Corruption is often perceived simply as a problem of opportunistic state officials who use the power of their public office to extract bribes and other illicit contributions. But it’s important to remember that corruption is a two-way street: for a bribe to be accepted, one first has to be offered by an individual or a business. Therefore, corruption in the private sector and corruption in the public sector reinforce each other – and economic waste. Ruslan Stefanov, Economic Program Coordinator at the Center for the Study of Democracy in Bulgaria, talks about this issue in his CIPE Development Institute presentation (free registration required):
- “If the private sector is corrupt, we have squandering of economic, environmental, human, and financial resources, which leads to lower economic growth. Corruption is a tax, and it’s a tax that doesn’t return public value.”
Several international conventions have been put in place to combat corruption in the private sector, such as the OECD Anti-Bribery Convention or the Business Principles for Countering Bribery. Many other approaches can be adopted by businesses as well: good corporate governance and corporate citizenship frameworks, codes of conduct, rules of disclosure, or guidelines preventing conflicts of interest. At the same time, governments should ensure open and corruption-free business environment where the rules of the game are the same for all and business interests are legitimately represented.
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Published Date: January 23, 2009