HOW TO BENEFIT FROM PPPs TO STRENGTHEN MUTUAL ANTI-CORRUPTION COMPLIANCE
Private-Public Collective Initiatives....
2nd Forum on Anti-Corruption
West Africa Edition
18 – 19 June 2013
Lagos, Nigeria
Contents
Contents
Relevance of PPPs in driving Internal and External Compliance
The PPP Scorecard - how effective have these been and why?
PPPs Solutions that Work
Close
Why the PPP Route? Traditionally, PPPs are profit-making
collaboration between public agencies or government bodies at any level and private companies.
It’s been successfully used to improve public utilities and infrastructure - railways, bridges, airlines, schools, hospitals, road networks e.g. Lekki Toll expressway,
Win-win: private sector makes money; government trades bureaucracy with efficiency
The question is how have we applied the concept of PPPs to
Anti- corruption efforts?
Via pacts, agreements, “social
contracts”, joint actions, MOUs
(i) between governments and para-governmental agencies e.g. UN - UNCAC
(ii) between governments and private companies – Cameroon and Ghana model
Investigating private
complaints and prosecuting where necessary
Local anti-corruption enforcement agencies
Internal and External- facing Compliance...
INTERNAL TO THE BUSINESS E.G. ADHERENCE TO
• gifts, travel and entertainment limits,
• conflicts of interest,
• segregation of authorities,
• approval limits,
• Due diligence and background checks
• anti-trust best practices
• entertainment limits, conflicts of interest, segregation of authorities, approval limits, anti-trust best practices
EXTERNAL TO THE BUSINESS E.G. ADHERENCE TO –
• Processing licenses, permits and approvals
• Legislative lobbying
• Participation at congressional hearings
• Taxes and levies
• Fines and penalties
This distinction is well-appreciated in the UK Bribery Act which recognises
bribery simplicita and bribery of government officials
Have Public- Private Partnerships Worked?
What impact have they had in shaping our markets and communities?
The Scorecard... *Country 2012 World
Ranking
2011 World
Ranking
Improvement
/Decline
2012
score
2011
score
Benin
Republic
94 100 +16 36 3
Cameroon 144 134 -10 26 2.9
Cote d’Ivoire 130 168 +38 29 2
Ghana 64 69 +5 45 3.9
Liberia 75 91 +16 41 3.2
Gambia 105 77 -28 34 3.5
Nigeria 139 143 +4 27 2.4
Senegal 94 112 +18 36 2.9
Sierra Leone 123 134 +11 31 2.5
Togo 128 143 +15 30 2.4
Most countries did not progress out of the bottom half scoring less than 50 out of 100 (in 2012) and (less than 5 out of 10 in 2011).
Ghana remains the least perceived corrupt country in the sub-region, while Cameroon is perceived as the most corrupt country in West Africa , closely followed by Nigeria
Most of these countries have anti-corruption government agencies and laws
* Source: Transparency International Corruption Perception Index
The real problem is where does Public - Private interest intersect?
Need arises
(license, contract, approval)
Private sector
submits applicatio
n
Public sector
accepts application
Public sector
reviews application
Public sector
approves or denies
application
Public sector
monitors implemen
tation
Public sector
discovers breach
Public sector hands down
sanction
Periodic reviews
Enter the usual “Governance” challenges...
Lack of political will
Partisan politics
No culture of openness & transparency
Cultural sensitivities
Perceived “soft-landing” punitive measures
Selective enforcement and accountability
Implementation of ideas not controls
End result has been institutionalised corruption: strong demand driving forced supply
Understanding the Key Stakeholders in this Corruption Equilibrium
Demand Supply
Govt – Legislators, Judiciary, Executive
Media
Donor agencies, Diplomatic corps
Private sector, foreign investors
A Case for Internal controls not ideas... BORROWING FROM PRIVATE-RUN INSTITUTIONS AND
TRANSPOSING INTO PUBLIC TRANSACTIONS...
Strong conflict of interest mechanisms
Systemic checks and balances
Performance management & reward
structure
Transparency in gifts, travel and
entertainment
Whistleblower platform
Stakeholder management
Moving from paternalistic to
entrepreneurial
Private Sector Controls to prevent bribery
Controls around gifts, travel and entertainment
Strong whistleblower platforms
Conflict of interest limits and declaration
Clarity in charges
Proper recording of financial transactions
Electronic payments
Reporting mechanisms and consequence management
The “Sunshine Principle”
Complexity reduction
Declaration of assets
Cashless transactions
Standard, gazetted charges
Public official Identification
aids
Receipts and recording of
payments
Media awareness &
communication
Some actions and initiatives pursued by governments to eliminate
harassments, requests for arbitrary payments and bribe requests
Typical Public Sector Controls to prevent bribery
To embed a culture of Zero tolerance of Corruption & Bribery, let’s
borrow from the typical brand consumer disposition funnel...
AWARENESS
TRIAL REPERTOIRE
LOYALTY
Organisational
leadership & culture Standards &
Procedures
Training &
Communications
Enforcement &
Incentives
Due care in
delegating authority
Monitoring,
auditing & reporting
Response & continuous
improvement
• Tone from the Top
• Compliance and
Controls structure (FTE
and non-FTEs)
• Incorporating
compliance objs into
coy-wide objs
• Internal policies,
procedures and
SOPs
• Mandatory trainings
• Trainings deep diving into
high risk areas
• Innovative communications
e.g. Internal newsletters,
weekly tips, branded items
• 3rd Party due diligence
• Extending mandatory
trainings to key 3rd
parties
• Annual compliance
certification for key 3rd
parties
• Enhanced whistleblower
reporting platforms
• Backend and front-end
monitoring/compliance
reviews
• Robust breach
management processes
• Feedback employee
compliance surveys
• Annual certifications
(internal & external)
• Robust consequence
mgmt protocols
• Incentives (internal and
external) e.g. Awards,
acknowled-gements,
endorsements
Essential elements of a Corporate Compliance programme
Organisations whether, public or private, should strive towards moving from awareness to repetoire/embedding these pillars in their Compliance programme
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