Maravi

It's business' business to fight corruption

It's business' business to fight corruption
By Editor
Friday April 11, 2008 [04:00]

There is a strong business case for having an anti-corruption strategy. And the initiative by the Zambia Business Forum to partner with the Anti-Corruption Commission in the fight against corruption is a recognition of business’ vulnerability to corruption and of the benefits of effective anti-corruption programmes and controls. Companies are losing real and significant business opportunities because of corruption risks.

There are many companies that have not entered a specific market or business line or pursued a particular opportunity because of corruption. Therefore, a better understanding of corruption will help them compete more effectively, make better decisions, improve corporate social responsibility and enter new markets and business lines.

It would not be wise for business to sit ndwii hoping things will improve by themselves when they are losing bids everyday because of corruption. A level playing field is crucial to their company’s future business activities. And that level playing field will not come by itself, it has to be struggled for and it is their duty to struggle for it.

There is need for the business community to join hands with other forces in the nation and make corruption too expensive for those who risk to undertake it. The risk to reputation or brand damage from corruption must be raised and made crippling.

Having an anti-corruption programme in place and publicising it should be seen as valuable or very valuable to a company’s brand. There must be severe impact on corporate reputation for those who involve themselves in corrupt activities.

What worries us is that despite being aware of corruption, many companies’ underlying policies and controls currently do little to identify and deal with this problem. It is therefore very pleasing to learn that the Zambia Business Forum is partnering with the Anti-Corruption Commission to promote ethical dealings in both business and government and help create a corruption-free Zambia.

We welcome the Zambia Business Forum initiative because while there appears to be a firm commitment to tackling corruption, companies need to do more to protect themselves from this scourge. There is a gap between corruption risks and companies’ anti-corruption initiatives as well as efforts to remedy it.

Business is more keenly aware than ever of the dangers of corruption. Yet, companies still need to expand the scope and rigour of their efforts to manage corruption risks with well-designed controls that are clearly communicated and enforced.

By looking at the frequency of various types of bribes, the yearly share of revenues paid in bribes, and the views of business regarding the extent to which corruption impairs its performance, we can begin to discern what is holding back investment that could spur higher growth.

Clearly, corruption – whether measured by the frequency of bribes, or the extent to which corruption is an obstacle to business – is a challenge that we all need to collectively confront as a nation.

And there is no doubt that better policies, institutions and alliances can help reduce corruption over the medium-term.

There is need for us as a nation to continue to undertake policy and institutional reforms that are targeted at significantly changing the rules of the game. But better policies are not the only determining factor. Everything possible should be done to improve the business environment.

As we try to undertake these policy and institutional reforms, we shouldn’t also forget that corruption comes in many forms; one of the most pernicious of which is state capture.

State capture involves bribes paid to influence the content of laws and regulations, that is, the fundamental rules of the game, rather than simply their implementation in individual instances.

And we shouldn’t lose sight of the fact that state capture can change from being a strategy of political influence practiced by a small share of firms to a more widespread practice.

And increased competition among captor firms may actually be making its impact on the business community more diffuse.A lot of things about our attitudes towards corruption also need to change.

Notwithstanding the clear condemnation of corruption, the exposure of corrupt acts is clearly not rooted within our enterprises. We so often encounter corrupt practices and do nothing about them.

This has to change. There are risks in fighting corruption and we should all share those risks. This fight cannot be left to a few individuals, companies or institutions. It requires the participation of every individual, company and institution.

The phenomenon of corruption has negative effects on the country’s economic life in so far as creating a business environment characterised by uncertainty, may be a strong disincentive for investment, both local and foreign. On the other hand, its impact is differentiated in terms of direct costs to enterprise and households.

Corruption is certainly, or evidently, one of the obstacles that must be taken into consideration when formulating any kind of poverty reduction policy in this country.

It is for these reasons that we highly welcome the move by the Zambia Business Forum to take corruption seriously by embarking on concrete measures to combat it. Corruption is a cancer that should be fought with all the tenacity we can marshal.

If we don’t make progress in fighting corruption, we will not make much progress in the efforts to grow our businesses and in the general development of our country.

There is truly a strong business case for business to join in the fight against corruption. It’s business’ business to fight corruption.

Labels: BUSINESS, CORRUPTION

posted by MrK @ 3:23 AM