Author Archives: Stephen Rosenlund

Getting Creative about Saying “No!” to Corruption in Lebanon

Graffiti art produced at LTA-LABN’s public rally held in the Beirut Souks, September 12, 2014.

Graffiti art produced at LTA-LABN’s public rally held in the Beirut Souks, September 12, 2014.

CIPE partner the Lebanese Transparency Association (LTA) recently wrapped up a banner month in its fight against corruption in Lebanon. CIPE’s partnership with LTA dates back over ten years, and since 2012 CIPE has been supporting LTA through a grant from the U.S. Department of State’s Middle East Partnership Initiative (MEPI) to strengthen the rule of law in Lebanon. Our approach has been not only to raise public awareness, but also to empower citizens to exercise their rights. This effort has been consolidated primarily through the Lebanese Advocacy and Legal Advice Center (LALAC) and the Lebanese Anti-Bribery Network (LABN), both of which are housed and managed by LTA.

LALAC operates centers in Beirut, Bekaa, and Nabatieh, which are staffed by attorneys and legal assistants who field complaints of corruption from citizens across Lebanon. Through LALAC, citizens can report corruption by calling the LALAC hotline, writing a letter or e-mail, or visiting one of three centers in person.

LALAC Legal Advisor Carol Sabty, LTA Grassroots Manager Said Issa, and the author (center) discuss LALAC’s capabilities in the fight against corruption during an outreach session with citizens in Kfardebian, Lebanon.

LALAC Legal Advisor Carol Sabty, LTA Grassroots Manager Said Issa, and the author (center) discuss LALAC’s capabilities in the fight against corruption during an outreach session with citizens in Kfardebian, Lebanon.

Since CIPE’s direct support for LALAC began approximately one year ago, LALAC has achieved an unprecedented level of activity. A total of 453 complaints have been made during that time, 277 of which directly relate to corruption. In 224 cases, LALAC has provided citizens (“clients”) with legal advice on the process of vindicating their rights (short of providing representation in court) and sought resolution with cognizant public institutions.

If LALAC were a law firm, it would be doing a brisk business. But LALAC doesn’t bill its clients. It exists to empower the victims of corruption as champions for reform and to hold public officials accountable. LALAC has already worked directly with more than 15 public institutions to achieve resolution of individual cases and achieved some notable successes. Moreover, LALAC is negotiating memorandums of understanding (MOUs) with numerous public sector entities to cooperate in resolving complaints of corruption – remarkable progress in a country where openly talking about corruption was taboo not long ago.

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Investing in Corporate Governance Practice in Palestine

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Program Officer Stephen Rosenlund discusses best practices in corporate governance based on CIPE’s experience in the MENA region.

On September 9-10 in Ramallah, I had the privilege of participating in a CIPE-supported training workshop on corporate governance with the leaders and technical staff of nine Palestinian chambers of commerce from the West Bank. This was an unprecedented gathering organized by our partner the Palestine Governance Institute (PGI) and the Federation of Chambers of Commerce, Industry, and Agriculture to activate the chambers as resources for their member firms on corporate governance matters.

The two-day training workshop immersed participants in applicable legal and regulatory frameworks, the role of oversight institutions, and best practices in corporate governance at the firm level. While the different requirements applicable to publicly traded and private companies were examined, presenters emphasized the imperative for all firms regardless of size or ownership structure to adopt sound corporate governance practices. Data from numerous studies show that investing in corporate governance is a good business decision that enhances the performance and sustainability of companies. In addition, it has a positive aggregate effect on society in the form of economic development.

Moreover, well-governed companies tend to act ethically — by resisting paying bribes, for example — and therefore reduce the amount of corruption in society. A private sector that has its own house in order is also better positioned to engage in dialogue with public officials to bring about needed policy, legal, and regulatory reforms that will improve the environment for business.

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The Gathering

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With all due respect to CIPE’s other partners, surely the coolest workspace in the CIPE family today is located in Saida, Lebanon. The innovative space, called El Moltaqa (“The Gathering”), is the new home of the Development of People and Nature Association (DPNA). El Moltaqa is not merely an office for DPNA’s dedicated staff, it is a focal point for civic engagement in the community.

In its first decade of existence, DPNA has become a highly-respected convening authority for a range of local stakeholders from the private sector, civil society, public officials from the local and national levels, young activists, and others representing the diverse fabric of Lebanese society.

Unfortunately, that fabric is frayed due to a highly volatile geopolitical situation, which makes a place like El Moltaqa all the more vital. It is a sanctuary where people from every religion, sect, ethnicity, and political persuasion can feel safe. Through a rich array of cultural and educational offerings, El Moltaqa provides the community with a place to engage respectfully in democratic dialogue and debate about the most important issues of the day.

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Repairing a Shattered Syrian Economy in the Midst of War

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The common thread that unites all of CIPE’s partners around the world is their dedication to the principles of democracy rooted in private enterprise and free market economics. In all other respects, their diversity is remarkable and represents one of CIPE’s greatest sources of strength.

Ranging from the smallest of local business associations and youth groups to large chambers of commerce and some of the world’s most respected think tanks, our partners all work hard to advance freedom and secure new opportunity for their fellow citizens. They also operate under circumstances as varied and complex as the global geo-political landscape itself. Some of our partners work in conflict environments that require a particular blend of courage and creativity in order to advance their democratic objectives.

The current catastrophe in Syria certainly presents unique challenges to CIPE’s partner the Syrian Economic Forum (SEF), an independent think tank formed in 2012 by business people from across Syria to inform the public policies that will be needed for the country to emerge from conflict and transition to democracy. It may sound starry-eyed to speak of peace and democracy with the war now in its fourth year, at a cost of more than 160,000 lives, over 2.8 million refugees, $143.8 billion in economic losses (as of the end of 2013), three-quarters of the population living in poverty, and incalculable social trauma.

However, SEF and the moderate business community it represents see no other alternative. Independent small and medium business people from across the country, representing the mosaic of religions and ethnicities for which Syria has long been renowned, are a unifying force with the potential to repair and rebuild a now shattered society.

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Addressing the 98 Percent: Supporting Reform Among Family Firms in the Palestinian Territories

pgi-cgMore than 98 percent of commercial entities in Palestine are not covered by existing corporate governance codes, which apply to companies listed on the Palestine Stock Exchange and commercial banks. Most of these are structured as family firms — whether in ownership or management — which creates special difficulties for corporate governance.

To address the thousands of family firms that form the heart and soul of the Palestinian private sector, CIPE partner the Palestine Governance Institute (PGI) recently published a Corporate Governance Manual for Family Firms (available in Arabic and English) with the Federation of Palestinian Chambers of Commerce, Industry and Agriculture.

This seminal publication — the first of its kind in Palestine — was informed by extensive consultations with local experts, family firms themselves, and other stakeholders including lawyers and academics.

PGI engaged in extensive outreach to the business community in developing these guidelines, including conducting a baseline assessment through interviews with over 100 owners and managers of family firms across the West Bank and Gaza.

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Lebanon’s Development for People and Nature Association Marks Ten-Year Anniversary

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CIPE’s greatest strengths come from its partners. I am privileged to work every day with courageous individuals and organizations across the Middle East (and the world), who share our democratic values and want to help their communities achieve new freedoms and opportunity. Among them is the Development for People and Nature Association (DPNA) of Lebanon, with whom CIPE has been partnered since 2006. I wrote recently about our work with DPNA, in the midst of challenging times, on CIPE’s Community of Young Entrepreneurs Blog.

Yesterday, DPNA celebrated ten years since its establishment. CIPE is honored to have played a role in DPNA’s work over much of its history. DPNA is a highly ambitious and dynamic organization. Its programs range from environmental initiatives, to humanitarian assistance, to reforming the entrepreneurship ecosystem – the field in which our cooperation is focused.

With CIPE’s support, DPNA is helping Lebanon’s youth turn their entrepreneurial ambitions into reality and become productive members of civil society through various education, training, and mentorship initiatives. As part of a national coalition to reform the Lebanese educational system, DPNA is ensuring that the principles of entrepreneurship are included in curricula at all levels of school. These are impressive feats for a small NGO from southern Lebanon.

On behalf of all of us at CIPE, congratulations to our friends at DPNA on this tremendous milestone, and best wishes for another ten years of even greater success!

Stephen Rosenlund is Program Officer for the Middle East & North Africa & CIPE.

A Collective Action Approach to Combating Bribery in Lebanon

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Eighty-one percent of Lebanese business owners and managers believe the level of corruption in the country has increased over the past two years, and another 11 percent believe it has at least stayed the same. Nearly all (97 percent) recognize that this is a problem. These are among the more eye-opening results of a new nationwide survey conducted by CIPE partner the Lebanese Transparency Association (LTA) which is informing the next chapter in the work of the Lebanese Anti-Bribery Network (LABN).

The LABN was established by LTA in 2008, with CIPE support, as a multi-stakeholder network of professionals dedicated to researching issues related to bribery in Lebanon, raising public awareness, and encouraging public officials to take measures to curb corruption. The LABN has published two works to help the private sector in the fight against corruption – a “Code of Ethics and Whistleblower Procedure for Small and Medium Enterprises” and a “You’re Being Audited” guide to the public audit process. The LABN also released several research papers on bribery and corruption in specific sectors, including electricity, taxation, and construction.

On June 27, 2013, LTA and CIPE held a LABN workshop to explore the latest data on corruption in Lebanon and develop a strategy for collective action. Among the more than 40 participants at the event were company executives, civil society activists, and government officials. CIPE’s Senior Knowledge Manager, Dr. Kim Bettcher, presented a variety of private sector-led collective action models for the group’s consideration.

The survey revealed that corruption is not confined to any one sector in Lebanon, nor can it be fought by any one constituency alone. LABN is unique in Lebanon in that it brings together unlikely partners to advance an anti-corruption agenda – grassroots and high-level stakeholders; government officials and business leaders; civil society groups and the media. Through their collective action, the members of the LABN aim to fundamentally transform the way the private and public sectors and civil society relate to each other in Lebanon. Only together can these diverse constituencies develop a sustainable strategy and effective techniques to curb endemic corruption in the country.

Based on the results of the national survey and the group’s strategic priorities, the LABN will be developing a plan of action in the coming months to take the fight against corruption in Lebanon to the next level. Through a series of focused initiates, LABN will demonstrate the tremendous potential of private sector-led collective action in bringing about a more just and inclusive society.

While the results of the survey may seem discouraging at first blush, the LABN views them in a more optimistic light. In contrast to a previous survey conducted in 2010, private sector leaders are now more aware of corruption at all levels of society and are willing to speak out against it. Simply put, corruption is no longer taboo in Lebanon. LABN is poised to harness the private sector’s frustration in the form of collective action to advance constructive proposals for reform.

Stephen Rosenlund is a Program Officer for the Middle East & North Africa at CIPE.