|8 March 2016|

By Paul MacAlindin – author of Upbeat – the story of the National Youth Orchestra of Iraq (Release date: August 2016)

“Everybody is corrupt, from the top of society to the bottom. Everyone. Including me.” despaired Mishan al-Jabouri, senior member of Iraq’s parliamentary commission on official corruption. “I was offered $5m by someone to stop investigating him. I took it, and continued prosecuting him anyway.”

Iraqis have little problem being brazen, as there’s no trustworthy mechanism for accountability. Iraq’s firebrand Shia cleric, Muqtada al-Sadr, is threatening a coup d’etat with his militia if the government doesn’t radically eradicate corruption by March 27th. Bribery is haram, forbidden in the Koran, severely punishable, and yet Transparency International lists Iraq, an Islamic republic, is the 8th most corrupt country in the world.

Right from the word go, I had to protect the National Youth Orchestra of Iraq’s budget, and so credible NGOs like British Council Iraq, or partners in Germany and France channelled most of our funds. Our auditions, by Youtube, allowed everyone to see each others’ standard online whilst a worldwide team of professional tutors evaluated the players. This went some way to building trust, but with no standards of their own, some players found it tough to believe they were rejected for not making it in pure competition. Though I trusted the Iraqi team, they still operated in an absurd financial environment where millions in cash passed invisibly through hands every day. But, without the right local connections, my team would also never have had our visas renewed for the summer courses in Kurdistan. What we call corruption is, for that part of the world, simply business as usual. Indeed, not sharing the profits out along the supply chain is regarded as corrupt.

Corruption, the abuse of entrusted power for private gain” is a Protestant ethical definition from North America and Europe, who happen to have led globalisation. But whether it’s cultivating Guan Xi for your business relationships in China, dealing with nepotism in South America or “rampant, systemic, and deep-rooted corruption” in FIFA, what does it matter what we call it when it’s just how things are done around here?

Even in Europe, those areas highly vulnerable to corruption sit at the core of civil society: political parties, public sector procurement, private business and anti-corruption agencies. This hits us all in competition – no level playing field damages standards, profits and restricts freedom of information; accountability – replacing statutory bodies with opaque self-regulation; and the poverty gap – arresting economic development whilst a rich and corrupt elite maintain power.

Even the UK’s fortress mentality is porous, with criminals targeting the UK border agency, police and prison service with bribes, as well as social housing scams to exploit illegal sex workers. Illegal employment is seen as the biggest threat to competition in the construction industry. One interviewee said: “Corruption is an enabler, like violence and intimidation is an enabler. Criminals will use the lowest risk option, which is usually corruption. This can have a massive impact on the UK, whether or not it takes place in the UK.”

A number of solid bread-and-butter measures are being implemented to keep taxpayers’ and shareholders’ investments focussed on value for money. But, in recent years, a push in corporate social responsibility against corruption has also seen grass-roots innovation flourish. Just as with the orchestra, online social entrepreneurship is a common theme:

  • In 2009, Afghan police began to test paying salaries through mobiles instead of cash, using a text and interactive voice response mechanism. Most police assumed they’d been given a significant raise, when they were simply receiving their full salaries for the first time.
  • FixMyStreet in Georgia crowdsources and maps problems facing public streets, and shows the city government’s response.
  • Acting against Match Fixing blacklists Turkish football clubs who are found guilty of corruption. Every day, sports betting firms offer a list of games that can be bet on. Through the project, these firms highlight the guilty teams in a different colour. The customers then become aware that some sort of corruption is going on in that team.

The UK Bribery Act 2010 brings with it the toughest legislation to date. Now, any company or individual based in Britain, or with strong links, can be prosecuted for any bribe of any size, anywhere in the world. UK Corporations or foreign companies working in the UK are also liable for failure to prevent bribery in any part of their company, worldwide, including agents acting as intermediaries.  The government also works to limit corruption in several countries, though none of the top ten oil producers, such as Iraq, appear among them.

As financial products and transactions become ever more complex and innovative, protecting our funding is vital to efficiency, culture change and most of all, trust. Whilst amateurs hack computers, professionals hack people. Hollywood’s scathing critique of the 2008 crash, The Big Short, said it:

Cynthia:   A half a billion in one trade? How is that even possible?!

Mark:   Group think. Fraud. Legalised corruption. Stupidity.

To find out more, Transparency International UK runs a free online course on the Bribery Act and anti-corruption awareness.