Companies Discuss the Challenges of Corruption

Michael Pedersen is guest blogging for the Forum. He is Associate Director and Head of Partnering Against Corruption at the Forum and attended the World Economic Forum on Latin America in Rio.

At the end of last week, the World Economic Forum Partnering Against Corruption Initiative (PACI) convened its 15th biannual meeting in Rio de Janeiro, Brazil. The meeting brought together approximately 70 senior representatives from PACI signatory companies from across industries and regions to discuss corruption-related challenges and define evolving best practices.

Participants discussed the challenges of doing business in Brazil, enforcement of anti-corruption laws, and transparency in infrastructure projects related to the 2014 World Cup and 2016 Olympic Games. Other topics included corruption crisis management, business relationships due diligence, facilitation payments and the G20 anti-corruption action plan.

Bringing together leaders from business, government and civil society, the meeting proved to me, once again, the value of all players working together to enhance and support collective action. In a Brazilian context, I was especially impressed to learn about the ambitious anti-corruption laws currently going through Parliament, such as laws on public access to information, lobbying and bribes to public officials.

I also found it very encouraging and inspiring that an organization like Ethos Institute is working to ensure “Clean Games Inside and Outside the Stadium” for the 2014 World Cup and the 2016 Olympic Games. This projects aims at bringing together government at the federal, state and city levels, as well as civil society and industries including construction, transportation, energy and healthcare to ensure fair and transparent processes for large infrastructure projects.

Finally, the opportunity offered to start shaping the G20 business recommendations on anti-corruption was perhaps one of the most exciting parts of the meeting. With a G20 Business Task Force in place with prominent CEOs from across industries and regions in the G20, the World Economic Forum is well-positioned to facilitate strong recommendations to the G20 on how to best fight corruption through implementation of the G20 anti-corruption action plan.

Ideas developed included incentivizing more companies to become engaged in the fight against corruption; recognizing leadership through positive incentives like tax breaks, preferred supplier status in public bidding and eligibility for reduced sanctions in case of a corruption case; and providing incentives to companies to voluntarily disclose corruption cases.

There is indeed unprecedented momentum on the issue of corruption: PACI now boasts more than 160 signatory companies, with more on the way! Among other things, this reflects the implementation of the G20 anti-corruption action plan, the UK Bribery Act taking effect and the public uprisings against corruption in the Middle East and India.