18th International Anti-Corruption Conference

Corruption is a major development challenge. It impacts all five pillars of the 2030 Agenda for Sustainable Development – people, prosperity, planet, peace, and partnerships. It is a significant bottleneck to achieving sustainable development in all its three dimensions – economic, social, and environmental.
Every year the developing world loses more than US$1 trillion in illicit outflows[1] through government corruption, criminal activity, commercial tax evasion and mispriced commercial transactions. Many forms of illicit financial flows (IFFs) divert resources away from development efforts. These resources could otherwise be used to ensure that everyone has equal access to basic services like education and health, with dignity and without engaging in corruption.
Anti-corruption efforts, including the timely return of stolen assets, can significantly contribute to accelerating progress on the 2030 Agenda for Sustainable Development. In particular, SDG 16 and its targets on reducing corruption, developing effective, accountable and transparent institutions, ensuring responsive, inclusive, participatory and representative decision making, and strengthening access to information are not only valuable and important aspiration in their own right, they are also important conditions for a successful achievement of the entire sustainable development agenda.  Moreover, the United Nations Conventions against Corruption (UNCAC), with its 186 parties (as of 26 June 2018) is the only legally binding universal anti-corruption instrument. The effective implementation of its comprehensive provisions can make an important contribution to the 2030 Agenda.
This high-level session has the main objective of sharing experiences, good practices, and challenges in terms of building synergies between anti-corruption and asset recovery efforts and the implementation of 2030 Agenda.
The panel will be comprised of representatives from governments, UN agencies and other international organisations, the private sector, and civil society. The facilitated discussion will give participants the opportunity to contribute and discuss on a range of issues:
What are the challenges regarding implementing Goal 16 and its anti-corruption targets? What are the linkages between development financing on one hand and, fighting corruption, preventing illicit financial flows and asset recovery on the other? How can the implementation of UNCAC contribute to accelerating progress in achieving the SDGs? and What are the different roles of the public sector, the private sector, civil society, and international organisations for effectively integrating anti-corruption efforts in the SDG implementation?
The facilitated discussion will provide insights into the way forward for key stakeholders: public sector, private sector, civil society, and international actors, and into how each of them can contribute to anti-corruption efforts (e.g. mainstreaming, measuring, monitoring) and how they can support and build synergies with each other, so as to address the issues of corruption and asset recovery more comprehensively and accelerate progress on the SDGs.

  [1] http://www.gfintegrity.org/issue/illicit-financial-flows/
  

Stemming illicit financial flows (IFFs) is key to achieving sustainable development. This requires serious efforts to combat financial crimes that emanate from criminal activities like tax evasion and corruption. Unless there is an effective response, these IFFs undermine domestic mobilisation efforts in a country and hence are an impediment to the sustainable development goals. This is particularly harmful to the developing countries, where IFFs divert resources that could otherwise be invested in long-term development.

But law enforcement structures in place to combat financial crimes have not evolved at the same speed to keep pace with highly sophisticated criminal activities like tax evasion and corruption. Modern technology is enabling criminals to covertly move substantial sums between multiple jurisdictions with relative ease and great speed. Layers of offshore opaque asset ownership chains can obscure and frustrate the efforts of law enforcement, as can emerging technology like crypto-assets.

Anti-corruption authorities cannot combat this alone. As crimes cross agencies’ mandates, more integrated models of co-operation between agencies need to be developed. An effective Whole of Government approach is the key to meet these challenges, with anti-corruption agencies, tax authorities, customs, police, prosecutors, anti-money laundering agencies and regulators working effectively and on the same side. Each of these must not only discharge their immediate obligations with integrity, but have a mandate and the resources to fight financial crime more broadly.

Neither can individual countries combat this alone. As crimes cross international borders, countries need to co-operate to share intelligence and information. In a globalised economy, criminals will have an advantage over law enforcement by quickly moving beyond national borders, unless countries are working together to level the playing field. For example, transparency and international exchange of information on beneficial ownership is critical to preventing and exposing corruption and illicit financial flows. The gains made in reducing bank secrecy need to be realised. Although mechanisms for international co-operation exist, they need to be used more effectively if financial crimes are to be tackled.

Concrete action can be taken – but it requires a sustained commitment from the political leadership and senior government officials. Some countries have proven the benefits of a domestic whole of government approach, and the importance of international co-operation. For example, the OECD and World Bank will present the findings of their joint Report on Improving Co-operation between Tax Authorities and Anti-Corruption Authorities in Combating Tax Crime and Corruption, which shows that when the many
opportunities for cross-agency co-operation are used, they can have a big impact on financial crime. But these are generally not being pursued domestically, and even less so internationally – and it needs to change.

This session will explore the political and practical challenges in busting the silos and fighting financial crime co-operatively, both domestically and internationally. It will identify what needs to change within governments as part of galvanising the global response to tackle corruption and financial crime.

Technology is neither good nor bad. It’s just a tool—a very powerful tool—and what matters is how the world uses it. It can be used as an avenue to help tackle corruption [1]. The next couple of years will see artificial intelligence, automated processes and machine issued official documents enter states everywhere. Power to make decisions on issues is shifting from public sector workers to algorithms. E-governance applies digital tools in interactions between government, citizens and private business, and in internal government dealings. It is a digital venue to tackle corruption by making public sector processes paper and cashless and to accelerate SDG 16 implementation towards strong institutions marked by integrity.

But behind every opportunity are risks. In a world of digital divide, where large parts of the world population, especially women, do not have access to new technology, these new digital avenues to tackle corruption are only open to some. In addition, the code underpinning digital states risks being manipulated or corrupted. No code is more immune to corruption than the integrity and cleverness of the humans who wrote it.

It requires leaders to navigate to the frontiers of technology, of policy and of thinking to mitigate new types of corruption risks. The scale, spread, and speed of change made possible by digital technologies is unprecedented, but the current means and levels of international cooperation are unequal to the challenge.
Co-chairing the session, the Danish Minister for Development Cooperation Ulla Tørnæs and the Norwegian Minister of International Development Nikolai Astrup invite you to further explore the tension between risk and opportunity arising from applying new digital tools to combat corruption.

Introducing the session’s topic, the Danish Minister will present the publication “Code to Integrity”, an easily accessible overview of some current cases of using digital tools for anti-corruption that are available to governments today. Her Norwegian co-chair will introduce Norway’s Digital Strategy for Development Policy that sets out to support partner countries to apply digital tools, including for anti-corruption., and present United Nations Secretary-General Antonio Guterres’ newly established High-Level Panel on Digital Cooperation in which Minister Astrup is a Panel Member.

Following these introductions, the panellists will share concrete experiences and emerging practices of deploying digital tools to combat corruption, keeping in mind both benefits and costs, opportunities and risks.

During the session, a few selected entrepreneurs from the ‘Code to Integrity’ publication will present their digital tools, inspiring the discussion with concrete use cases and exposing the participants to real examples of digital avenues to anti-corruption.

 [1] https://www.researchgate.net/profile/Dong_Shim/publication/247531048_E-Government_and_Anti-Corruption_Empirical_Analysis_of_International_Data/links/56d803f608aebe4638af6790/E-Government-and-Anti-Corruption-Empirical-Analysis-of-International-Data.pdf?origin=publication_detail 

Corruption in countries dealing with conflict or fragility is particularly destructive, as it undermines the ability of governments to provide even the most basic public services, steals from the most vulnerable, and widens inequalities. It exacerbates social unrest and conflict and can contribute to violent extremism. Confronting corruption in these fragile environments is critical for long-term stability and shared prosperity. But this work is extremely challenging and is made more so by a lack of transparency and accountability along with low trust in already weak institutions. The successes and disappointments of the last decades have been instructive in how to effectively address corruption in these difficult and varied contexts. How can we leverage the latest innovations together with what we have learned from past engagements? How can we make sure that efforts to address corruption in fragile and conflict states are most likely to succeed?

The proposed panel discussion will focus on (i) the contextual challenges that must be addressed when confronting corruption in fragile and conflict states; (ii) the core elements of successful engagements and the critical role of ensuring accountability; (iii) the challenges of managing risk and the importance of balancing longer-term sustainable impact on corruption, as well as more immediate successes; (iv) the need to focus on both building capacity and skills within government systems, and building coalitions among civil society and other stakeholder groups; and (v) the untapped potential for transformative interventions rooted in new technologies.

Infrastructure projects carry a multitude of positive benefits to economies and societies as a whole.  Investment in public infrastructure allows governments to respond to policy challenges, foster sustainable economic growth, and ultimately improve the well-being of citizens. Yet, infrastructure projects are notoriously vulnerable to corruption and fraud due to their size, complexity and investment value. When corruption risks materialise in infrastructure projects, the environment, economy, and citizens may suffer. With investment constituting 20% of gross domestic product (GDP) in OECD countries[1], governments are expected to manage corruption risks in order to ensure that resources are used effectively, and that projects are implemented to the highest standards of quality and integrity.

 Throughout the life cycle of an infrastructure project, governments are required to navigate various sectors and industries, bringing together a multitude of actors that may pose different corruption risks. Indeed, the OECD foreign bribery data[2] shows that 57% of cases involved bribes to obtain public procurement contracts, and state-owned enterprises (SOEs) in particular are vulnerable to corruption also resulting also from their close relationship with decision makers.

Due to their complex nature and evolving timescale, large infrastructure projects bring with them considerable integrity and corruption risks at each stage of the investment cycle. From the exercise of undue influence or capture during the preliminary stages to opaque practices in the procurement cycle and suboptimal performance in the implementation and operation phases, corruption risks can derail the effective delivery of infrastructure projects and divert public investment from its intended use. Corruption in infrastructure can cause environmental, safety and health risks. Moreover, it has a significant opportunity cost: at a global level, a country with high levels of corruption tends to invest less in education and health systems and more in prestigious infrastructure projects that do not always have obvious benefits for society.

This session will explore the strategies and mechanisms by which governments, contractors, and other key actors involved in the selection, design and delivery of public infrastructure can effectively address corruption risks. From ensuring due diligence is undertaken in the preliminary selection phase to designing resilient procurement and management strategies and tools, the session will offer a holistic perspective on effective risk management of corruption risks in public infrastructure. Drawing from the panellists’ own experience and the OECD’s standards and evidence base, participants will consider the main challenges for managing risks across the project cycle, as well as the tools and measures that can be adopted to ensure that public infrastructure projects are delivered in line with the principles of integrity, effectiveness, efficiency, and transparency. Among other initiatives, this could include e-procurement, collective actions, applying the High-Level Reporting Mechanism, as tools for safeguarding integrity and combating corruption in infrastructure.
  [1] OECD (2016), Integrity Framework for Public Infrastructure, https://www.oecd.org/corruption/ethics/Integrity-Framework-For-Public-Infrastructure-Brochure.pdf
[2]  OECD (2014), OECD Foreign Bribery Report: An Analysis of the Crime of Bribery of Foreign Public Officials,  http://www.oecd.org/daf/oecd-foreign-bribery-report-9789264226616-en.htm

Tackling corruption is an essential part of to ensuring that governments are responsive to, and effective in, delivering for all citizens. Open government approaches – promoting more transparent, responsive, and participatory governments - make it harder for corruption to flourish. They ensure that information is made available and that citizens have explicit ways to monitor, thereby not just facilitating prevention of corruption but also facilitating ease of investigation and prosecution where necessary. Open government approaches to tackling corruption also recognize that civil society can be a partner to governments, lending their expertise to advance implementation, and mobilizing citizens to be the eyes and years of government.

This session, co-led by the Government of Georgia and the Open Government Partnership, explores some innovative ways that countries have used open government approaches to tackle corruption Over 75 national and 20 local governments are part of the Open Government Partnership, through which they are working with civil society to advance their anti-corruption agenda. For example, OGP countries have made commitments related to open contracting, transparency in natural resource governance, citizens monitoring of budgets, institutionalizing social accountability for delivery of public services to identify and plug leakages in essential government programs. The Government of Georgia, having just completed its tenure as the Co-Chair of OGP, will share experience of developing innovative ways to prevent and fight against corruption in public services.

The panel will also explore how countries piloting different anti-corruption reforms are linking their OGP commitments to other global dialogue on anti-corruption, such as SDGs, G20, OECD, or using their OGP action plans for promote accountability for implementation of their 2016 UK anti-corruption summit announcements. The conversation led by ministers, senior civil servants, civil society leaders, experts from international organizations will explore challenges and opportunities of tackling corruption through open government approaches.

Secretly owned companies, where the identity of the real owners – the ‘beneficial owners’ – are unknown, are the favoured getaway vehicles of the corrupt. According to World Bank research[1], these companies are used 70% of the time to launder the proceeds of grand corruption. These companies also enable fraud, tax evasion, organised crime and terrorist financing, at great cost to citizens, particularly in the developing world. There is increasing realisation that transparency of beneficial ownership is a critical tool to prevent and tackle corruption and other illicit financial flows; and as a global issue, there must be a global effort to eliminate the secrecy that provides a safe haven for corrupt money.
In the last three years, there have been significant moves towards greater global transparency:

• The G7 and G20 have made transparency in beneficial ownership a key priority;
• At the London Anti-Corruption Summit in May 2016, 38 countries made commitments to improve beneficial ownership transparency[2], several of which included commitments to national public registers;
• Beneficial ownership transparency became a requirement of the EITI Standard for all oil, gas and mining companies in over 50 countries;
• The European Union is requiring all member states to establish public registers;
• Countries, including Denmark, Ghana, Norway, the UK, Ukraine and Zambia, have passed national legislation enabling beneficial ownership transparency and are working towards, or already have established, public registers; and
• The World Bank is publishing the beneficial owners of any company winning a contract on any large Bank-funded project from 2018.                                                                                                                                              

However, international architecture lags behind these developments, and the capacity, tools and technical assistance needed to develop national and public beneficial ownership registers are not yet in place.

This session asks how these obstacles can be overcome and what the challenges are at a country level in creating national registers and making them public. Looking further ahead, it asks what is needed to achieve a global norm of beneficial ownership transparency and how can we harness international and national leadership to this end?


  [1]Stolen Asset Recovery Initiative Puppet Masters: how the corrupt use legal structures to hide stolen assets and what to do about it (2011)
  [2] Including Afghanistan, Argentina, Australia, Brazil, Bulgaria, Canada, Colombia, France, Georgia, Germany, Ghana, India, Indonesia, Ireland, Italy, Japan, Jordan, Kenya, Malta, Mexico, Netherlands, New Zealand, Nigeria, Norway, Republic of Korea, Romania, Russia, Singapore, Sri Lanka, Switzerland, Tanzania, Trinidad and Tobago, Tunisia, Turkey, Ukraine, United Arab Emirates, United Kingdom and United States.