Global war on graft shifts to private sector and how firms can eliminate rot

You mentioned China. There have been criticisms from some in the North that China and India are coming in as investors and sometimes as donors, but not following the same kind of transparency standards that the OECD requires of its members. Does the Global Compact work with state enterprises from China and India?

We are very proud of our strong networks in both China and India. It is quite amazing how fast the learning occurs, and the willingness of major companies of these countries to embrace the compact and its philosophy.

We have for example a network in Sudan, with a strong participation of Indian and Chinese companies. No other companies could do better. Clearly massive investments were made, and when that happens things sometimes go wrong. But the infusion of capital is very welcome, because much of it goes into infrastructure, transportation and the like, which would otherwise not happen.

Reports about large-scale corruption in Africa often point to the role of foreign banks, in helping corrupt rulers deposit their spoils in hidden offshore accounts. The recent global financial crisis has also exposed the rot in many financial institutions. How does the Global Compact view such problems with banking institutions?

The financial crisis was a wake-up call to many. It has driven home the message that long-term value creation and short-term profit maximization are not necessarily the same. The heightened legal scrutiny, whether it is of tax evasion, the abuse of power or corruption, is most welcome. Having a clean finance sector that is not a hand maiden for the abuse of power is of critical importance.

In looking at anti-corruption initiatives in Africa, one often finds that civil society organizations and the media have played key roles. Do you find that it is easier to engage firms in states where there already have been open discussions about corruption?

The notion of transparency and the engagement of different actors is very important. The deeper meaning of fighting corruption is transparency. The more open societies are and the more information flows are supported, the easier it is for this anti-corruption agenda to be taken up.

How does the Global Compact’s anti-corruption agenda relate to its other goals?

Our 10th principle is our most fundamental one, because at its core it means good governance at the corporate level. You cannot achieve clean environmental performance, you cannot achieve good human rights respect if you do not have a clear notion of transparency and disclosure, and clear rules of the game under an ethical framework. It is very fundamental.

On anti-corruption, I am very optimistic that a growing number of companies are embracing this agenda. Not because they are worried that they may be caught and found not to be in compliance. But rather because being ethical does pay off.