementation of anti-money laundering requirements and for the recovery of stolen assets. It will expand its work on tax reform, illicit financial flows (IFFs), procurement reform, and preventing corrupt companies from winning state contracts.

WBG has included "Governance and Institutions as a theme" in International Development Association (IDA)-18, the latest soft loan window that would finance projects in developing countries over three years beginning 1 July 2017.

OECD is another major institution that is always dishing out something new on anti-corruption front. It recently released Budget Transparency Toolkit that has been developed in association with the Global Initiative for Fiscal Transparency (GIFT) Network.

This Document says, "The Toolkit does not aim to repeat or replace any of the materials that are already available from these bodies: it simply aims to serve as a guide or signpost to these materials, while also reinforcing some key practical messages about budget and fiscal transparency ".

It provides practical steps for supporting openness, integrity and accountability in public financial management.

A young but robust institution that has corruption on its radar is The Open Government Partnership (OPG). Launched in September 2011, OPG's strength has grown from eight founding governments to 75 countries and 15 subnational governments at present. They have made over 2,500 commitments to make their governments more open and accountable.

According to Transparency International's paper titled 'Anticorruption Commitments in the Open Government Partnership' released last year, when governments sign up to OGP, they adopt the Open Government Declaration, which includes the commitment to have "robust anticorruption policies, mechanisms and practices, ensuring transparency in the management of public finances and government purchasing, and strengthening the rule of law" .

A commitment that deserves mention is Ireland’s resolve to Ireland has committed to introducing a ‘legislative footprint’ in relation to 18 current legislative initiatives, to be published on each Department’s website.

The legislative footprint allows stakeholders to track and monitor well the real level of influence of lobbyists on the decisions that are taken by elected representatives.

With so much effervescence in anti-bribery broth, some multilateral institution should create footprint portal on all initiatives taken under different treaties and commitments. The footprint website should identify overlapping initiatives. It should assess the deficiency in implementation of each step.

The need for such website becomes clear if we recall World Bank report 'The Many Faces of Corruption' released in 2007.

It says: "Corruption is very much like a cancer. It manifests itself in a multitude of ways, continuously morphing into new shapes. But just like the proverbial medical researcher laboring every day in the laboratory until the early hours of the morning, social scientists and practitioners continue to search for new ways to address and contain this disease".

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