News 20th Dec 2016

Corruption in 2017


Robert Barrington

Executive Director

Robert joined Transparency International UK in 2008 and was appointed as Executive Director in 2013. His areas of expertise include the Bribery Act integrity in the private sector and corruption within the UK. Recent projects and publications include ‘Anti-Bribery Due Diligence for Transactions’, ‘Adequate Procedures & Guidance to the UK Bribery Act’ and ‘Corruption in the UK’.

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As 2016 draws to a close, Robert Barrington looks at the state of the fight against corruption in the UK and around the world, with guest contributions from some well-known figures in the Transparency International movement.

2016 was a rollercoaster year in global politics and for the global economy.  Corruption was front and centre in many of those developments, helping to bring a new political order into being with a popular mandate to tackle many different – and possibly new – forms of corruption.  As we enter 2017, it is far from clear that those new to office will be willing or able to tackle the problems that put them there.

A year of two halves

It was a year of two halves.  We started with six months of optimism symbolised by the London Anti-Corruption Summit: a British Prime Minister taking a very visible global lead on corruption; a group of world leaders with more sense of commitment to this issue than ever before; 648 commitments from 43 countries.  The UK Government evinced pride in having re-gained a place in the top ten of TI’s Corruption Perceptions Index.

But then came the shocks.  The UK Brexit vote.  The surprise victory of Donald Trump.  Outliers like the Philippines’ Duterte shaking up the old order.  Voters around the world signalling through the ballot box and opinion polls that they don’t like the status quo yet often, ironically, supporting candidates whose rhetoric for change sometimes seemed at odds with their privileged backgrounds or moral conduct that in other years would have ruled them out of contention.

Where do we now stand?

In the UK, there is a government that has stated its commitment to tackling corruption – but Brexit dominates the political debate, and the publication of the UK’s first-ever Anti-Corruption Strategy, promised for December, has been delayed.  That need not matter if the resulting strategy is world class – but civil servants are starting to try and manage down expectations, which is not a good sign.

Elsewhere, corruption is undermining the legitimacy of governments across the continents. China’s leadership has continued its anti-corruption drive, but the campaign looks increasingly politicised, and the conditions for a successful long-term campaign don’t exist: a free press, civil society, uncensored social media, independent judiciary, etc.  Russia continues to depress everyone who values integrity in government. South Africa has had a year of contradictions – a tainted president but a creditable fight back from civil society.  Other long-running scandals like Malaysia’s 1MDB and the Bangladesh Bank remain unresolved.  But there is good news too.  Brazil continues to demonstrate one of the most widespread and effective anti-corruption drives of recent years.  And France has passed the ‘Loi Sapin II’, designed to tackle corruption and corporate bribe-paying.  Below are some TI views from around the world; and first, a quick summary of some of the uncertainties which face us in the anti-corruption community in the new  year.

The known unknowns

As we go into 2017, here are five big unknowns.  One thing we do know for certain is this: corruption will not be  going away.

1) The swamp. Conventional politics and political parties have proved an easy target for populist politicians precisely because they are so easily accused of being part of a swamp – with little real effort to control lobbying, the revolving door or political donations.  The system seems fixed in favour of the elite, which apparently includes more or less all existing politicians.  How deep is the swamp, and why are those who are part of the current political set up so reluctant to admit there are problems?

2) Truth takes a vacation. Being an evidence-based organisation in the post-truth era is not a comfortable place to be. It may not be long before those from civil society who aim to speak truth to power are written off as an elite whose words cannot be trusted.  At TI, our commitment to providing objective and independent research is out of step with current trends in politics and the media. The neglected art of dis-information has been revived with a vengeance, aided by social media, an unconfident or captured conventional media, and in some countries libel laws that prevent the truth being spoken.

3) Who’s the leader? We have moved in  six months from world leaders vying to take leadership on the issue of corruption to deep and awkward questions about whether any country will uphold global standards of any sort – on climate change, human rights, war crimes, and many other areas, quite apart from corruption.  The single most important factor in any fight against corruption is political will.  Who’s the leader?

4) The rise of populism. One of TI’s core values is democracy.  But what happens when people in unrigged elections vote for candidates (usually described as demagogues) who appear, at best, indifferent to corruption? So-called populist politicians have been winning elections and referendum votes, and riding high in the polls, making good use of anti-corruption rhetoric. What we don’t know is how their anti-corruption agenda will play out once they are in office.  Will Trump drain the swamp or will he prove to be part of it?  How will Duterte’s extra-judicial killings affect his country’s democratic institutions?  Will Britain’s High Court Judges continue to face intimidation from those who find they don’t quite like Britain’s law and constitution?

5) Powerful people don’t like TI. Of course, it’s not just TI, there is a widespread move by governments across the world to suppress civil society organisations like TI.  It’s no surprise to have it from China and Russia (where our colleagues are officially designated as ‘foreign agents’), but it has spread to many other countries.  There is a danger that ill-thought through actions by the UK Government like the notoriously poor Lobbying Act adds a spurious respectability to such moves. 2016 produced an upsurge in the repression of civil society: how far will it go in 2017?

Is this a new kind of corruption?

Populism, post-truth electioneering, sometimes highly authoritarian leaders, supported by electorates who want something different – these are common themes in the UK and beyond.  One consistent element is a popular reaction against corruption.  A host of issues clustered around inequality and injustice seem to feel corrupt to ordinary people: a political system run in the interests of a privileged few; tax abuse; a financial system that generates wealth but does not distribute it widely; the increasing provision of public services by private entities that seem to have the rules fixed in their favour while not serving the public interest.  Are these corruption?   Voters seem to think so. Some of these would not fall under traditional definitions of corruption, but perhaps we are seeing the world ’crowd-sourcing’ a new definition of corruption.  Meanwhile, recent events also open up the prospect of new forms of corruption like the manipulation of truth in the age of social media.  It remains to be seen whether the new political order has the will or ability to address these issues.

Where next?

Political turmoil brings unpredictable social and economic consequences.  It’s an opportunity for the unscrupulous to gather power and accumulate wealth.  The accountability of leaders may be weakened; the use of the apparatus of state to silence dissenters and manipulate public opinion may increase; truth will probably be an early victim. These are the ideal conditions for corruption to thrive.  I have spoken to many people in the past few months, from many different countries and many different political perspectives, who have said more or less the same thing: we are at risk of losing the gains of the past twenty-five years, and in the next few years Transparency International is going to be needed more than ever.  At TI-UK, we enter 2017 with a keen sense of the challenges ahead.


Nine views from around the world


“The fight against corruption ‘down under’ continues to crawl its way forwards. We’ve seen Australia decline further on TI’s CPI, indicating that public institutions have yet to show strength in combatting corruption. On the foreign bribery front, the Aussie ‘big stick’ legislation is looking more and more like a fragile twig in application with no successful convictions after 17 years waving that stick around. Thinking positively, Australia launched its first OGP National Action Plan – a plan with some great commitments and milestones.  Plenty for all stakeholders work with and for civil society to monitor over the next two years.”

Phil Newman, Executive Director of TI Australia


“As the multi-trillion dollar global scandal appear to claim increasing space in development and governance discourse internationally and nationally, the importance of multi-stakeholder involvement in fighting this menace is being emphasized more prominently. On the other hand, the prospect of working together against corruption is turning to be highly challenging in many parts of the world. Shrinking space for civil society is being institutionalized by legal provisions that curtail freedom of speech and opinion, in some cases like Bangladesh recently, intended to restrict the scope of raising views, voice and demand against corruption.

Will corruption control be mired by dissent control, which is apparently becoming ‘new global normal’? As attractive as it may appear in the short term, no government can keep on shooting the messenger by restricting critique and dissent for too long except for its own peril. Governments that restrict freedom of speech and opinion not only protect the corrupt but also in the ultimate analysis create the Frankenstein for themselves.”

Iftekhar Zaman, Executive Director of TI Bangladesh


“Winners of Transparency International’s Anticorruption Award 2016, the “Carwash” task-force is responsible for the largest corruption investigation ever conducted in Brazil and one of the largest in the world. With the collaboration of authorities in more than 30 jurisdictions, it has unveiled a bribing scheme of nearly USD 2 billion in Petrobras only (the probe is now reaching other Brazilian state owned enterprises). It is already considered a watershed in the country’s history of impunity, with more than 240 criminal charges and 118 convictions – summing up 1,256 years of sentence time. Most of the defendants so far are executives and business tycoons, but in 2017 the operation will enter a new stage focusing on the political class. With the collaboration of several companies through leniency agreements, it is expected that more than 200 MPs will be targeted. The risk of deepening the political and institutional crisis is real.”

Bruno Brandao, Executive Director of TI Brazil


“In Canada, the fight against corruption and for greater transparency continued to gain momentum, as the media focused heavily on political finance issues, ongoing prosecutions under the Corruption of Foreign Public Officials Act, the implementation of recommendations from a major commission of inquiry into corruption and collusion in the construction industry and, of course, Canadian connections to the Panama and Luxemburg Papers. TI Canada fueled this momentum with an array of projects, publications, events and advocacy initiatives, including the publication of a major report on the absence of beneficial ownership transparency in corporations and trusts, the publications of a research paper on compensation for victims of corruption, multiple seminars on anti-corruption compliance and related topics, the initiation of the Canadian component of the Mining for Sustainable Development Initiative and multiple other activities. TI Canada looks forward to continuing to press Canadian governments and industry to do more to fight corruption both domestically and internationally in 2017.”

Paul Lalonde, Chair of TI Canada


“The French legislation recently improved on various anti-corruption issues including three particularly important topics which are prevention of conflicts of interest in the public sector, whistleblower protection and prosecution of foreign bribery. TI France is currently urging the candidates to the next presidential election to continue those efforts in order to address remaining priorities such as the independence of the judiciary. We believe those efforts are of great importance to address the crisis of citizen trust that most of the western democracies including France are currently facing.”

Julien Coll, Executive Director, TI France


“Despite the improvements made in the public sector, the fight against corruption in Indonesia is becoming even more challenging due to the tendency for political considerations and economic expediency to be the government priority.  For this reason, it is important for us to continue to be vigilant and to not lose sight of the objective,  namely to ensure sustainable and equitable economic growth through clean government.”

Natalia Soebagjo, Chair of TI Indonesia


“On a global level of course the Panama papers case has catalysed a number of initiatives on beneficiary ownership disclosure, bringing anti-money laundering and anti-corruption initiatives closer to each other. I suspect that this will result in unprecedented opportunities to track proceeds of grand corruption and thus reduce incentives for corrupt behaviour globally.

In Russia, the FSB has become extremely active in arresting public officials, including a minister, a governor, number of heads of departments from various public agencies, accusing them of bribe extortion, money laundering and fraud. Speaking about legal framework, initiatives on disclosure of beneficiary ownership and whistleblower protection remain dormant. Rule of law remains very weak, with civil society activists being pursued for criticism of the government, private sector lacking protection of property rights, and media – being revenged for audacious publications against Putin’s old friends and allies. Although the ability to change the environment in the country as a whole remains very limited, there are new sources of information and tools for NGOs, media and civil society to unmask and name certain corrupt individuals.”

Anton Pominov, Executive Director of TI Russia

South Africa

“Although the end of 2016 is witnessing a growing volume of reports of grand corruption, with President Zuma at the centre of many of the reports, the anti-corruption forces are in an infinitely stronger position now than they were at the beginning of the year – more whistleblowers are coming forward; important people and institutions in the public and private sectors are stepping up to the plate; parliament, hitherto a handmaiden of the executive, is showing distinct signs of life; and there is even increasing dissent in the ranks of the ruling party inspired by opposition to the corrupt conduct of the party leadership.  These developments are all down to the pressure exerted by Corruption Watch and other civil society organisations and a robust, independent media.  So we end the year tired, but encouraged and ready to re-enter the fray when the new year opens.”

David Lewis, Executive Director of Corruption Watch, the TI chapter in South Africa

United Kingdom

“The London Summit put the issue of corruption centre-stage, and also the presence of the proceeds of corruption here in the UK. New legislation, including Unexplained Wealth Orders, should increase the recovery of illicit assets, and ultimately their return to benefit the people from whom they were stolen. However to achieve this, law enforcement needs the independence and resources to pursue cases and information from the promised register of the true owners of British real estate held in the names of overseas companies.”

“If 2016 is remembered as the West’s year of political disruption, 2017 will be the year we had to make sense of it. The result of June’s referendum on Britain’s membership of the European Union, and more recently the election of a political outsider and maverick businessman as the new U.S. President, pose the same question: why did so many feel the way things are run doesn’t work for them?”

Duncan Hames, Director of Policy, TI-UK


image: Cope