In Transparency International’s most recent Corruption Perceptions Index, Russia has fallen to 154th place, tied with Laos, Guinea-Bissau, and Tajikistan. Russia’s leaders know that this situation is incompatible with their aim of building a more modern, innovative and diversified country. On the national level, the problem is not one of awareness. It is a lack of consensus on how to fight corruption.
Since coming to power, President Medvedev has made fighting corruption one of his top priorities, but even his senior officials have been forced to admit that successes have been few and far between. Domestic business leaders and foreign investors alike also appreciate the importance of fighting corruption to safeguard profits and grow Russia’s economy.
For nearly a decade, CIPE and its partners in Eastern Europe and Eurasia have been studying the problem of corruption in the region, developing a range of practical approaches with demonstrable results. This work has included projects in Armenia, Serbia, Bulgaria, and Russia. Last year, CIPE brought these partners together for a conference in Kyiv, marking the 20th anniversary of the Fall of Berlin Wall, to discuss these approaches. One of CIPE’s leading partners in the anticorruption effort is Russia’s Saratov Chamber of Commerce and Industry, which has spearheaded efforts to understand the “corruption potential” embedded in draft laws (in Russian).
The Saratov Chamber produced a new anticorruption tool that stands a good chance of enjoying widespread success. While considerable attention is focused on the national dimension of Russian corruption, the tool is based on examining the local and regional implementation of national law. The Saratov Chamber unveiled this innovative tool at CIPE’s September 2010 conference in Moscow.
The Saratov Chamber methodology, available in Russian and in English, identifies legislative gaps that can give rise to corruption, pinpointing contradictions among federal, regional, and local laws that provide bureaucrats with discretion to interpret the law. The process examines laws regulating procedures that entrepreneurs must complete to engage in business activities, such as obtaining licenses, bidding on procurement contracts, or buying land. The methodology involves surveying legal and government experts, analyzing laws, and generating recommendations to close loopholes.
CIPE supported seven other regional Russia chambers – in Astrakhan, Volgograd, Kirov, Krasnodar, Perm, Smolensk and Khabarovsk – in using the Saratov methodology to identify legislative “problem areas,” laying the groundwork for advocacy to close loopholes. Various regional examples can be found in Russian and in English. Business associations then advocate for passage of recommendations, and once reforms are implemented, associations are positioned to use the same approach to monitor compliance and effectiveness.
In sum, the approach tackles corruption by streamlining regulation, improving administration, and closing the “reality gap” between laws on the books and actual implementation. It is all part of CIPE’s USAID-funded “SME Policy Advocacy” program, launched in 2002. If adopted more widely, this new, private sector-led strategy has the potential to address the institutional underpinnings of corruption, eliminating factors that allow corruption to flourish in Russia.
About 65 government officials, politicians and business leaders attended the Moscow conference in September. CIPE and its partners presented the results to date of the work carried out in Saratov and the seven other regions, including the findings of a survey of over 400 regional legal specialists and government officials regarding implementation of legislation and the problem of corruption, and the concrete regional recommendations generated by CIPE’s partner chambers.
With participants including officials from the Ministry of Economic Development and the Federal Antimonopoly Service, CIPE and its partners argued for the wider adoption of the Saratov methodology by other business associations in Russia as a realistic way to boost the business climate, improve legislative implementation and fight corruption. The partners also offered a number of national-level legislative recommendations, including the passage of a Federal Law on Regulatory Acts and introducing standardized procedures for the provision of municipal services to business.
CIPE has already begun to see evidence that regional governments are willing to adopt this new approach to fighting corruption, with authorities in both the Smolensk and Saratov regions agreeing to adopt the methodology in 2011 by partnering with regional chambers of commerce to evaluate laws. Currently, CIPE is providing support to the eight regional chambers that pilot-tested the methodology for further advocacy to advance their recommendations, and will work with the Saratov Chamber and its national partners, RCCI and OPORA, for wider dissemination.