Author/s
05 Feb 2018


Anti-corruption is becoming a strategic item in the agenda of countries, of international institutions, and of business organizations.

We need to approach anti-corruption with the wisdom of the time: complexity, systemic understanding and, most importantly, survival instinct.

For corporate boards, corruption can no more be addressed as a legalistic or compliance issue. It is neither enough to look at it as an ethical issue. Righteousness is not and will never be a guarantee for directors.

Corruption has to be treated as strategic; anti-corruption too.

Both have the power to disrupt a corporation by destroying its reputation, revoking its license to operate, infringing colossal fines, sending director or directors in jail, or even worse. Corruption and anti-corruption threaten lives.

And corruption is one of these complex notions for which no simple reasoning can do much more than giving an illusion of understanding.

For directors and boards to be really smart in the face of corruption and of anti-corruption, they need to think at another level.

The seriousness of this topic was explored during one of the courses held for the Corrupt Practice Investigation Bureau (CPIB) in Singapore where the LKY School and I delivered a programme on Ethics, Governance and Corruptions for 25 government officials from 14 countries. Especially in Asia where cases of corruption continue to hog headlines and where many countries are not well-ranked by Corruption Perception Indexes, questions of good governance and corruption remain global concerns and demands for rigorous discussions surrounding them are welcomed and encouraged. There is no better way to move one level up than expressing dualities and transcending them.

I will illustrate my method with a metaphor: corruption is to integrity what night is to daylight.

Daylight can be defined rigorously as the time between the sun rises and the time the sun sets.

But who would deny that dusk is already the night coming, that the crepuscule holds some daylight in it or that dawn announces the inexorable coming of the day?

Despite any of its definitions, corruption will remain a grey zone.

And if one wants to approach corruption in a dynamic sense, one has to remember that seasons affect the length of the day.

There are cycles and what is day today may be night tomorrow: a practice that is acceptable today may be considered corruption tomorrow.

Whether it may become acceptable again in the future is relevant. The damages may be done. Anti-corruption is also part of the system of power.

Anti-corruption is also a grey zone.

And for those who believe that anti-corruption should be a matter of principles, alas, whether what you are accused of is carried out by many others is also irrelevant. You will just lose.

When anti-corruption is a matter of competition, the issue is who is targeted.

And if one wants to approach corruption in a globalized world, one has to take into account that night and day, in practice, depends on where you are.

When the sun sets in the west, it rises in the east

There are different perspectives to look at corruption and at anti-corruption. They emanate from different historical, cultural, ideological, political, economic contexts and lead to different definitions and different priority actions.

They are perspectives of power driving the explicit and hidden dynamics of global governance.

These different approach to corruption and anti-corruption shape the agendas of countries, organizations, agencies, political and business actors depending on where they are, what they believe is right and for what they fight.

And this takes place at the highest level.

To illustrate my point, take for instance the discourse of Xi Jinping at the 19th National Congress of the Communist Party of China and contrast it with the National Security Strategy of the United States of America by Donald Trump.

Having both appeared at the end of 2017, these are two strategic documents directly implying their authors and their country in a high level formulation of national priorities.

Both documents use corruption as a central notion for their formulation of risks and indication of policies and actions. Let us first point out the commonalities.

Both documents consider corruption a governance issue.

Both documents embed the idea that corruption is antagonist to the rule of law which is formulated in both documents as a fundamental value.

Both documents refer to the benefit for the people to justify their priority against corruption.

Further, their perspective on corruption is like day and night with, of course, shades of grey.

For Xi Jinping, corruption is the greatest threat our Party faces. It is one of the tests confronting the party as they relate to governance, reform, opening up, the market economy, and the external environment.

Imbued in a long Chinese history of rise and fall of central governments, Xi Jinping wants to make sure that officials are honest, government is clean, and political affairs are handled with integrity.

The integrity of party officials will improve the political ecosystem of the party, strengthen[s] internal oversight as well as its close ties with the people.

Xi Jinping advocates anti-corruption to make the Chinese Communist Party better so as to contribute to the long term stability of the country.

For Donald Trump, corruption also arises from weak governance and the failure of the rule of law which serves to protect the individuals from government corruption and abuse of power, allows families to live without fear, and permits markets to strive.

In the search of a global environment based on democratic institutions, corruption is perpetuated by Transnational Criminal Organizations, corrupt foreign officials, corrupt elites, repressive leaders [who] often collaborate to subvert free societies and corrupt multilateral organizations.

Anti-corruption includes priority actions at the political, diplomatic, and economic levels which are aimed at fighting authoritarian states and allow U.S companies to compete fairly in transparent business climates.

Donald Trump advocates anti-corruption to influence the global playing field, protect the U.S. interests and contribute to political freedom and fair economic competition.

These two perspectives on corruption highlight two sides of what corruption can be.

On the one hand, corruption refers to the loss of integrity of a political system because of inappropriate economic incentives.

On the other hand, corruption refers to the loss of integrity of an economic system because of inappropriate political influence.

To fully understand the system composed of these two perspectives, one has to adopt higher level conceptual framework and then analyze the different dynamics proper to corruption and anti-corruption.

To this aim, a social interaction must be conceptualized as a mixture of a relation and a transaction.

In a relation, two identified parties cooperate to benefit from their joint activity. Most importantly, these parties share a common identity and exist together as a collective. It is this collective that they intend to protect by promoting the integrity of the relation.

The relation is a perspective on social interactions that is eminently subjective. It has value because it depends on parties who are who they are because they share something. Implicitly or even secretly, a relational perspective promotes the values of the parties, their agreed processes, their emotional engagement and even their spiritual co-existence.

In a transaction, two anonymous parties compete to benefit from an exchange. The object of the transaction is what is important because it is its attributes that makes the exchange beneficial for each of the party. It is this individual benefit that is the driver of the exchange and needs to be protected by the integrity of the transaction.

The transaction is a perspective on social interactions that is essentially objective. It has value independently of the parties because of what has been exchanged under specific conditions such as price and quality. Explicitly and preferably transparently, a transactional perspective promotes the value of what is exchanged and this is considered the guarantee of integrity.

For instance, a family relation can be enhanced with a transactional aspect, but would be perverted by the inappropriate influence of material aspects when they become excessive.

Similarly, a commercial transaction can be enhanced with a relational aspect, but it would be perverted by the inappropriate influence of relational aspects when they become excessive.

Corruption is not a one-way street where either the relational or the transactional pervert the other taken as a reference for integrity.

Integrity is not about purity. It is about the drawing of a line in the grey zone, a dynamic process that engages the actors, their references and their context.

The relation lies at the heart of politics like the transaction is at the core of economics. The value judgments that drive perspectives on corruption are thus reflecting ideological frames of references.

Whether economics or politics should drive global governance is the question of power that is coloring the perspectives of Xi Jinping and Donald Trump on corruption.

These two perspectives embed a major geopolitical debate about global governance and the appropriate path forward.

In the game for righteousness, these two perspectives will be used in turn to attribute responsibility and blame and to choose who to point at as good and as evil.

But the reality is that corruption and anti-corruption are inherently complex. Oppositions as much as commonalities should pave the way for a smart analysis of what is going on.

It is necessary to study the policies for fair competition promoted in Chinese laws to also understand how liberal capitalism, with Chinese characteristics, also shape the economy.

It is necessary to study the relations among individuals, families, institutions and corporations in the United States go also understand how relational structures of different sorts also shape politics.

A major difficulty lies in the need to express frames of reference as absolute, thus negating the complexity of the issues at play and their grayness.

There is a need for disentangling the multi-faceted aspects of corruption. And the search for establishing appropriate thresholds of discrimination suffers from simplistic discourses.

Because corruption is a grey zone, the inconvenient truth is that corrupted behaviors are not entirely evil. Similarly, those that are not corrupted may not be paragon of integrity either.

Unfortunately, zero tolerance discourses about corruption do not give credit to this complexity.

This is not to excuse the petty corruption or all the forms of relations or transactions that are so perverted that they should rightly be called crimes and punished for.

It is to avow that corruption and anti-corruption necessitate an acute analysis of the good and evil of social interactions, and that such an analysis will lead to necessarily contradictory judgments due to the complexity at hand.

A transactional perspective on anti-corruption bears the risk of dehumanizing social interactions. It somehow assumes global governance could rely on an objective system of anonymous actors exchanging good and services for defined price and qualities and under a transparent set of rules.

A relational perspective on anti-corruption bears the risk of idealizing social interactions. It somehow assumes global governance could rely on a community of actors sharing the same values, the same objectives the same methods and the same manner to find meaning in existence.

Social interactions are a mixture of relations and transactions and should be treated as such. Competition and cooperation are only the two sides of a mental model and should not pretend to capture the full reality alone.

Like many of the fundamental notions that shape the dynamics of the time, corruption and anti-corruption require navigating the frontier between day and night with full conscience.

And it is useful to recognize that such a full conscience embeds significant psychological and emotional attitudes.

For instance, whether corruption is intimately construed as coming out of one-self (reflective stance) or from others (projective stance) will shape the framing of the analysis and the assessment of risks.

The management of corruption and anti-corruption is not just a rational exercise. It requires the careful identification of dualities and their irrational counterparts.

If corruption is to integrity what night is to daylight, we humans know that our risks and our fears increase with our shadows.

The strategic approach to corruption and to anti-corruption requires a very careful analysis is how this impacts a company, its board and its directors in each of the environments they operate, including at the very personal level.

It is with such a complex, systematic and integrative approach that one can understand better what is happening in terms of political and economic dynamics of anti-corruption

Geopolitical, financial, legal, moral, rational, emotional, cultural, ideological, or even spiritual, there are a number of considerations for the teacher to share in order to help companies board to deal with corruption and anti-corruption.

What is essential is to understand that the context in which targets of anti-corruption efforts are chosen is biased. We can then develop the skills to address this multi-faceted complex issue at the board level.

 

About the author:
Marc Le Menestrel teaches and coaches senior executives and board directors on high level performance and leadership as well as the exercise of wise power in governance, sustainability, anti-corruption and risk management. Leading companies and academic institutions are using his expertise and innovative pedagogical approaches to inspire leaders in search of both performance and meaning. He is advisor to the World Economic Forum on its Partnering for Anti-Corruption Initiative. He was also a key facilitator for one of LKY School's Executive Education Programme on Ethics, Governance and Corruptions. For more information about Executive Education, pls visit http://lkyspp.nus.edu.sg/executive-education.