Global Policy Forum

By Ramesh Jaura

The vigilance of the media and civil society in the developing and developed lands is driving the corrupt out of their hideouts. But reporting on corruption remains a dangerous job.

This mix of a good and bad news strikes as highlight of a new report launched Wednesday by Transparency International (TI), the world's leading anti-corruption NGO. The study was released in Berlin and London ahead of the World Economic Forum (WEF) in Davos, Switzerland - a gathering of the political and economic big wigs and others keen to join their ranks.

The study titled Global Corruption Report 2003 features 16 regional reports on reforms and setbacks in combating corporate corruption around the globe and a series of articles on access to information.

"Simply by doing their jobs well, independent-minded journalists have played a central role in promoting democracy for many years. Many put their lives or freedom at risk to promote transparent and accountable governance and corporate behaviour," says the report.

"Of the 68 confirmed cases of murders of journalists in 2001, 15 were related to their investigative work on issues of corruption. This is an alarmingly high number."

The authors of the study are worried that since the events of 'September 11' new measures to block, reduce or slow down the flow of information - while increasing surveillance of access itself - have threatened to restrict media freedom.

In Jordan, for instance, new amendments to the penal code subject journalists to prison terms for publishing material that "could breach national unity, divide the population or damage the image and reputation of the state". In Saudi Arabia, all Internet service providers must now keep records of their users in order to track access to "forbidden" websites.

"The United States has begun withholding information deemed detrimental to "institutional, commercial, and personal privacy interests"; writes Bettina Peters in a contribution the TI report. Increased surveillance of the Internet, e-mail and telephone conversations was authorised in both Britain and Canada, while new French laws effectively criminalise the encryption of electronic messages.

In Germany, a new anti-terrorist law grants intelligence services the right to access stored telecommunications data and trace the origins of e-mail.

Global Corruption Report 2003 points to another significant phenomenon: there is a "crisis of trust" in the corporate sector around the globe. Cases in point are the Enron, Global Crossing and WorldCom scandals.

"The public no longer has any confidence that a given corporation's books show a true and fair statement of its finances." says TI chairman Peter Eigen.

Drawing together analyses from journalists and experts, the report presents recent developments in both corruption and the fight against it. "The corrupt are running out of places to hide" because "empowered by technology - essential to the prompt and accurate flow of information - the media and the public are increasingly calling businesses and politicians to account," says Eigen.

To ensure a quick and precise flow of information, national chapters of Transparency International have campaigned for freedom of information in Germany, Lebanon, Mexico, Panama and many other countries around the world.

"Under their scrutiny and that of other civil society organisations and the wider public, governments are taking steps to further the cause of transparency," notes Eigen.

From Chile and Brazil to South Korea and India, the spread of e-government involves increasing use of the Internet to disseminate public information and to open up the bidding process in public tenders and privatisations.

To a certain extent, unethical corporate behaviour can be deterred by international initiatives such as the 1997 Organisation for Economic Cooperation and Development (OECD) Convention on Combating Bribery of Foreign Public Officials.

However, legislative reform is not the only means to promote transparency. According to the study, within the corporate sector, many business leaders are taking up the challenge to curtail corruption.

Many businesses understand that stopping bribery makes sound economic sense. A survey carried out by Social Weather Stations in late 2001 found that entrepreneurs in the Philippines were willing to pay 2 per cent of their corporate net income to fund anti-corruption programmes.

They had estimated that preventing corruption would result in a 5 per cent increase in net income and a 10 per cent saving on contracts.

The Social Weather Stations was established 1985 as a private, non-stock, non-profit social research institution. The report points out that progress in the fight against corruption is also in evidence at the national level.

"Encouraging news has come from EU accession candidates in Central and Eastern Europe, where - along with pressure from international actors - political will and civil society efforts have promoted transparency and good governance. "

Yet progress is slow to reverse the damage corruption has caused to personal, public and corporate reputations. Throughout the world, the public has suffered a tremendous loss of confidence in politicians.

"While there is much room for improvement, the past 12 months did witness noticeable successes in the fight against money laundering and in the repatriation of stolen assets," observes the report.

The events of September 11 prompted the U.S. government and others to acknowledge the pernicious nature of money laundering and to urge the OECD's Financial Action Task Force to further tighten its anti-money laundering strictures.

International cooperation between the judiciary and police forces has increased, and in November 2001 the EU adopted a new directive on money laundering that obliges member states to combat the laundering of the proceeds of all serious crime, including corruption.

The Global Corruption Report 2003 also reflects a positive trend among donor agencies. While their efforts to curb corruption were noted in the 2001 report, organisations have become more demanding in the last year, insisting on a commitment to anti-corruption policies and procedures.

As civil society organisations have begun to organise themselves more effectively, especially in many countries on the African continent, they too are making important contributions to the anti-corruption cause, says TI chairman Eigen.

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