Category Archives: Global

Armenian Businesses Commit to Compliance

31 Thursday Jan 2019

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Photo credit: Armenian Lawyer’s Association

This blog originally appeared on the FCPA Blog, linked here.

By Natalia Otel Belan and Yulia Glubokaya, respectively the regional director for Europe and Eurasia at the Center for International Private Enterprise (CIPE) and the deputy director for compliance at VimpelCom Russia.

Small and medium enterprises (SMEs) in emerging markets in Eurasia must demonstrate the ability to assess and mitigate corruption risks in order to do business with multinational firms. The vast majority of SMEs in the region are unable to do so. While corruption risks remain high, these firms are unable to access opportunities for growth. Until recently, Armenia was a case in point.

As discussed here by our colleague Katya Lysova, Armenia now has significant political momentum to fight corruption and the business community wants to do the “right thing.” To support this extraordinary opening, CIPE has recently launched an anti-corruption compliance program for the Armenian business community.  Read More...

The Price We Pay: What Does Corruption Cost?

29 Tuesday Jan 2019

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Photo credit: CIPE

By Caroline Elkin, Program Assistant with CIPE’s Europe and Eurasia team.

On December 5, CIPE hosted the Private Sector Collective Action to Counter Corruption Summit in Kyiv, Ukraine. The event gathered participants from business, government, civil society, and international organizations, representing Armenia, Kazakhstan, Moldova, Nigeria, Thailand, Turkey, Ukraine, and the United States, among others. This is the second in a series of blogs based on the summit. 

In the past ten years, the OECD, World Bank, IMF, Transparency International and leading scholars have published dozens of empirical studies showing how corruption, in its different shapes and forms, negatively affect every economic parameter. Worldwide, all citizens – not just businesspeople – are subject to a “corruption tariff” that makes buying and selling goods and services more expensive.

How do you measure the effects of that tariff? Numerous studies and investigative reports have revealed the financial value of bribes paid within a specific sector or infrastructure project.  Read More...

Building Foundations: Countering Corruption in Difficult Environments

18 Friday Jan 2019

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Photo credit: CIPE

By Caroline Elkin, Program Assistant with CIPE’s Europe and Eurasia team.

On December 5, CIPE hosted the Private Sector Collective Action to Counter Corruption Summit in Kyiv, Ukraine. The event gathered participants from business, government, civil society, and international organizations, representing Armenia, Kazakhstan, Moldova, Nigeria, Thailand, Turkey, Ukraine, and the United States, among others. This is the first in a series of blogs based on the summit. 

When you think of an anti-corruption activist, what comes to mind? Perhaps it’s someone you follow on Twitter, or a civil society organization that focuses on unearthing politicians’ corrupt acts.

These figures make real contributions to the fight against corruption. They attract public attention within their own country and from abroad. They push the envelope by challenging political elites. But in countries at war, with repressive regimes, undergoing post-conflict reconstruction, or undergoing financial crises, it is nearly impossible for individual activists acting alone to achieve change.  Read More...

Notes from Copenhagen

09 Wednesday Jan 2019

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Plenary session at the 18th International Anti-Corruption Conference, Copenhagen, Denmark, October 22-24, 2018. Photo Credit: Carmen Stanila

By Carmen Stanila, a Senior Consultant for CIPE based in Bucharest

It is the largest, most diverse gathering of anti-corruption advocates, experts, funders, and practitioners in the world. The latest edition of the International Anti-Corruption Conference (IACC) gathered over 1,800 people from 144 countries in Copenhagen. Three days of uplifting plenary sessions, results-oriented breakout sessions, and countless peer-to-peer exchanges made for an intense atmosphere at the dynamic October event attended by this writer and two CIPE staffers.

The 18th IACC’s declaration captured the priorities of a group that ranged from top government officials from wealthy nations to anti-corruption activists from some of the most corrupt, dangerous places in the world. Entitled “Stand Together for Peace, Security and Development,” the declaration calls for protecting civil liberties and civil society, combatting money laundering and illegal financial flows, boosting private sector transparency, and empowering those who expose corruption.  Read More...

Five Lessons from Compliance Training for Non-Profits in South Africa

13 Thursday Dec 2018

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Photo Credit: Wybrand Ganzevoort

By Wybrand Ganzevoort of Collective Value Creation and Gail Styger of The Wot If? Trust

In October 2018, Collective Value Creation (CVC), an organization that trains and coaches businesses, teamed with CIPE to train South African non-profit organizations on how to reduce corruption risks.

Over the past ten years, South Africa’s rank on Transparency International’s Corruption Perception Index has deteriorated from 51 to 78. During this time, a number of corruption scandals dominated public discourse, underscoring how corruption is a growing challenge in South Africa. In this environment, CVC and CIPE have often worked with small and medium-sized enterprises (SMEs) to help them reduce their corruption-related risks. What made October’s training different was that it focused on non-profits, an often-overlooked group when it comes to corruption risks. Through the training CVC and CIPE learned five key lessons about the corruption challenges faced by such groups in South Africa.  Read More...

G20 Summit: Finding Solutions to Corruption

07 Friday Dec 2018

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Photo Credit: G20 Argentina 

By John Zemko, Regional Director of CIPE’s Latin America and Caribbean Department

World leaders gathered recently in Buenos Aires, Argentina for G20 meetings intended to center around a theme of “Building Consensus for Fair and Sustainable Development.” The host country President Mauricio Macri has put fighting corruption at the core of his agenda.

It is not difficult to understand why. Bribery scandals in Argentina involving the Odebrecht conglomerate and other big companies have put a global spotlight on what can occur between venal public officials on the demand side of the corruption equation and public companies generating revenue streams on the supply side of the equation.

Nowhere is the risk of corruption clearer than in the management of state-owned enterprises. State-owned enterprises (SOEs) form a fifth of the world’s largest companies, often in strategic sectors such as natural resources, public utilities, and finance. Meanwhile, the Organisation for Economic Co-operation and Development’s (OECD) most recent Foreign Bribery Report states that over 80 percent of total pay-offs were either promised, offered or given to state-owned enterprise officials.  Read More...

Cliché and Complexity in Kyrgyzstan

19 Monday Nov 2018

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Bishkek Power Plant. Photo Credit: Danil Usmanov

By Caroline Elkin, Program Assistant with CIPE’s Europe and Eurasia team.

There are trite ways to describe almost every post-Soviet country: Belarus is Europe’s last dictatorship and Kazakhstan suggests Borat. Kyrgyzstan, sometimes called the island of democracy in Central Asia, appears luckier.

In reality, Kyrgyzstan’s cliché camouflages the overwhelming challenge of corruption, which 95 percent of citizens consider a major problem today. A growing scandal illustrates the extent of corruption in the country, and the challenges of combatting corruption in what, is at best, a flawed democracy.

President Sooronbai Jeenbekov, elected October 2017 in a flawed but somewhat competitive contest, has fired or brought corruption charges against high-ranking associates of his immediate predecessor, Almazbek Atambayev. Many of these stem from the scandal surrounding a badly repaired Bishkek thermal power plant, which broke during a cold snap in January 2018. That left nearly a quarter million residents of the capital without heat for several days in -16° Fahrenheit weather.  Read More...

Understanding Peru’s New Compliance Program Reform of Law

08 Thursday Nov 2018

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Photo Credit: Radio Nacional

By Facundo Galeano, a Legal Fellow with CIPE’s Anti-Corruption and Governance Center

On July 1, 2017, Peruvian law n. 30.424 came into effect. It regulates the administrative responsibility of legal entities for the offence of transnational active bribery. In article 17.1, the law establishes that legal entities can be exempt from liability of the crimes if, prior to the commission of the crime, a compliance program is adopted and implemented in the organization. This new law is intended to help businesses reduce corruption related risks.

According to the new law, a compliance program must appropriately fit an organization’s nature, risks, needs, and characteristics, consisting of appropriate surveillance and control measures to prevent such crimes or to significantly reduce the risk of their commission. Article 17.2 lists all the minimum requirements needed for compliance programs and states that the requirements of the compliance program will be developed in the law’s regulation.  Read More...

Colombia’s Corruption Conundrum

01 Thursday Nov 2018

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Photo Credit: Omar Vera

By Victoria Tellechea-Rotta, a Program Assistant with CIPE’s Latin America and the Caribbean team. 

Across Latin America in the past few years, governments, politicians, and businesses have been implicated in corruption scandals. These scandals range from local to multinational, from kickbacks to embezzlement and fraud. Corruption and how to best mitigate it, became a central issue in the wave of executive and legislative elections in Latin America in 2018. Colombia’s recent presidential elections were no exception. Colombia ranks 96th (out of 180) in transparency in Transparency International’s Corruption Perception Index, and scores a 37 (out of 100) in their perceived level of public corruption. On the campaign trail, candidates touted their proposals to eradicate corruption. The eventual winner of the election, President Ivan Duque, ran on a platform of campaign finance reform and budget transparency.

Despite his campaign promises, Duque’s credibility when it comes to combating corruption in Colombia, which recently experienced one of the bloodiest civil wars in Latin America, has been put into question.  Read More...

Corrosive Capital and Strong Economies: The Case of Israel

26 Friday Oct 2018

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Source: CIPE

By Liad Roytfarb, a fellow with CIPE’s Anti-Corruption and Governance Center

In September 2018, a CIPE conference highlighted the growing concern over corrosive capital. Corrosive capital is state-driven capital transmitted from authoritarian countries to different parts of the world that can have negative effects on democratic institutions and private enterprise. CIPE and the international community are mainly concerned about the effect of corrosive capital on developing and emerging countries. These countries are more susceptible to corrosive capital because they need financing and often have fragile democratic institutions and governance gaps. The growing desire of China and Russia for geopolitical power and the fragility of democratic institutions worldwide make it important for individual countries and international organizations to think strategically about the influences of foreign capital. They should scope the problem, understand the risks associated with different capital flows, and work to ensure that proper safeguards are implemented to mitigate the negative effects of corrosive capital.  Read More...