Corruption,Integrity,whistleblowers,financing political parties

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Critical approach concerning perceptions as to Dutch corruption and integrity, whistleblowers and party financing

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Corruption,Integrity,whistleblowers,financing political parties

  1. 1. Corruption,integrity, whistleblowers, financing of political parties<br />Introduction for the delegation of the Republic of South Africa<br />A.P.Ranner & P.Arlman<br />August 31 2010 The Hague<br />
  2. 2. Transparency International The Netherlands <br /> Position Score (out of 10)<br />Bribery index 20083 and 4 8.6<br />Corruption perception index 20095 and 6 8.9<br />How would you assess your current government´s actions in the fight against corruption?<br /> Total Sample The Netherlands<br />TRAC report 2009<br />Assesses the extent to which close to 500 leading listed companies have publicly reported the strategies, policies and management <br />systems they have in place for combating bribery and corruption.<br />The Netherlands 23, average score by country 17<br />
  3. 3. <ul><li>No major problem in The Netherlands, </li></ul> Yet sectors with high bribery risks and incidents<br /><ul><li>Public sector: </li></ul>Purchasing and selling of goods and services<br /> Granting of subsidies en permits<br /> Granting of passports and staying permits<br /><ul><li>Private sector:</li></ul> Bribery in international trade and production<br /> Real estate and infrastructure transactions<br />Corruption<br />
  4. 4. Fighting Corruption (1)<br />Recent measures<br /><ul><li> Clearer definition of civil servants in penal law
  5. 5. Legal treatment of corruption in private </li></ul> sector brought into line with public sector<br /><ul><li> Maximum penalty for corruption increased </li></ul> from 1 to 2 years<br /><ul><li>Separate logs of foreign corruption cases</li></li></ul><li><ul><li> Capacity increase </li></ul>Rijksrecherche<br /> Public Prosecution Service<br /> to enable more investigations and <br /> strengthen informational resources<br /><ul><li>Increased cooperation between </li></ul>Rijksrecherche, fiscal authorities and public <br /> prosecutions service <br />Fighting Corruption (2)<br />
  6. 6. <ul><li>Fighting international corruption still no priority
  7. 7. Public has no recourse to criminal investigations records
  8. 8. Facilitation payments not included in definition of corruption </li></ul>Fighting Corruption (3)<br />Shortcomings<br />
  9. 9. <ul><li>Municipalities, provinces, polder boards </li></ul> insufficiently use Bibob services provided by Public <br /> Prosecution Service (since 2003):<br /> Investigation of private companies/ <br /> entrepreneurs applying for permits/ <br /> subsidies and refusal of applications <br />impopular: <br />Time- consuming, costly and complex <br />Fighting Corruption (4)<br />Shortcomings<br />
  10. 10. Transparency international:<br />Recommendations<br /><ul><li>Institute special national entity including fiscal detectives to investigate bribery
  11. 11. Improve the protection of whistleblowers from the public as well as the private sector
  12. 12. Become more pro-active in fighting corruption and pay more attention to the follow-up of corruption cases
  13. 13. Bring penal law into line with UK and US anti bribery law and recommendations of CRECO and UNCAC
  14. 14. Make better use of existing anti-corruption instruments and improve reciprocal assistance in the field of corruption </li></ul>Fighting Corruption (4)<br />
  15. 15. Integrity<br />Public sector (1)<br />Theory: good governance <br />Individual civil servants should<br /><ul><li>Act according to law
  16. 16. With due regard to democratic decision making and legitimacy
  17. 17. and perform efficient , effective and sound </li></li></ul><li>Integrity<br />Public sector (2)<br /><ul><li>New civil servants: oath of office
  18. 18. Code for accepting presents
  19. 19. Code of good conduct
  20. 20. Implementation regulation for whistleblowers
  21. 21. Implementation regulation for complaints committee</li></ul> regarding undesired behaviour <br /><ul><li>Appointment of Confidence Manager
  22. 22. Training of moral judgements (ethical dilemmas)</li></ul>Requires implementation, monitoring and sanctioning of integrity policies and client screening<br />
  23. 23. Integrity<br />Public sector (3) <br />Major deficiencies in practice: <br />Insufficient translation of norms into organizational behaviour <br /><ul><li>No priority for operational measures due to</li></ul> priority for core public services and or budgetary restrictions<br />Examples:<br /><ul><li>Delayed oath of office
  24. 24. Opaque codes : small gifts, preference for acquaintances as suppliers
  25. 25. Civil servants having little knowledge of existing integrity regulations
  26. 26. Little knowledge of existing person of confidence
  27. 27. Only incidental training of moral judgement /dilemmas </li></ul> Training limited to highest ranking civil servants, public officials <br /> (mayors, alderman etc.) and recently council members <br />
  28. 28. Integrity<br />Public sector (4a) <br /><ul><li>Develop material compliance codes of conduct as well as symbolic artefacts
  29. 29. Develop transaction monitoring systems & client screening applications
  30. 30. Make integrity screening more important for new personnel
  31. 31. Appoint a compliance officer
  32. 32. Make compliance norms highly visible</li></ul>Possible improvements<br />
  33. 33. Integrity<br />Public sector (4b) <br /><ul><li>Decision makers demonstrate model integer conduct
  34. 34. Signal gaps between individual and organisational norms
  35. 35. Advise individual civil servants
  36. 36. Report periodically (annually) on execution of integrity policies into organizational norms and processes as well its visibility to civil servants </li></ul>Possible improvements<br />
  37. 37. Integrity<br />Private sector (1)<br />Importance increases:<br /><ul><li>Legal obligations
  38. 38. Enables more attention for real commercial and fraudulent risks
  39. 39. Reduces costly legal procedures and reputation risks
  40. 40. Limits liability in the event of accidents
  41. 41. Limits government iniatives to create new legislation
  42. 42. Creates a positive shared company culture
  43. 43. Protects reputation
  44. 44. Improves staff behaviour and social responsibility</li></li></ul><li>Integrity<br />Private sector (2a)<br />Importance increases:<br />Some recent studies in realestate and socialhousing<br />In RealEstate significant distrust of integrity project developers, brokers,traders and taxers. Conclusions: <br /><ul><li>Sufficient: Code of conduct, confidence manager, training, ethicscomittee, realestate ombudsman
  45. 45. No integrity audits and no additional legal penal measures </li></ul> apart from increasing penalties<br />
  46. 46. Integrity<br />Private sector (2b)<br />Importance increases:<br />Socialhousing sector: <br /><ul><li>newinternalrule: practicewhatyoupreach,
  47. 47. Increasedinternalauditingregardingintegrity
  48. 48. Integrity part of risk management
  49. 49. More effectiveinternalsanctions
  50. 50. Integrity more important aspect of culture
  51. 51. Integrity more important forrecruitment and </li></ul>selection of staff<br /><ul><li> No changes in penal code wanted</li></li></ul><li>Integrity<br />Private sector (3)<br />Basic elements: <br /><ul><li> Ethical leadership & culture of integrity
  52. 52. Business code of conduct
  53. 53. Reporting standards</li></ul>100 largest Dutch companies have business code of conduct<br />
  54. 54. Integrity<br />Private sector (4a)<br /><ul><li>Ethical leadership & culture of integrity
  55. 55. Strong commitment board of directors and CEO
  56. 56. High performance and high level of integrity
  57. 57. Spirit and letter of formal rules (legal and financial)
  58. 58. Voluntary adaption of global ethical standards
  59. 59. Employee commitment to core values of </li></ul> honesty, candour, fairness ,trustworthiness, <br /> reliability, elements of deterrents/affirmative<br /><ul><li> Red flag training
  60. 60. Commitment and consistent leadership that makes </li></ul> performance with integrity the foundation of the <br /> corporation<br />
  61. 61. Integrity<br />Private sector (4b)<br />Ethical leadership & culture of integrity<br /><ul><li> Building integrity infrastructure: </li></ul> risk assessment, risk abatement to prevent, detect and <br /> respond<br /> early warning systems<br /> stimulating systemic education and training<br /><ul><li>Ombudssystems: professionally, fairly and promptly and prohibit </li></ul> retaliation<br /><ul><li> Compensation systems : Payment with integrity
  62. 62. No direct cash payments to officials
  63. 63. Clear guidelines and presumptions & strong centralised </li></ul> processes to ensure that hard cases are decided upon. <br /><ul><li> Real due diligence(vetting third parties) and hard extensive </li></ul> contracts <br />
  64. 64. Integrity<br />Private sector (4 c)<br /> Cover: <br /> Conflicts of interest, <br /> Compliance with laws and regulations, <br /> Financial records and other internal information, <br /> Confidentiality, <br /> Accepting gifts and bribes, <br /> Reporting violations, <br /> Fair competition, <br /> Insider trading, <br /> Discrimination. <br />Business code of conduct<br />Effective: Comprehensive, morally justifiable, authentic and feasible<br />
  65. 65. Integrity<br />Private sector (4 d)<br /><ul><li>Truly embed a code
  66. 66. Formal inclusion in major decision making procedures
  67. 67. Internal audit reports on compliance per business unit
  68. 68. Performance evaluation criteria
  69. 69. External reporting about effectiveness
  70. 70. Background investigations on prospective employees.</li></ul>Business code of conduct<br />
  71. 71. Integrity<br />Private sector (4 e)<br /><ul><li>Most effective implementation depends on: </li></ul> ownership structures,<br /> financial market development and <br /> legal environment of a specific country<br /><ul><li> Key internal building blocks:</li></ul> Aligning incentives for executives with corporate interests in <br /> accountable manner: <br />sustainable profitability and adequate risk management<br /><ul><li>Renumeration transparent and accountable (disclosure) …> shareholders advise on executive compensation
  72. 72. Make boards more independent and effective
  73. 73. Recognise role of whistleblowers: hotlines, protection</li></ul> <br />Reporting standards<br />
  74. 74. January 2010 new whistleblowerscode<br />Only Central government & Police, incl. former civil servants<br /><ul><li>Employers duty to protect whistleblowers against intimidation/aggression of colleagues
  75. 75. Confidential communication of wrong doings to trust officer
  76. 76. Easier filing complaints with external body: Commission integrity government
  77. 77. Financial allowance (fixed) for cost of civil procedures and legal assistance court procedures</li></ul>Whistleblowers<br />
  78. 78. <ul><li>January 2010 new whistleblowers code
  79. 79. New publication and education module trust officer
  80. 80. Next steps:</li></ul> National advisory and referral institute for whistleblowers from public and private sector <br /> Central communication point for breaches of integrity public sector<br />Whistleblowers<br />
  81. 81. Transparency International:<br /><ul><li> General law for public sector (as a whole) and </li></ul> private sector <br /><ul><li> Scope of the law: broad subject matter, broad </li></ul> coverage and requirement of honest belief of <br /> whistleblower<br /><ul><li> Primarily protecting whistleblowers not </li></ul> companies<br />Whistleblowers<br />
  82. 82. Transparency International:<br /><ul><li> No penal consequences for whistleblower, </li></ul> only in case of evident wrong doing<br /><ul><li> Whistle blowing is a societal problem not a problem between an employer and an employee </li></ul>Whistleblowers<br />
  83. 83. Financing political parties<br />Annual subsidy for political parties <br /><ul><li>two thirds dependent upon amount of parliamentarian seats,
  84. 84. one third dependent upon amount of members</li></ul>In total some € 13.6 million<br />No buying of votes allowed: heavy penalties vote rigging<br />
  85. 85. Financing political parties<br />Draft law : <br /><ul><li>Add political movements: PVV (1 member)
  86. 86. Publish sources of gifts and donations (transparency)
  87. 87. No obligatory party funding by chosen representatives
  88. 88. Subsidies for party, scientific bureau and junior member party organisation</li></ul>Pressure of Parliament and Greco (Council of Europe) <br />Desirable more attention for regulation of grants, <br /> more attention for transparency, supervision and sanctions.<br />Returned to Council of Advisors for new reading / advice<br />
  89. 89. Financing political parties<br />Transparency International<br /><ul><li>All sources of finance of political parties and or movements should be transparent and accounted for.
  90. 90. Political parties should not be allowed to be involved in business transactions</li>

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