Strengthening Civil Institutions: Why Anti-Corruption Isn’t Just About Compliance

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Post By: Susan Divers, Susan.divers@lrn.com

Anti-corruption is in the spotlight.

In June, the first-ever UN General Assembly Special Session focused on corruption took place to shape the global anti-corruption agenda for the next decade. Not long after, U.S. President Biden deemed countering corruption as a core United States national security interest. This spotlighting of the importance of the fight against corruption was followed by a raft of actions in the U.S. and globally aimed at increasing law enforcement cooperation and preventing money laundering tied to illicit payments.

While headline-worthy and notable, there is little immediate impact on the programs core to companies’ efforts to fight corruption.

What is of consequence, however, are the connections being made in the broader business community, recognizing that the fight against anticorruption is central to Environment, Social and Governance (ESG) strategies and commitments and to being a responsible global citizen generally. This shift in mindset and priority has been a long time coming and moves anticorruption beyond compliance to the value creation side of business.

Consider: even when facilitation payments are legal and permitted, companies are beginning to realize that making facilitation payments to jump the queue for an X-ray in a state hospital skews the system, promotes and sustains bad governance and raises the “price” of an X-ray for the poor.

Anticorruption, of course, has always been a central tenet of compliance, but viewed more broadly and holistically, freedom from corruption underpins good governance, strengthens social institutions, and promotes fairness and accountability. For companies committed to ESG, anti-bribery isn’t just about compliance, it’s about sustainable models of doing business. A new framework from the UN Global Compact encapsulates that shift. It aligns with a recent panel, also from the UN, and highlights the need to raise the bar in business to adopt an ethical and values-based approach to culture, governance and leadership. This move to  “transformational governance” can generate double benefits: less corruption and human rights violations and greater shared value for  business, employees, investors, consumers, and communities.

The fact that anti-corruption is now viewed as integral to sustainability and integral to the ESG framework, Goal 16, and strategies to ensure responsible business generally is the big news on the anticorruption landscape. Taking this values-based approach helps reinforce that doing the right thing, even if not required by law, is consistent with sustainability and good governance and everyone in the long run.

 

About the Author:  Susan Divers, LRN Senior Advisor, leads LRN’s advisory practice focusing on helping companies build values-based, ethical corporate cultures that inspire principled performance and responsible workplace behavior and ensure compliance with all international, national and local laws. She provides senior-level counsel to ethics and compliance leaders around effective global ethics and compliance program management and strategy, code of conduct development and curriculum planning, and program design and deployment.