Archive for the 'Accountable Corporate World' Category

Activists seek to turn raw energy of protest into change

People power may be making itself felt in protests all over the world, but away from the streets some traditional command structures are looking as resilient as ever. In the US presidential and legislative elections this week – one of the world’s largest exercises in democracy – the campaign spending totalled a staggering $6bn, said Ellen Miller, executive director of the Sunlight Foundation, a non-governmental group. That money – and the influence it bought – was lavished by donors accounting for just 0.1 per cent of the US population: in other words, one in a thousand US citizens drove the agenda of a process that would decide the political future of the country for the next four years.

The argument over the role of a moneyed few in the US poll is one of a host of debates over what some activists would call “legal corruption” –  the sway some individuals and institutions wield over society because of their wealth, disproportionate access to information, or some other advantage. As demonstrations over alleged social injustices rip through countries rich and poor, campaigners are asking how to parlay that anger into reform, rather than turmoil and instability.

“The energy is not going to go away,” said one activist, in remarks that referred to the Arab world revolts but apply almost anywhere. “The question is whether it’s going to be channelled into more social strife and ferment.”

Many of the great protests of the last two years – from Occupy Wall Street to the revolts sweeping the Arab world – have been triggered in part by disgust at real or perceived elite corruption. The Tunisian demonstrations that ousted President Zine el Abidine ben Ali followed WikiLeaks disclosures about alleged graft linked to the regime, while western protestors have condemned the bonuses paid to bankers after the financial crisis. 

Turning this feeling into reform is far from straightforward, however, as many popular movements that have since run into frustration are finding. Vested interests strike back against change, while the very instability and uncertainty created by protest movements can – somewhat paradoxically – create an environment where corruption flourishes, rather than retreats.

Misha Glenny, the author and journalist who specialises in organised crime, suggests a dark truth is that graft is an essential counterpart of profound socioeconomic shifts. He tells the story of an oligarch at the time of the collapse of the Soviet Union who claimed he and his fellow shady businessmen were the ones making logistics function during the crisis and thus ensuring Russians had “bread on the table”.

“Organised crime and corruption are absolutely vital to the process of transition,” Mr Glenny said. “The problem is when they lay down roots in the new state [because] the state is not able to keep pace with the speed of economic transition.”

One way to try to short-circuit that process is to try to bring more focus to popular pressure, moving it from a strong but vague desires for change to campaigns for specific – and thus achievable – action. Mr Glenny cites the example of the “ficha limpa” – clean record – law confirmed in Brazil this year, which brings in tougher curbs to prevent convicted criminals standing for public office.

Activists are also increasingly seeking the help of powerful groups who might not seem natural allies – such as companies who share an interest in seeing specific reforms happen.  John Sullivan, executive director of the Centre for International Private Enterprise, a not-for-profit group focused on private sector governance, said there was now a coalition of 22,000 businesses giving each other mutual support on avoiding extortion in Russia – the companies don’t want to pay bribes, just as concerned citizens don’t want to see them do it.

It’s clear that – whatever the nature of the graft they are targeting – many campaigners are increasingly concluding they can’t achieve what they want on their own. 

“Civil society is under a hell of a lot of pressure. We are not winning that fight,” said Jeremy Hobbs, executive director of Oxfam International, the anti-poverty campaign group, which has allied with lawyers in post-revolutionary Egypt working for civil rights. “We need corporate leadership to help. Because I don’t think civil society can do it without real muscle from business leaders who are prepared to set the bar very high.”


Michael Peel is a Financial Times journalist. He writes here in a personal capacity. 

The Next Step: Dirty Money

Throughout the International Anti-Corruption Conference, we’ll post exclusive interviews about what happens after the workshops and panels are over. We’ll look at what was accomplished and what strategies participants can actually take back to their countries to fight corruption.

One of the major obstacles to fighting corruption is dirty money and illicit financial flows. How do institutions restore people’s trust? And what key measures are needed to make sure transparency is rooted in the world of money.

After their panel, Patrick Alley, co-founder of Global Witness and Nicholas Shaxon, investigative journalist and author, joined me to talk about the next steps needed to curtail the flow of dirty money.

How Africa is Funding Development in the West

GFI Director Raymond Baker: "It's not a problem that can be solved entirely in Africa.


By the end of today, an average of $600 million worth of illicit funds would have left the African continent. Thats nearly $22 billion annually, and more than $850 billion in just under four decades.

The figures are based on a study by Global Financial Integrity (GFI), who  calculated the illegal transfers out of Africa between 1970 – 2008 using the World Bank Residual Method and the IMF Direction of Trade Statistics economic models. GFI Director Raymond Baker admits the figures can never be fully accurate due to the nature of the transactions and certain limitations. “All of this is gov provided statistical informational that doesn’t include other major components such as smuggling.” This means the figures are likely to be conservative and doesn’t represent the full extent of illicit money flows from the continent.

Out of the total 39-year period, the report claims the majority of illicit outflow originates from West and North Africa. The biggest offenders:

  • Nigeria – more than $89 billion
  • Egypt – more than $70 billion
  • Algeria – more than $25 billion
  • Morocco – $25 billion
  • South Africa – close to $25 billion

A Kenyan president at the ICC? Let the people decide.

It is indeed right that the sovereignty of a country rests with the people. It is they who must chose the leaders they want, and must not complain when such leaders do not perform or turn out to be incompetent. Rather, they must apply the same criteria, wait for the next elections to come and then chose other leaders.

But does the electorate especially in the developing world have the capacity to choose wisely? The wisdom if often clouded so by poverty,  ethnicity and propaganda that at the end of the day, the people are made to recycle the same politicians over and over again, while everyday complaining of corruption, ineptitude and  poor management.

> Read full story

The Profitability of Not Being Corrupt

This article is written by Transparency International’s Regional Director for Americas Alejandro Salas and was published on Fox News Latino on 2 March 2012. 

From a strictly rational point of view, a person decides to get involved in corruption for personal advantage, usually financial profit. The less likely it is that the corrupt act will be discovered and sanctioned — and the greater the potential profit — the more likely it is that corruption flourishes.

This economic perspective perceives corruption as a cost-benefit analysis. It partially helps us understand why, for example, bribing police officers is much more common in Mexico, where impunity is high and institutional controls are weak, than in Norway.

With that in mind, taking the moral route and refusing to resort to corrupt acts might be seen as irrational behavior. Why should I play by the rules if everyone else is cheating? But there are financial incentives for honesty and fighting corruption.
> Read full story

Page 1 of 3123»