This module is a resource for lecturers
Corruption is a complex phenomenon, without a uniform definition. An overview of the different forms and definitions of corruption, as well as its harmful effects across the globe, is available in Module 1 of the E4J University Module Series on Anti-Corruption. For present purposes, it should be noted that the United Nations Convention against Corruption (UNCAC) refrains from providing one overarching definition of "corruption". Rather, it defines and classifies various forms of corruption as criminal offences, such as bribery and embezzlement (in both the public and private sectors); abuse of functions (i.e. when those performing public functions misuse their power to obtain a benefit); trading in influence; illicit enrichment; and money-laundering. With 186 States parties (as of November 2019), UNCAC is approaching universal adherence, and the different forms of corruption as defined by the Convention can be considered internationally accepted.
This Module discusses two related topics: the phenomenon of corruption in the private sector, including its forms, causes, consequences, responses and prevention measures, and the ways in which the private sector can contribute to the fight against corruption. These two aspects of the Module are intertwined because some of the means of fighting corruption in the private sector can also help to reduce and prevent corruption in society more broadly. Thus, the Module focuses on different measures that businesses can take to fight and prevent corruption internally, such as risk assessments, anti-corruption ethics and compliance programmes, and codes of ethics, but it also addresses collaborative approaches that prevent corruption both in the private sector and in society more broadly. The Module does not discuss anti-corruption measures such as law enforcement and whistle-blowing regulations - these are discussed in Module 6 and Module 13 of the E4J University Module Series on Anti-Corruption.
Public sector corruption versus private sector corruption
When learning about private sector corruption, it is helpful to keep in mind the differences between private sector corruption and public sector corruption. For present purposes, public sector corruption primarily abuses government resources whereas private sector corruption primarily abuses private or commercial resources. While UNCAC defines a number of different corruption offences, corruption is sometimes understood in general terms as "the abuse of entrusted power for private gain", in accordance with the definition proposed by the non-governmental organization Transparency International (TI). It is clear from both the TI definition of corruption, as well as the corruption offences defined in UNCAC, that corruption occurs in both the public and private sectors. Public officials are entrusted with power to serve the public interest, whereas employees in the private sector are entrusted with power to serve legitimate company interests. In both contexts, corruption occurs when individuals or organizations promote interests that differ from the interests they were entrusted to serve. Identifying what interest should be served, and who or what is being served instead, can help us distinguish between public sector corruption and private sector corruption. Public sector corruption is addressed in Module 4 of the E4J University Module Series on Anti-Corruption.
The following sections of the module provide an overview of:
- Forms and manifestations of private sector corruption
- Consequences of private sector corruption
- Causes of private sector corruption
- Responses to private sector corruption
- Preventing private sector corruption
- Collective action and public-private partnerships against corruption