30 November 2011

The experience in Victoria and Western Australia (see yesterday’s Integrity Talking Points) of gift giving to officials who respond to the attentions of commercial interests, must be that the trustworthiness of officials is questioned and trust in government is undermined. The purpose of codes of conduct is to create a climate which strengthens the resolve of officials to resist these corrupting influences.

Today is St Andrew’s Day, the patron saint of Russia, Romania, Ukraine, Greece, Scotland, and parts of Portugal, Italy and Malta. His small part in biblical stories, as a fisher of men, is helping with feeding the 5000 with loaves and fishes. Would this type of hospitality be a benefit which an official should declare and register? And the New Zealand connection is that the St Andrew’s cross (from the Scottish saltire) forms part the Union flag in the upper quarter of our flag.

This week on the international stage, measures have been announced for calculating and confiscating the proceeds of activities that breach the OECD Anti bribery Convention and the UN Convention Against Corruption.

The OECD recognises that countries’ ability to seize illegal gains is integral to the international fight against bribery and corruption. All countries that join the Anti-Bribery Convention and UNCAC are expected to engage in this fight. To arm governments effectively, the OECD and the World Bank/UNODC Stolen Asset Recovery Initiative have released guidance on the Identification and Quantification of the Proceeds of Bribery. This sets out measures that governments can use to impose appropriate penalties when companies bribe officials to win contracts or gain undue advantages.

The Identification and Quantification of the Proceeds of Bribery report examines methods for calculating the gains made by companies that pay bribes. Drawing from cases in Indonesia, South Africa, the United States, it shows the most accurate methods for calculating profits, and what can be recovered in a particular legal regime.

The OECD has developed the material to overcome the view in many countries, that penalising bribery is too complicated to be seriously pursued. The report shows what has worked when calculating and seeking to recover proceeds of bribery. Whether more enforcement actions follow is another matter. Last year only three of the 34 OECD Convention states prosecuted companies for bribing foreign officials and few UNCAC actions were raised outside of the United States. New Zealand is rated among the non enforcers of the OECD Convention and remains outside of UNCAC.