Cristina Albertin, Regional UNODC Representative for South Asia Speaks on:

" Making a Business Case for the Ethical and Transparent Corporate Conduct "

29 June 2009: It is a great pleasure for me to be here at this workshop to address you, important repres entatives of the Indian corporate world on such a significant issue as ethics and transparency in the realm of corporate conduct. It is also a great pleasure to see so many of you here as your presence demonstrates your commitment as a sector, to take a serious note of the issue and to proactively search for solutions through collective deliberations in an open forum.

Corruption has a devastating effect on democratic governance and economic development allover the world. The problem is global and no country in the world could possibly claim to be immune against any of the various forms in which corruption manifests itself. Yet, it is of particular concern in the developing world, as huge amounts of money and resources are diverted through corruption away from what it should serve, socio-economic development, justice and security. And it is a particular concern to us here, as our Office in Dehli serves South Asia which is home to one fifth of the world population and where countries face enormous challenges of sustainably alleviating poverty of millions of people and of meeting the universally agreed upon Millenium Development Goals in less than six years from now.Not long ago, corporate leaders predominantly believed that they were victims of bribery and that they had practically no role to play in fighting corruption. Although corruption as such was almost unanimously considered as ethically unacceptable, few were able to visualize and understand its long term harmful consequences for business. It is perhaps, therefore, that scepticism with regard to the benefits of a zero tolerance approach, remained.

However, this is gradually changing. Companies now increasingly realise the need to proactively get involved in promoting ethics, transparency and anti-corruption. Many companies have in fact learnt from their own painful experiences that complicity in the bribery game renders them easily vulnerable to repeated illegal demands, can cause cost escalations and may compel them to commit economic offences, including fraud and forgery for the generation of unaccounted cash flows. At stake is the image of the company in the market and among employees and with that the economic survival of the company.

Even worse, as seen in the recent history, greed and unethical practices in some large, formerly well-reputed companies have caused economic collapses with tremendous impacts on the lives of employees, share-holders and the population at large.

What can be done collectively?

In 2003, the world community marked a historic milestone by adopting the United Nations Convention against Corruption, the first ever universal instrument against corruption. Two years later, it entered into force and today, we can report that 136 countries have ratified the Convention and with that made a commitment to comprehensively address corruption in their societies. Through this Convention, countries have now universally agreed upon and accepted comprehensive standards and measures to criminalize and prevent corruption in their respective countries as well as to implement appropriate measures for asset recovery and international cooperation. Whereas the Convention has been signed and ratified by Governments, it does not limit itself to entrusting measures for the public sphere. It also proposes concrete measures to be taken both by the private sector and civil society. For example, in Article 12, the Convention specifically mandates a code of conduct for the prevention of conflicts of interest, internal auditing controls and transparency among private entities, as well as proper commercial practices. The Convention also deals with the issues of bribery and embezzlement in the private sector and proper provisions to penalise such acts, specifically in Art 21 and 22.

Through the UN Global Compact, the corporate sector across the world has signed up and committed to ten principles of the work of the United Nations, such as the principles of Human Rights, Labour Standards, Environment, and also Anti-Corruption. It is encouraging to see how both the UN Global Compact and the United Nations Convention on Corruption have come to mutually reinforce the commitment of the corporate sector to act against corruption. In early 2008, within a follow-up convention by state parties to the UN convention against corruption, in Bali, Indonesia, a special event was held aiming at promoting a Business Coalition: the United Nations Convention against Corruption as a New Market Force, which led to the adoption of the Bali Business Declaration.

This declaration by the corporate sector recognizes -inter alia - that
• fighting corruption is a shared responsibility involving all stakeholders,
• business has a role to play in curbing corruption
• business will support the 10th principle of the UN Global Compact, (which states that the private sector should work against corruption in any form and manifestation, including bribery and extortion)
• And that although principles are voluntary, failure to implement them puts companies at serious risk.

It is very encouraging to see that the business coalition explicitly recognizes the importance of the United Nations Convention against Corruption and even calls upon governments, who have not done so, to ratify the Convention, to establish an effective mechanism to review its implementation and to include participation of business in such a mechanism. We look forward to the next State of Parties conference of the United Nations Convention against Corruption to be held in November in Doha to witness further progress in the prospering of the Business coalition and its involvement in the promotion of the 10th principle of the Global Compact and the implementation of measures as outlined by the UNCAC.

As the United Nations Office on Drugs and Crime, we assist countries in the implementation of various UN conventions and universal instruments related to drugs, crime, corruption and terrorism. We do this together with Governments, but we can also do it together with the corporate sector and the civil society. With regard to our work with the corporate sector, we have built sustainable coalitions with the corporate world under the UN Global Initiative to Fight Human Trafficking (UN.GIFT) initiative for the promotion of safe and honourable tourism through a code of conduct and for the establishment of a Think Tank for promoting public private partnerships on anti human trafficking issues. Similarly we are working with the IT and ITES sectors to support drug use prevention at the work place.

I see a similar scope for building sustainable coalitions in the areas of transparency and anti-corruption in the spirit of the tenth principle of the UN Global Compact and the United Nations Convention against Corruption working towards a public private partnership for creating the demand for corruption free corporate governance. It is encouraging to see that the Government of India has already implemented a series of tangible measures to increase transparency and reduce possibilities for corruption, such as e-governance solutions, the enactment of the Right to Information Act and the adoption of the Transparency International's Integrity Pact concept in public procurement. With such initiatives in place, the time is right, to think about and launch effective anti corruption initiatives also by the corporate entities in India.

The workshop agenda includes presentations by an impressive list of speakers who are going to cover various facets of the subject. I am confident that the subsequent working sessions will stimulate active debates and that specific recommendations will be drawn which will allow the momentum to be carried forward and proceed to action.

I would like to conclude by expressing my appreciation for your participation here as well as my trust and belief that the Indian corporate world will and can become a change agent by embarking on proactive steps such as self regulation and advocacy for policy reform. With this, I wish the participants a very enjoyable and fruitful experience and express my sincere appreciation to the organising committee for their efforts.

Thank you