Private sector critical to fight corruption in East Asia - Pacific

Bangkok (Thailand), 26 November 2012
- Worldwide, nearly US$1 trillion in bribes are paid each year, according to a World Bank Institute estimate. In East Asia and the Pacific, home to nearly one-third of the world's population, corruption is a critical issue for the business community since high levels of corruption represent a disincentive for foreign direct investment and for the development of free and clean markets.

Getting private sector business actively involved in fighting corruption is critical if anti-corruption efforts are to succeed.

"UNODC considers it of fundamental importance that governments, civil society and international organizations get involved in the fight against corruption, by collaborating with the private sector to create a corruption-free business environment," said Mr. Shervin Majlessi, UNODC Regional Anti-corruption Advisor, in November in Bangkok, at the Collective Action Conference (CAC) The Responsibilities of Company Directors in Fighting Corruption, organized by the Thai Institute of Directors (IOD).

Thailand's National Anti-Corruption Commission (NACC) with support from UNODC brought together a number of anti-corruption stakeholders, including the IOD and the Thai Chamber of Commerce, which in turn created CAC as a network of private sector representatives committed to developing transparent business practices.

Mr. Majlessi made his comments at a discussion panel at CAC on global trends in the fight against corruption. He said that UNODC is committed to promoting the business community's efforts to prevent corruption

"Corruption is a complex issue with significant impacts on business and society," said Mr. Majlessi. "Nearly 50% of business executives surveyed in Indonesia and Malaysia believe their company has lost business in the last year due to corrupt practices by their competitors, according to a recent Transparency International survey."

"This kind of behavior not only damages competition - hampering the level playing field and honest competition among firms - but also hurts the community where companies operate, undermining the credibility of the government and lowering the quality of services provided," Mr. Majlessi said.

UNODC support to East Asia and the Pacific businesses includes disseminating tools for concrete anti-corruption activities and support to forums that enable business people to participate in the design and implementation of anti-corruption strategies by governments, and supporting the creation of corporate governance frameworks that contain corruption-prevention measures.

Among other regional initiatives to help the business sector combat corruption, the UNODC also participated in a Forum on the Implementation of the APEC Anti-Corruption Code of Conduct for Business in Manila 20-21 September. At the event, representatives from member countries of the Asia Pacific Economic Cooperation (APEC), including President of the Philippines Benigno S. Aquino III and Hon. Justice Conchita Carpio Morales, Ombudsman of the Philippines, discussed a number of measures to prevent corruption in the private sector.

Both forums also discussed the impact of corruption on small-medium enterprises (SMEs), which make up 90% of private firms worldwide. Due to their smaller size and limited capacities, SMEs are more vulnerable to corrupt practices when doing business.

"UNODC anti-corruption support work for SME's includes providing technical assistance to countries, advocacy and awareness-raising activities, and sharing knowledge and research on how to effectively tackle the problem." Mr. Majlessi noted.

"To that end, we've developed a set of tools, including the UNODC/Global Compact e-learning tool for the private sector and the UNODC/ PricewaterhouseCoopers compendium on the anti-corruption policies of Fortune 500 companies."