Corruption: businesses have the power to effect positive change
27 January 2012 - Yury Fedotov, Executive Director of UNODC, has invited business leaders to intensify public-private partnerships to curb corruption. Delivering a keynote address to chief executives attending the 2012 World Economic Forum at the Swiss resort of Davos, Mr. Fedotov stressed the power of businesses to effect positive change.
Corruption distorts markets, driving up costs for companies - and ultimately for consumers - whereas prosperous societies are good for business. The United Nations Convention against Corruption is the first and only global instrument designed to prevent and combat corruption, but it is not just for Governments - it includes guidance for the private sector also. The UNODC Executive Director stated that his Office stood ready to help businesses to adapt their policies in line with the provisions of the Convention.
UNODC has entered into fruitful public-private collaboration, for example, to promote private-sector engagement in combating corruption with support from the Siemens Integrity Initiative. United Nations Secretary-General Ban Ki-moon has recognized that such partnerships offer innovative solutions. Countering corruption is now firmly established as one of the principles of the United Nations Global Compact, the largest corporate sustainability initiative in the world and one of the Organization's main interfaces with the business community. Indeed, the Global Compact will soon be meeting in Vienna to explore options for greater cooperation with his Office, the UNODC chief said.
More companies are establishing ethics and compliance programmes to build an accountable workforce, but more could be done to promote anti-corruption corporate policies in line with the Convention, Mr. Fedotov said. He proposed that businesses should put in place the checks and balances needed to strengthen accountability; establish an anti-corruption performance review mechanism, designed and governed by business; strengthen public integrity in developing countries; and invest in the supply chain so that large corporations could help small businesses to fight corruption.
At the premier forum of captains of industry, Mr. Fedotov unveiled the idea of an integrity initial public offering (IPO), which would enable UNODC to support developing countries in their efforts to develop anti-corruption legislation and institutions. Under the scheme, companies would pledge $2 million over five years, sending out a strong message of integrity to shareholders and customers while enhancing their global anti-corruption credentials.
"For an amount that will hardly be noticeable in the balance sheets of most of you, I am offering you the opportunity to make an investment with a high return," said Mr. Fedotov. "The integrity IPO will be a potent insurance policy for protecting assets by investing in the integrity of your public counterparts." Companies could boost their reputation as "integrity leaders" by investing in the honesty of global markets. With tangible and durable results in sight, they could help to create a business environment based on greater solidarity and ruled less by volatility: "It is true that a recession is exactly the point when companies, operating in highly competitive markets, need to be assured of the fairness and equity of their business relations." UNODC would be able to offer concrete proposals for setting up the IPO in six weeks time, he said.
By instilling integrity and transparency in business, CEOs can create a level playing field, said Mr. Fedotov. The profits can be measured in more than just the bottom line; they can also help to lay the lasting foundations for ethical conduct and social justice, he said.