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Slide 1 - The Role of Transparency International in Fighting Corruption in Infrastructure by Donal O’ Leary Senior Advisor Transparency International Berlin, Germany Prepared for ANNUAL BANK CONFERENCE ON DEVELOPMENT ECONOMICS, TOKYO, MAY 29-30, 2006
Slide 2 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 2 OUTLINE OF PRESENTATION INTRODUCTION TO TRANSPARENCY INTERNATIONAL SOURCES OF CORRUPTION IN INFRASTRUCTURE (‘GRAND’ AND ‘PETTY’) INSTRUMENTS FOR ADDRESSING ‘GRAND’ CORRUPTION INSTRUMENTS FOR ADDRESSING ‘PETTY’ CORRUPTION THE WATER INTEGRITY NETWORK (WIN): SETTING UP A COALITION TO COMBAT CORRUPTION ISSUES
Slide 3 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 3 INTRODUCTION TO TRANSPARENCY INTERNATIONAL INTERNATIONAL NGO FOUNDED IN BERLIN IN 1993 IS A GLOBAL NETWORK INCLUDING MORE THAN 90 LOCALLY ESTABLISHED NATIONAL CHAPTERS AND CHAPTERS-IN-FORMATION THE CHAPTERS BRING TOGETHER RELEVANT PLAYERS FROM GOVERNMENT, CIVIL SOCIETY, BUSINESS AND THE MEDIA TO PROMOTE TRANSPARENCY IN ELECTIONS. IN PUBLIC ADMINISTRATION, IN PROCUREMENT AND IN BUSINESS CHAPTERS ALSO SUPPORT ADVOCACY CAMPAIGNS AGAINST ANTI-CORRUPTION POLITICALLY NON-PARTISAN, TI DOES NOT UNDERTAKE INVESTIGATIONS OF ALLEGED CORRUPTION OR EXPOSE INDIVIDUAL CAUSES
Slide 4 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 4 Exhibit 1. How Does Corruption Happen in Infrastructure Projects ? Contracting Decision Contracting Process/Bid Evaluation Contract Implementation Contract design
Slide 5 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 5 Exhibit 1. How Does Corruption Happen in Infrastructure Projects ? Contracting Decision Contracting Process/Bid Evaluation Contract Implementation Unnecessary Tagged Conflicts of interest Contract design Tagged Over-designed, Under-designed Documents are confusing Decision makers are biased Selection procedures are non-transparent, or not objective Clarifications are not shared with other bidders Confidentiality during the process Award decisions are not made public or are not justified Poor quality, defective, specifications Contract renegotiation Claim non-existent damages Supervisors are biased
Slide 6 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 6 ‘PETTY’ CORRUPTION IN INFRASTRUCTURE PROJECTS ILLEGAL CONNECTIONS FALSE METER READINGS INCOMPLETE/TARDY BILLING INCOMPLETE/TARDY COLLECTIONS UNDULY HIGH CONNECTION CHARGES (LEADING TO ‘UNAUTHORIZED’ CONNECTIONS) IN SUM, ‘PETTY’ CORRUPTION CAN ACCOUNT FOR 20% OR MORE OF SYTEM LOSSES IN POWER OR WATER DISTRIBUTION NETWORKS.
Slide 7 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 7 INSTRUMENTS FOR ADDRESSING ‘GRAND’ CORRUPTION INTERNATIONAL NATIONAL INTEGRITY SYSTEMS INTEGRITY PACTS BUSINESS PRINCIPLES FOR COUNTERING BRIBERY
Slide 8 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 8 INTERNATIONAL INSTRUMENTS FOR ADDRESSING ‘GRAND’ CORRUPTION UN Convention Against Corruption OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions NEED FOR CONSTANT MONITORING AND FOLLOW UP TO ASSURE THAT THESE AND OTHER CONVENTIONS ARE BEING ADHERED TO
Slide 9 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 9 NATIONAL INTEGRITY SYSTEMS Institutional Pillars for the National Integrity System Rules and Practices for the Institutional Pillars
Slide 10 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 10 Exhibit 2. Pillars of Integrity
Slide 11 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 11 Integrity Pacts Process Rights and Obligations Monitoring Sanctions
Slide 12 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 12 Business Principles for Countering Bribery (BPCB) The Business Principles state: The enterprise shall prohibit bribery in any form whether direct or indirect The enterprise shall commit to implementation of a Program to counter bribery. These principles are based on a commitment to fundamental values of integrity, transparency and accountability. Enterprises shall aim to create and maintain a trust-based and inclusive internal culture in which bribery is not tolerated.
Slide 13 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 13 Implementation of the BPCB A program is the entirety of an enterprise’s anti- bribery efforts including values, policies, processes, training and guidelines. The BPCB Program Implementation Requirements Implementation: The TI Six Step Process
Slide 14 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 14 BPCB – SUPPORTING TOOLS A Guidance Document provides background on each section of the Business Principles, explains how to implement each Principle, answers frequently asked questions and gives examples of corruption and of good practice. The TI Six-Step Implementation Process is a how-to guide for companies who wish to introduce an anti-bribery programme within their organization. This tool is also available as an interactive electronic module. TI is currently developing a Self-Evaluation Module to assist companies in assessing their anti-bribery performance, which can also serve as the basis for external verification.
Slide 15 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 15
Slide 16 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 16 INTERNATIONAL CORPORATE REPORTING INITIATIVES/INDICES USING THE BPCB FTSE4Good Index UN Global Compact Global Reporting Initiative World Economic Forum Partnering Against Corruption Initiative
Slide 17 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 17 SECTOR-WIDE ANTI-BRIBERY AGREEMENTS COVER THE WATER PLASTIC PIPE MANUFACTURING SECTOR FIRST AGREEMENT SIGNED IN COLOMBIA in April 2005 SECOND AGREEMENT SIGNED IN ARGENTINA in December 2005 FOLLOW UP AGREEMENTS ARE UNDER PREPARATION
Slide 18 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 18 INSTRUMENTS FOR ADDRESSING ‘PETTY’ CORRUPTION Management Contracts Benchmarking Business Principles for Countering Bribery Citizens’ Report Cards
Slide 19 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 19 THE WATER INTEGRITY NETWORK (WIN) OBJECTIVES SCOPE MEMBERSHIP ACTIVITIES NETWORK ORGANIZATION
Slide 20 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 20 WIN GOVERNANCE Chair and Steering Committee Elect Monitor Secretariat + Host organization (TI) Members/National groups Manage
Slide 21 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 21 WIN GOVERNANCE (Contd.) Decisions Taken at Interim Steering Committee Meeting, Berlin, May8/9, 2006 Chair Elected (Hakan Tropp, SIWI) TI Designated WIN Manager (Donal O’Leary) Work Program Prioritized and Endorsed Financing Strategy Agreed Launch at WWW, Stockholm, August, 2006
Slide 22 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 22 ISSUES Can Reformers Address Corruption on a Sector-Specific Basis? Can Reformers Develop Generic Sectoral Anti-corruption Tools? How do the Efforts of Civil Society Fit with the Efforts of Other Reformers? Example of the Integrity Pact
Slide 23 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 23 HOW CAN INTERNATIONAL STAKEHOLDERS SUPPORT ONGOING ANTICORRUPTION EFFORTS IN INFRASTRUCTURE? Vigorously Support Institutionalization and Enforcement of Existing International Anti-bribery Conventions                  Provide Financial Support for and Implement the Integrity Pact in their Own Organizations                   Support and Actively Participate, as Appropriate in Promoting the BPCB  Provide Financial Support and Participate in the WIN
Slide 24 - ABCDE Conference, Tokyo 2006: Infrastructure and Governance 24 THANK YOU FOR YOUR ATTENTION! Donal O‘Leary Senior Advisor Transparency International Alt Moabit 96 Berlín 10559, Germany Tel: (49) (0) 30 343820 30 Fax: (49) (0) 30-3470 3912 Email: doleary@transparency.org
 

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