Roundtable discussion explores anti-corruption measures

Corruption isn't a problem only for the developing world.

A discussion aimed at helping the World Bank's Multilateral Investment Guarantee Agency (MIGA) explore whether anti-corruption insurance was a feasible means of promoting foreign direct investment to developing countries was held in London, UK, on 9-10 December 2004.

Opening the meeting, Commonwealth Secretary-General Don McKinnon stated: "Corruption represents an implicit tax on investment. We live in a world where many countries compete for the same pool of investment. If a country has a high level of corruption, it becomes far less attractive for potential investors. We must drive home the point that good corporate governance makes good business sense."

Organised by the Commonwealth Disaster Management Agency at the request of MIGA, the meeting was also attended by officials from the Commonwealth Secretariat, the Asian Development Bank, the UK Foreign and Commonwealth Office, the UK Department for International Development, Transparency International and others.

The Secretary-General stressed that corruption wasn't a problem only for the developing world. "It is also very much a matter of concern in Europe and the United States. The corruption scandals of Enron, Worldcom, Tyco and Computer Associates cost a whopping US$460 billion to investors and shareholders.

"The Commonwealth has been actively promoting corporate governance since 1995 and was one of the pioneers of corporate governance as a priority issue for international development."

Mr McKinnon outlined the work done by the Secretariat to fight corruption. For instance, a Commonwealth Working Group on Corruption was set up at the request of the association's leaders. A Commonwealth Corporate Governance Association has been established as a Commonwealth-wide professional network for the promotion of best practice. The Secretariat has also published Principles for Corporate Governance, and is now conducting a training programme for 400 directors in 11 Commonwealth countries with the aim of changing board behaviour.

Participants at the London meeting drew on their experience to describe instances when private investment had been deterred or frustrated by corrupt practices of host countries. They discussed insurance cover as a possible means of making such investment more likely.

CNIS - the Commonwealth News and Information Service, Issue 214, 15 December 2004

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