VIENNA, 9 December 2009 - On the International Day against Corruption, the Executive Director of the United Nations Office on Drugs and Crime (UNODC), Yury Fedotov, urged the private sector to make more effective use of the United Nations Convention against Corruption - the world's strongest legal instrument to build integrity and fight corruption. The Convention, which came into force in December 2005 and has 147 Parties, includes strong measures to prevent and fight corruption applicable to both the private and public sectors.
Corruption threatens the transparent and fair conduct of business. Economic crime seems to be on the increase. The Convention can help companies to build oversight and curb financial crime such as bribery, counterfeiting, major procurement fraud, money-laundering, embezzlement and tax evasion.
Secretary-General Ban Ki-moon stressed that fighting corruption is a shared responsibility that requires cooperation between all stakeholders to achieve the Millennium Development Goals but cautioned: "The private sector can play a key role in fostering development, but it is lagging behind the public sector in its efforts to stop corruption."
Corruption poses serious threats to society. But the economic impact of graft is no less damaging. "Private-sector corruption distorts markets, stifles economic growth and discourages foreign investment. It can damage the environment and public health. It holds back development and the achievement of prosperity" said Mr. Ban. Importantly, the Convention includes guidance for the private sector that can make it part of the solution rather than merely a victim of corruption.
So there is every incentive for the private sector to act since stronger economies and more prosperous societies are good for business. And payoffs are a form of illegal tax. "Corruption eats into profits; it is a hidden overhead charge that increases prices and reduces product quality. Corruption undermines business confidence and corporate integrity and destroys the reputations of respected companies," said the Secretary-General.
Anti-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. UNODC is helping "equip" the private sector to face its challenges. On this Day, it launched a product jointly with the UN Global Compact, an e-learning tool aimed at people who act on behalf of a company to deepen their understanding of the UN Convention against Corruption and the role of the private sector.
The private sector is taking steps to ensure transparency. Companies may increasingly be required to prove that they are responsible and reliable. Citizens are waking up to the fact that impunity for corrupt practices has gone on too long. Some banks have effectively scrapped secrecy laws, which are no longer an obstacle to money-laundering investigations. More private companies are establishing ethics and compliance programmes to build the foundations of an accountable work-force.
But much more needs to be done. "I challenge businesses to set the tone from the top with a zero-tolerance policy for corruption" said the Secretary-General. "Adopt anti-corruption policies in line with the UN Convention and put in place the checks and balances needed to strengthen integrity and transparency".