Every day on the news we hear about challenges that countries face, ranging from domestic crises to natural disasters. At the same time, we learn about opportunities for advancement created by new technologies and global markets. How ready are countries to absorb negative shocks and capitalize on positive changes? This is the question that KPMG, in cooperation with Oxford Economics, seeks to address through the 2013 Change Readiness Index (CRI).
The index, this year in its second and expanded edition, assesses the ability of 90 countries around the world – from Australia to Afghanistan – to manage change and cultivate opportunity. Based on the analysis of secondary data and primary surveys of over 500 country experts, the index looks at three key elements: enterprise capability, government capability, and people & civil society capability. This data is also accompanied by several case studies that put CRI to the test, looking for instance at the varied capacity of countries to respond to major earthquakes (Haiti, Chile, and Japan).
Participants at the Frankfurt workshop.
Effective legal and regulatory reforms are key to improving governance and creating an entrepreneurship ecosystem conducive to economic growth and shared prosperity. Yet in many countries passing and implementing new laws and regulations remains a top-down process that receives little input from stakeholders who are directly affected.
All too often such reforms, even if they appear promising, remain on paper only since they lack broader ownership and support. In order to make the reform process more transparent, accountable, and fruitful, governments need to involve various segments of the society in the reform process. That involvement is particularly crucial when it comes to private sector organizations given that they represent the broader business community – the backbone of economic growth.
This crucial multi-stakeholder engagement process of public-private dialogue (PPD) was the topic of the recent 7th PPD Global Workshop in Frankfurt, Germany, co-organized by the World Bank Institute (WBI), the German Federal Ministry for Economic Cooperation and Development (BMZ), and the German Society for International Cooperation (GIZ).
The workshop gathered 145 participants from 41 countries, including the donor community, government representatives, and the private sector. It focused on key issues in designing, conducting, and evaluating PPDs, with experiences and approaches on what works shared among the participants. CIPE and several of its current and past partner organizations from Bangladesh, Ethiopia, and Senegal took part in this exciting event.
Corruption is one of the biggest challenges facing the developing world: it has a corrosive effect on democratic governance, undermines public trust, and wastes scarce resources. Crucially, corruption also represents a destructive tax on the private sector that hampers economic growth and development prospects.
A new paper by the Center for Strategic and International Studies’ (CSIS) Project on Prosperity and Development, The Costs of Corruption: Strategies for Ending a Tax on Private-sector Growth, estimates that narrowly-defined private sector corruption in 105 developing countries amounts to over $500 billion, 3.7 times the amount of official development assistance in 2011. While businesses are often blamed for corruption, and in particular bribery, the paper recognizes that corruption has both supply and demand sides, and that while businesses may contribute to corruption, they are also victims of it. As such, business must be a part of successful solutions to the corruption problem.
This is the point that CIPE constantly emphasizes – and applies – in its work around the world. In fact, the report cites numerous examples of CIPE’s successful anti-corruption programs, including collective action among leading companies in Thailand, legal reforms to guarantee disclosure of procurement contracts in Egypt, work on corporate governance and SME policy advocacy in Russia, improving public procurement transparency and governance in Kosovo, streamlining Armenia’s tax code, and strengthening property rights and supporting legal institutions in Kenya.
Women are essential to peaceful, democratic development of their societies. As the UN Women Executive Director Phumzile Mlambo-Ngcuka noted in a recent speech on the role of Syrian women in the peace process, “By including the perspectives of half the population, the path is paved for a society built on the principles of inclusion and justice.” In recent years, that fact has become more widely recognized, with many new local and international institutions and initiatives aimed at helping women achieve their full potential and participate on equal footing in the political, economic, and civic lives of their countries.
I was happy to see that Georgetown University, my alma mater, took active leadership in elevating the discussion and research on the importance of women for a more stable, peaceful and just world through the creation of the Institute for Women, Peace and Security (GIWPS). The establishment of the Institute was announced by Georgetown’s President John J. DeGioia and then-U.S. Secretary of State Hillary Clinton at Georgetown on December 19, 2011 when the Secretary unveiled the United States’ National Action Plan on Women, Peace and Security.
Anti-corruption compliance has become one of the key issues that companies around the world need to tackle, especially if their business involves extensive cross-border value chains.
The responsibility for designing and overseeing a compliance program, at least in larger companies, lies with an ethics and compliance officer or department. That’s not an easy job. Robust compliance requires sufficient resources; a communication strategy – both internal and external – to convey company values, policies, and procedures; a level of trust among employees to voice concerns and flag violations; and above all, a clear commitment from the board and top management.
Not surprisingly, in many companies at least some of the elements necessary for sound compliance need more attention and remain on a compliance officer’s wish list. In a recent blog, Michael Scher, who has over three decades of experience as a senior compliance officer and attorney and work for major companies in New York and the Middle East, shares several such items. Based on 2013 trends Scher complied 10 areas where more needs to be done, which can be summarized in the following categories:
A recent CEO study on sustainability conducted by the UN Global Compact and Accenture – the third one of its kind – reached out to more than 1,000 executives from 27 industries in 103 countries around the world, asking for their views on the past, present and future of sustainable business. This largest-ever CEO study on sustainability offered a mixed picture of global movement in the positive direction juxtaposed with the frustration over slow progress.
In the previous edition of this study, conducted in 2010, CEOs were optimistic that sustainability – understood as the active management of social, environmental, and governance issues as a part of core business – would soon become a norm embedded into operations of companies worldwide, with leadership on sustainability incentivized and rewarded. In 2013, 63 percent of CEOs still expect sustainability to transform their industry within five years and 76 percent believe that embedding sustainability into core business will drive revenue growth and new opportunities. However, the predominant feeling is that global business efforts on sustainability may have plateaued, and despite deeper awareness and commitment levels many business leaders deem the pace of change and the scale of impact insufficient.