Category: Corruption

How to create a robust Anti-Corruption Framework (Part 1)

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Corruption - Picture of ace of spades playing cardIs your corruption prevention program going to deal you a winning hand, or will it collapse like a house of cards?  In today’s increasingly complex global environment, it’s no longer a question of whether an organisation has an anti-corruption framework in place, but how robust that framework actually is.  Corruption prevention and compliance programmes that fail to stand up to scrutiny when stress-tested, can have significant and far-reaching consequences.

In Part 1 of this two-part series, I’ll outline the essential building blocks that should be included in an effective anti-corruption framework.

How a failure to prevent corruption by employees led to a US$772 million penalty

While the resources needed to develop a robust corruption prevention framework may seem significant, the financial risks of not investing are even higher.  First and foremost are the direct financial and reputational losses caused by the act itself. This is highlighted by the ACFE’s annual global fraud surveys, which consistently estimate that the typical organisation loses 5% of its annual revenue to fraud alone. More

Corruption is perverting NGO missions – but are its leaders up to the challenge?

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Photo of Hands-up to stop corruptionAccording to the UNDP, funds lost to corruption in the Global South are 10 times the amount of official development assistance (ODA), while the World Bank estimates that each year between 20% and 40% of ODA itself is “stolen” by public officials.  It does not end here though, as its pervasiveness and magnitude –  when combined with the risks inherent to the non-profit sector – has now reached the point where corruption is perverting NGO’s missions.  At stake here is the accountability and credibility of the sector as a whole.  But are its leaders up to the challenge?

Acknowledging the elephant in the room

A simple litmus test for this is to ask an NGO’s leadership the following question: ‘Is corruption a problem within your organisation?’  In a 2014 survey of Australian and New Zealand NGOs, while 90% felt that corruption was a problem for the sector, 72% (or three out of four) stated that it was not an issue for their organisations.  In other words, while it was a problem, it wasn’t theirs, but someone else’s! So if most non-profit leaders don’t see corruption as an issue, why should their staff? More

The 10 Most Corrupt World Leaders of Recent History

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Filed under 'corruption' - PictureRead any article on corruption prevention, and the first thing you’ll be told is that ‘political will’, or the tone at the top, is the foundation of any successful anti-corruption effort.  But what if a country’s leader, whose ethics and integrity should be beyond question, isn’t as principled as they should be?  True to the old adage that ‘absolute power corrupts absolutely’, we have compiled a list of the ten most corrupt world leaders of recent history.

Proof that corruption is truly a global issue, the list de-bunks the myth that cases of grand corruption (and kleptocratic regimes responsible for it), are limited to certain parts of the world.  Of the ten world leaders who made the list: three are from Africa, three from the America’s, two from Asia, and two are from Europe. More

For the Love of the Game: Corruption and Sports NGOs

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Photo - Sports NGOs & Corruption Sport is now the dominating source of entertainment worldwide. Just under the surface though, is a darker, shadier world where corruption (usually in the form of bribery, match-fixing, extortion, doping and money laundering) is common place.  Sports NGOs are particularly vulnerable to these activities, with this article exploring why – and what can be done about it – in more detail.

Sports NGOs and ‘Corruption as usual’

It seems that barely a month passes without yet another report of corruption in sports being splashed across newspaper headlines. In relation to large sports NGOs, these have included: members of FIFA’s executive committee accepting bribes, a former president of CONCACAF being charged with fraud and money laundering, hosting nations paying bribes to win Olympic hosting rights, match-fixing, and the IAAF’s involvement in corruption and cover ups. More

Why Anti-Corruption Programmes Fail

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Photo of drowning person - Why Anti-Corruption Programmes FailCurrently estimated to cost five per cent of the world’s total GDP, or US$2.6 trillion per annum, corruption is now the third largest industry globally and is growing. In response, anti-corruption legislation around the world is being strengthened, with a growing emphasis now placed on enforcement and compliance. Organisations not only need to have an anti-corruption programme in place, but are increasingly required to prove its effectiveness.

The following article was originally published in Ethical Boardroom Magazine Winter 2016 Edition.

Eight mistakes that boards & management need to be aware of when establishing anti-corruption programmes

Unfortunately, a growing number of anti-corruption programmes are failing to meet this new challenge; the most recent being the French industrial group Alstom. Despite having an integrity and anti-corruption programme in place, Alstom was recently fined US$277.3 million to resolve criminal charges relating to a widespread corruption scheme. The scheme involved the payment of at least US$75 million in secret bribes to government officials around the world.

So what went wrong? Why was it that its anti-corruption programme failed and failed so miserably? While there is no silver bullet to guarantee success, there are a number of common pitfalls, which, if avoided, can dramatically decrease the chance of failure.

While not exhaustive, outlined below are the most common mistakes that boards and management need to be aware of when establishing anti-corruption programmes. More

10 corruption risks keeping charities / NGOs awake at night

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Photo of man sleepless over corruptionWorking for a charity or NGO? Getting enough sleep at night? If you’ve answered ‘yes’ to both these questions, then you should be asking yourself how much you really know about corruption risks within the non-profit sector.

The following article was subsequently published by Pro bono Australia.  Titled ’10 Corruption Risks Keeping NFPs awake at night’, it appeared in their Hot Topics section on 15 October 2015.

While Charities are the most trusted institutions in the world …

I’m always surprised when talking with people working in the charity/NGO sectors, at how little many of them know about the inherent corruption risks facing their industry.  While consistently ranked as the most trusted institutions’ globally (topping the Edelman Trust Barometer for the last seven years in a row), the sector faces a number of inherent vulnerabilities that significantly raises its overall corruption risk ranking.  Having a knowledge of these is essential if a charity/NGO is to put an appropriate risk mitigation strategy in place. More