Author Archives: John Morrell

Introducing Corporate Compliance Trends, a Website for Anti-Corruption Compliance in Emerging and Frontier Markets

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The need for anti-corruption compliance programs in companies of all sizes in global value chains has never been greater. Since 2006, the U.S. government has settled or prosecuted nearly 300 corruption cases against companies from around the world, including many where the corrupt conduct originated from multinational corporations’ suppliers, vendors, and agents. The average cost of resolving these enforcement actions now tops $80 million.

Beyond the U.S. Foreign Corrupt Practices Act (FCPA) and the UK Bribery Act, new anti-corruption laws with international reach are hitting the books, such as Brazil’s Clean Companies Act, introduced earlier this year. Similarly, many international bodies, including the Organisation for Economic Co-operation and Development (OECD) and the International Chamber of Commerce, have introduced conventions and norms meant to combat bribery of foreign officials. Few doubt that this growing global trend toward rooting corruption out of international business conduct is here to stay.

Still, as a recent study found, the number of global companies with anti-corruption policies has increased by only 1 percent over the past two years, and a sizable minority of these companies have yet to implement even the most basic of compliance programs. Nearly 60 percent of global companies surveyed said they never train third parties despite the fact that many compliance actions have resulted from conduct by agents or intermediaries.

While governments and international organizations set anti-corruption rules and standards, and while law enforcement agencies around the world aggressively pursue potential violations, many companies simply lack sufficient practical knowledge on how to comply with these new global norms. Understanding what effective anti-corruption compliance looks like and how to set up internal compliance programs that mitigate the risk of corruption is an especially daunting challenge for firms operating in emerging and frontier markets, where the Center for International Private Enterprise (CIPE) has worked since 1983 with local partners such as chambers of commerce, business associations, and economic think tanks.

To share our experiences from supporting private sector-focused anti-corruption programs in high-risk countries around the globe, and to help advance international best practices on anti-corruption compliance in these countries, CIPE is launching this new website, Corporate Compliance Trends.

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Corrrupt Land Grabs Imperil Burma’s Democratic Transition

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The United Nations Universal Declaration of Human Rights states that “Everyone has the right to own property [and] no one shall be arbitrarily deprived of his property.” In Burma, a country in the early stages of its emergence from a half century of military rule and central economic planning, property rights violations could threaten democracy itself.

Burma lacks many institutions necessary for a market-oriented democracy, such as a reliable court system, dependable electricity, and accessible financial services. The country’s physical infrastructure is also woefully inadequate. Paramount among these issues is rampant corruption and terrible public governance – issues that manifest in the “land-grabbing epidemic” which is sparking protest and civic unrest.

Read the rest of this article at the Thomson Reuters blog.

Business Women Take Charge in Papua New Guinea

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The first shipment of liquefied natural gas is set to leave the shores of Papua New Guinea (PNG) in late May. This multi-billion dollar project is among the largest investments in the country’s history, and its success contributed to the country’s strong GDP growth in recent years. Foreign direct investment is up, and the current government is pursuing a largely free-market and pro-investment economic strategy.

This good news has an unfortunate caveat, however: women have had virtually no input in the country’s policy dialogues, and the country’s economic performance is occurring despite the continued economic marginalization of women.

Papua New Guinea ranks among the world’s worst performers in almost every global indicator of gender inequality. This sad reality is manifested in shocking statistics of gender-based violence, social inequality, political exclusion and economic marginalization.

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Corruption Allegations Roil Thailand — Again

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This article originally appeared on the Thomson Reuters TrustLaw Governance blog.

Thailand lifted its state of emergency, and the February 2 elections have been annulled.  Encouragingly, the leaders of the government and the opposition are signaling – albeit tentatively and obliquely – a willingness to negotiate an end to the country’s ongoing political crisis. But even if Thailand can extricate itself from its latest political quagmire, the next crisis is probably not far off if the underlying problems are not addressed.

More than any other issue, corruption has served to delegitimize successive governments in the eyes of competing segments of Thai society. In 2006, the military ousted an elected government and in 2008, the Supreme Court disbanded an elected government; in both cases, the stated justification was corruption. Likewise, allegations of corruption are among the paramount drivers of the anti-government protests taking place in Bangkok today, just as they were in the color-coordinated protests of recent years.

And this frustration with corruption is not limited to corruption in electoral processes or campaign fraud. Corruption is a daily phenomenon for many citizens and businesses, and people are fed up with it.

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CIPE Helps Inspire Leaders of Papua New Guinea’s First Women’s Chamber

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In a partnership with the U.S. Department of State and the U.S. Embassy in Port Moresby, CIPE is supporting the development of the recently-established Papua New Guinea Women’s Chamber of Commerce and Industry (PNGWCCI), the first and only women’s chamber in Papua New Guinea (PNG).

CIPE arranged for the senior leadership of PNGWCCI to attend a CIPE conference in Colombo, Sri Lanka that convened a network of women’s business groups from across the region. At this conference, which the Papua New Guinean participants described as “inspiring” and “eye-opening,” PNGWCCI saw first-hand that women’s chambers can be hugely successful even in difficult national environments for women, and relationships were established with other Asian chambers that could be invaluable mentors for PNGWCCI.

The women from PNG told CIPE that “we came home more enthusiastic than ever!”

More recently, at a training program in Port Moresby, a CIPE delegation worked with the leaders and members of PNGWCCI to develop an organizational vision, strategic objectives, along with tangible short and medium-term action plans to accomplish them.

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A Big Step Forward for Women Entrepreneurs and Leaders in Papua New Guinea

Papua New Guinea ranks among the world’s worst performers in almost every global indicator of gender equality, including gender-based violence, social inequality, political exclusion, and economic marginalization. The lack of prominent, respected, capable, and well-organized advocates for gender equality and women’s rights directly contributes to the sociopolitical and economic marginalization of women in Papua New Guinea.

In a partnership with the U.S. Department of State and the U.S. Embassy in Port Moresby, CIPE is supporting the efforts of a pioneering group of women who recently established the Papua New Guinea Women’s Chamber of Commerce and Industry (PNGWCCI). These visionary Papua New Guineans seek to change the operating environment faced by women in PNG, and this week saw a major step forward in this effort. From February 17-21, a CIPE delegation conducted the first of several planned training programs for the leaders and members of PNGWCCI.

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Approaches to Collective Action: How Businesses Together Can Lead the Fight Against Corruption

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Corruption is a direct threat to a country’s democratic emergence and an obstacle to a country’s democratic development. In Thailand, for example, corruption was the stated justification for the military’s ousting of an elected government in 2006 and the Supreme Court’s sacking of another elected government in 2008. Competing allegations of corruption were the main drivers of nation-crippling unrest in the country.

In Thailand, as in other new and struggling democracies across the globe, if democracy is to mature and fully take root, more is required than just the ability to vote.

In countries including Russia, Thailand, Columbia and Serbia, CIPE is helping the private sector mobilize to take proactive steps to reduce corruption. These programs demonstrate the transformative impact that private sector Collective Action can have on a country’s fight against corruption.

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