Corruption in international development

Corruption is not inevitable

Bribery and fraud are thriving, undermining aid effectiveness in many aspects of international development. It does not have to be that way. Practical and effective tools already exist to help improve transparency and accountability. But these tools are not yet used widely. Specific support services are needed for companies, clients and donors, but are not available. By spending a little time contributing your comments and suggestions through this web site, you can help turn the tide against corruption.

To provide or facilitate the specific services that would help curb corruption, it is proposed that an International Centre for Transparency in Construction should be established in Edinburgh. These services would include:

  • Support to and external verification of companies’ Anti-Corruption Procedures;
  • Accreditation of Independent Assessors when Integrity Pacts are used; and
  • Maintenance of related databases

Details of these services, which will be developed and provided in a constructive, innovative and cooperative manner, drawing on both supply-side and demand-side perspectives, can be found here.

RECENT DEVELOPMENTS AND NEW RESOURCES

Global Infrastructure Anti-Corruption Centre

Launched in 2008, The Global Infrastructure Anti-Corruption Centre (GIACC) is an independent not-for-profit organisation providing resources and services for the purpose of preventing corruption in the infrastructure, construction and engineering sectors. These resources and services are provided for the assistance of all stakeholders, including governments, project owners, funders, contractors, consulting engineering firms and suppliers of equipment, materials and services.  This is achieved mainly through information and education, enabled by web-based technology. See giaccentre.org for full details.

Fighting Corruption through Collective Action

Fighting Corruption through Collective Action - A Guide for Business and its companion web portal were launched in June 2008. This new guide outlines multiple options for combating market corruption based on proven “how-to” examples from many regions and sectors.  Cases from a diverse group of countries, including Mexico, Germany and Pakistan, are detailed in the guide, as well as a range of tools, such as decision trees and process steps, that help users to tailor collective action frameworks to their specific circumstances and needs.  See http://www.fightingcorruption.org for full details.

No More Corruption

Launched in 2008, nomorecorruption is an ambitious new initiative designed to improve anti-corruption communication between corporations and the communities they serve. This is achieved mainly through information and education, enabled by web-based technology. See www.nomorecorruption.net for full details.

Construction Sector Transparency Initiative (CoST)

The Construction Sector Transparency Initiative (CoST) is intended to reduce corruption on construction projects by making more information available for public scrutiny. Supported by DFID and the World Bank, it brings together the essential players in publicly funded construction projects, including government ministries and agencies, construction companies, and civil society. Working on the principle of “Get What You Pay For” it centres on making information readily available to, and accessible by, the public. Such information will include:

  • the purpose and location of a project;
  • its projected cost, and specification; and
  • the quality and cost of the final outcome.

Following a successful conference hosted by DFID in June 2007, several countries, including Tanzania, Zambia, Vietnam and the Philippines have agreed to implement this initiative on a 2 year pilot basis. The pilot phase was officially launched in Dar Es Salaam, Tanzania in May 2008. At this event it was stated that the UK was looking at how best to participate in the initiative.

Preventing Corruption in Infrastructure. Conference.

There was good attendance at this October 2007 conference, organised by British Expertise and the Association for Consultancy and Engineering. Speakers included senior representatives of UK companies, Transparency International, the Government of Tanzania, and Donor Agencies. Topics addressed included:

  • How UK business is responding to the challenge (seen from the perspectives of contractor, consultant and professional engineer).
  • How corruption is being prevented in the construction of the Beijing and London Olympic facilities.
  • The actions being taken by the UK and Tanzanian governments.
  • The anti-corruption actions and punitive measures adopted by the World Bank and EU Commission
  • An anti-corruption action plan for the sector.
  • Anti-corruption law and enforcement.

The conference was held under the Chatham House rule, so attributed views cannot be published. However, a general summary of the main features of the conference is included in the November Newsletter of the UK Anti-Corruption Forum.

Bribeline

Individuals can now report demands for bribes by government officials worldwide through the BRIBEline, the Business Registry for International Bribery and Extortion. Those exposed to bribe demands can report these incidents through a secure, anonymous, multi-lingual, web-based mechanism. By giving individuals and companies a viable place to report bribe solicitation, BRIBEline will help to reinforce the idea that this is an illegitimate activity. Visit www.bribeline.org for full details.

World Bank Publication

“The Many Faces of Corruption”, published in May 2007 by the World Bank, breaks new ground in providing compelling insights into the nature and scale of corruption in various sectors including construction, while offering practical proposals for remedial measures. A chapter on “Making inroads in the transport sector through control and prevention” refers to typical levels of corruption on road projects being between 5% and 20%, and even higher in some countries. When broader governance issues are included, the potential for savings in transport sector expenditure in develping countries is estimated as typically being between 10% and 40%. This is for a sector that normally accounts for between 10% and 20% of national expenditure. The economic consequences are assessed as being higher still, as corruption causes limited resources to be diverted to projects with lower rates of return. In response, the authors propose the use of prototype “road maps” to identify corruption vulnerabilities, suggesting corresponding “orange” and “red” warning signals. Specific proposed remedial measures are then set out, both at the sectoral level and for some critical cross-cutting public sector functions. Click here for details of this publication.

TI develops Project Anti-Corruption System (PACS)

Transparency International has developed a Project Anti-Corruption System (PACS) specifically for construction projects. PACS is a modular system which applies a variety of anti-corruption measures to all major project participants throughout their involvement in the project. These measures include independent monitoring, due diligence, contractual commitments, procurement requirements, government commitments, a corporate programme, rules for individuals, training, transparency, reporting and enforcement. PACS targets both bribery and fraud. Click here for details.

World Bank Voluntary Disclosure Programme

Launched in August 2006, this bold initiative is intended to encourage companies and individuals to come clean about past involvement in corrupt activities involving World Bank projects. In exchange for revealing all (in confidence) and implementing robust new internal procedures, they will be able to manage the risk associated with skeletons in the cupboard. Click here for details of the VDP.

Anonymous Surveys

Click here for the results of the Ethical Edinburgh June 2006 online survey of attitudes toward corruption in international construction projects. Future online surveys are planned, in order to continue drawing directly on the views of those most likely to understand both the true nature of, and the best ways of curbing, corruption on construction projects. Meanwhile, click here for details of similar surveys carried out by the CIOB into corruption in the UK construction sector.

Structure of site

The heart of the site is the Articles section, which addresses key questions to which feedback is encouraged. Better still, if you would like to submit an article for publication on this site, then please contact the web site manager by visiting the contact page. Case studies describing the problems associated with corruption, and/or practical ways of reducing its reach, are particularly welcome.

RSS facilities are provided, to allow registered visitors to choose to be informed when new content is posted that is of interest to them.Further information is provided in the Frequently Asked Questions section.

Statements of Support

Following a short pilot phase, and the establishment of a small working group to take the initiative forward, this web site was launched on 9th December 2005. If you represent an organisation with views on the objectives, ideas or processes described in this site, then we would like to hear from you. You can contact us either through comments posted in response to the various articles, or through the contact page. You are also encouraged to submit additional articles on related topics. “Abair ach beagan is abair gu math e”

Statements of support already received include:

Transparency International (UK)
“Transparency International (UK) welcomes the “Ethical Edinburgh” initiative. The external verification of anti-corruption procedures, the accreditation of independent assessors, and the maintenance of associated databases are each expected to become increasingly important if sustained progess is to be made in curbing corruption in international construction and infrastructure projects”.
Neill Stansbury, Director of Construction and Engineering, TI (UK)

Clare Short, MP. Former UK Secretary of State for International Development.
“I can only congratulate you on the work you are doing and wish you well with it”.

Engineers Against Poverty
“Engineers Against Poverty strongly welcomes the establishment of Ethical Edinburgh and looks forward to working closely with it. As this year’s Global Corruption Report highlighted, the cost of corruption is immense and it pervades all levels of the construction sector and involves rich and poor countries alike. It encourages bad decision making, distorts markets, increases the risks and costs of doing business and undermines business and public confidence in efforts to fight poverty. Developing practical and effective sector specific anti-corruption policies and tools should be a priority for everyone working in the sector”.
Petter Matthews, Executive Director, Engineers Against Poverty.

UK Anti-Corruption Forum
“The Anti-Corruption Forum welcomes the launch of the International Centre for Transparency in Construction, in that the ICTC plans to develop and put into practice several of the Forum’s key objectives contained in the Anti-Corruption Action Statement. The UK Anti-Corruption Forum is an alliance of business associations, professional institutions and companies with interests in the domestic and international infrastructure, construction and engineering sectors. It was founded in October 2004 by the Association for Consultancy and Engineering (ACE), British Consultants and Construction Bureau (BCCB), Institution of Civil Engineers (ICE), Institution of Structural Engineers (IStructE), Transparency International (UK) (TI(UK)), and several representatives of the business community.”

Simon Done, TRL Ltd
“Corruption is one of those issues which it is necessary to largely eliminate if development funds, whether internal or external, are to achieve anything remotely approaching their potential.”.

Shuva Sharma, Kathmandu, Nepal
“This is a great initiative and I fully support it. Please continue to move to realise your objectives which can only help the poor of this world.”

Engineering without Frontiers, Institution of Civil Engineers.
“Engineering without Frontiers welcomes the development of Ethical Edinburgh as part of the essential drive to reduce corruption in infrastructure projects and the damage this causes to development.”.
Professor Paul Jowitt, Chair of Engineering without Frontiers.