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  in focus  
22 January 2007  

IN FOCUS: The World Economic Forum




Introduction

At 1859 meters, with more than 2000 participants including 1000 companies with a combined turnover of about US$ 10 trillion, this year’s World Economic Forum annual meeting in Davos, Switzerland is more about equations than big numbers. Under the theme "Shaping the global agenda: the shifting power equation", governments, journalists and businesses converge to talk about how to make this a more economically prosperous world.

The programme contains a varied mix of subjects ranging from business and technology to geopolitics and climate change. There is of course, the topic of corruption. While in the past, corruption has been highlighted in various areas in the annual meeting, this year, the particular focus is on the private sector. As corruption in the private sector is one of its global priorities, Transparency International has a close eye on this event that is ‘committed to improving the state of the world.’ For TI, improvements can be made when the world is free from corruption and so, it is truly beneficial that this topic has its part to play in the meeting.

The World Economic Forum: History and Background

The World Economic Forum (WEF) was founded by Swiss business professor Klaus M. Schwab as an independent international organisation committed to fostering partnerships between business leaders and politicians around the world. The WEF is committed to ‘contribut(ing) towards the problems of our age’ by promoting networks and dialogue to shape regional, national and international economic agendas. The annual meeting of the WEF takes place for five days at the beginning of every year in Davos, Switzerland with more than 2000 people participating in workshops and panel discussions that address significant global problems. In recent years, regional meetings have also taken place in China, Africa and India, to widen the scope of the WEF.

Civil Society’s Answer: The World Social Forum

As a counter-event to the World Economic Forum (WEF), the World Social Forum (WSF) is a civil society event that brings together the anti-globalisation civil society movement to discuss issues of global importance. The WSF rallies around the call that “another world is possible” and offers a platform to all those who are normally not included in international events such as that in Davos. It allows for self-organised workshops and events, giving it a festival atmosphere that strives for equal representation between the developed and developing world. The event, which gathers thousands of civil society organisations interested in issues that include social justice, good governance, accountability and transparency, also includes discussions on corruption in areas such as revenue transparency and political corruption. This year, the WSF was hosted in Africa, in Nairobi, Kenya from 20 until the 25 of January 2007, where corruption featured repeatedly as an issue.

The WSF showed its commitment to the fight against corruption when it hosted the International Initiative on Corruption and Governance (IICG) event at the 2004 WSF in Mumbai. Entitled ‘The People Speak Out against Corruption and Governance’, the workshop encouraged the participants to share experiences in combating corruption in their respective countries. In addition, the WSF has given rise to a number of local social forums where corruption is tackled at national and regional levels. Political corruption will be a major topic at the first US Social Forum, which will be held in Atlanta between June and July 2007.

For more information about the World Social Forum go to: http://wsf2007.org/


Transparency International’s Involvement in WEF

Transparency International has been a long-time participant of the World Economic Forum (WEF) to provide input on how businesses and governments alike can use anti-corruption tactics and tools to clean up the private sector. And this year is no different. Huguette Labelle, Chair of TI, will be attending with the view to keeping transparency and social corporate responsibility on the agenda of top business leaders. Ms. Labelle also will be participating in the civil society meetings at the WEF with the heads of organisations such as Amnesty International, Civicus, Human Rights Watch, Save the Children and the World Wildlife Federation, debating the question of global political and economic leadership, and the accompanying concepts of responsibility and accountability.

Jermyn Brooks, head of TI’s work in the private sector, is making his focus at the WEF the Partnering Against Corruption Initiative (PACI). Based on TI’s Business Principles for Countering Bribery, PACI is a business driven global initiative to prevent corruption in business starting with commitment from the top. By signing onto PACI, CEO’s commit to a zero-tolerance policy on bribery and commit to implement a practical and effective anti-corruption program within the company. This is intended to level the playing field, by developing multi-industry principles and practices based on integrity, fairness and ethical conduct.

To read more about PACI go to: www.weforum.org/en/initiatives/paci/index.htm

To learn more about TI’s work in the private sector, please see: www.transparency.org/global_priorities/private_sector.

In particular, please see: www.transparency.org/global_priorities/private_sector/business_principles

For more information about Business Principles for Countering Bribery as well as the suite of tools designed to support the implementation of the Business Principles, such as the comprehensive Guidance Document and the TI Six Step Implementation Process.


WEF Open Forum 2007: How TI’s work relates to key issues

The Open Forum, organised by the Federation of Swiss Protestant Churches and the World Economic Forum, offers a possibility for open debate on globalisation and its consequences, giving civil society a way to be involved with the WEF annual meeting. To better inform this open discussion, Transparency International (TI) takes a closer look at how its work relates to four of this year’s issues on the agenda of the Open Forum.


Issue #1: Billions of Development Aid: What are the Results?

Setting a new global priority on poverty and development in 2006, TI has started to examine how corruption is a serious obstacle to development, concentrating on preventing corruption in aid and donor anti-corruption policies with a focus on humanitarian aid. www.transparency.org/global_priorities/aid_corruption

To address corruption in relief and reconstruction efforts following natural disasters and civil conflicts, TI published the report Mapping the Risks of Corruption in Humanitarian Action, which maps and analyses the risks of corruption in the provision of humanitarian relief. The report helps humanitarian aid providers identify and combat corruption in their activities.

The Working Paper #03/2006: Corruption in Humanitarian Aid provides an overview of corruption in humanitarian aid. It explains why humanitarian aid is at risk from corruption, what potentially can be done to minimise these risks, and concludes with suggestions for further investigation and action. www.transparency.org/policy_research/policy_working_
paper/corruption_in_humanitarian_aid

In addition, TI joined forces with poverty fighter and Live8 organiser Bob Geldof who visited the Secretariat in February 2006. For more information got to: www.transparency.org/news_room/in_focus/2006/geldof



Issue #2: Sustainable Energy Consumption: Does Anyone Care?

Environmental corruption could seriously impact everyone. From mining and oil, to logging and genetically modified crops, all around the world there are companies which continue to pay bribes in order to bypass environmental controls which are there to protect us.

The October 2006 edition of TI Watch, highlighted how corruption corrodes our precious natural resources, for the price of the growing need of energy industries. www.transparency.org/publications/newsletter/2006
/october_2006/spotlight



Issue #3: Managing Access to Oil: The Risk of the 21st Century

Countries rich in natural resources with reserves of oil, gas and minerals tend also to be rich in pollution, corruption and poverty. The paradox of these natural resources or extractive industries means that they generate wealth, but usually not for the people closest to them. The ‘resource curse’ can lead to violent disputes over revenues; often fought with the very arms purchased with the profits generated by these resources. It also can lead to an increase in poverty if money that should go to social investment is misappropriated or mismanaged. All this can, in turn, weaken domestic political cohesion and the rule of law. Transparent resource governance is the key to transforming this curse back into a blessing. Vital to improving accountability, transparent governance can strengthen the responsibility of stakeholders – of host governments to their citizens and of companies to their investors.
TI’s Revenue Transparency Project will address how this transparency and accountability can occur. www.transparency.org/policy_research/surveys_indices/
promoting_revenue_transparency

The Extractive Industries Transparency Initiative (EITI) is a multi-stakeholder initiative involving representatives from national governments, the extractive industries, intergovernmental institutions and civil society designed to increase transparency in revenue flows between oil, gas and mining companies and their host governments. In essence, the goal is to monitor and publicise these revenues so that citizens can hold their governments accountable for their use of the money. Read more at www.transparency.org/publications/newsletter/2006/july_2006 and www.eitransparency.org



Issue #4: Brands: Today's Gods?
The growing importance of brand and the “good name” as an economic factor has increased the risk of scandals and the damage that occurs to the reputation of companies. Integrity and corporate social responsibility are, therefore, growing competitive factors companies have to consider.


Corruption scandals are one of the biggest risks to the image and integrity of a brand, and the corporation behind it. In addition, anti-corruption measures are vital in competing for new business opportunities such as World Bank tenders, as their approved World Bank’s Voluntary Disclosure Programme illustrates. http://www.transparency.org/news_room/latest
_news/press_releases/2006/2006_08_01_call_world_bank

TI provides a series of tools to prevent corporate corruption and offers guidelines on how to put effective anti-corruption systems into place. One key tool in this area is the Business Principles of Countering Bribery. www.transparency.org/global_priorities/private_sector
/business_principles

To get involved in the online discussions of the Open Forum go to: https://connect.weforum.org/display/openForum2007/Home


The Davos Diaries

Being a truly interactive affair, many of the events during the annual meeting can be accessed online. This means that influential political analysts, journalists and policy-makers can post directly from Davos – and civil society, in turn, can get in on the discussions.


For the first time this year, the WEF has launched its own blog. ForumBlog features ‘top bloggers’ such as Michael Rake, International Chairman of KPMG. There are a number of corruption-related blogs, particularly in the section on Africa, http://www.forumblog.org/blog/africa/index.html. To comment on these posts, sign up to ForumBlog, http://www.forumblog.org

The Guardian’s ‘bloggerator’ Davos Conversations is the most complete website after ForumBlog. It features news, audioclips and video interviews directly from Davos. You can post a comment directly without registering at http://davos.guardian.daylife.com/

The BBC’s forum on the WEF 2007 is kept by the BBC’s business editor Tim Weber and Richard Sambrook, director of global news. Go to http://www.bbc.co.uk/blogs/davos07/ to share your views on Davos.

The International Herald Tribune’s ‘Delving in Davos’ blog offers an insightful transatlantic take on the WEF. Its contributors include reporters from the IHT and the New York Times, http://blogs.iht.com/tribtalk/business/index.php

The Financial Time’s In Depth Feature is another excellent resource on the WEF 2007. It features blog and diary entries by David Cameron, leader of the Conservative Party in the UK, and Nikesh Arora, Vice-President of European Operations at Google. See http://www.ft.com/indepth/davos2007/blogs

TI national chapter work on private sector corruption

TI UK

The arms and defence sector is rated as one of the three most corrupt business sectors by TI’s global Bribe Payer’s Index. TI’s national chapter in the UK is working intensively in the area of corruption in the defence sector. The project involves the major stakeholders – exporting governments, importing governments, companies and other organisations (NATO, EU, World Bank, and others) – to reduce corruption in the defence sector, and particularly in defence procurement. For more information: www.transparency.org/news_room/in_focus/2006/defence_sector

TI Lebanon

In June 2006, TI’s national chapter in Lebanon Lebanese Transparency Association (LTA) launched its Corporate Governance Code for Small and Medium Enterprises (SMEs). The Code has been developed on the basis of exhaustive research and a twelve-month consultation process with the private and public sector. The instrument will now be widely promoted and disseminated by LTA. For more information: http://www.transparency-lebanon.org/Code_SME/Code_SME.htm

TI Palestine

In 2006, TI’s national chapter in the Palestinian Authority, the Coalition of Accountability and Integrity (AMAN), worked with the private sector on preventing corruption, culminating in the signing of an anti-corruption code of conduct during a Transparency Festival on 20 December 2006. With this code, companies publicly declared their commitment to fighting corruption in their work (www.aman-palestine.org/English/activities/TrasnparencyFisteval.html). AMAN also organised workshops with experts and company representatives on the adoption of a good corporate governance system in Palestine (www.aman-palestine.org/English/activities/Paltrade/corporatGov.html).

TI Colombia

Transparencia Colombia, together with various companies, has developed and implemented an integral ethical programme for the private sector. The programme is intended to strengthen organisational cultural based on ethical values and includes among others capacitation programmes, codes of conduct, strengthening of ethical leadership, reporting mechanisms, and employee incentives for good behaviour. For more information: http://www.transparenciacolombia.org.co/vcontent/index.php?option=com_content&task=category&sectionid=5&id=19&Itemid=15.

TI Czech Republic

In 2006, TI’s national chapter in the Czech Republic (TIC) completed the project “Viva Etika,” which contributes to increased transparency of the national private sector. The project was aimed at initiating cooperation among the different sectors and to help promote legislative change. In addition, it examined discussions around the necessity of an ethical business approach. The Viva Etika Coalition represents a coalition of companies that are cooperating with TIC, who are promoting good corporate citizenship, unified by the common support of actively implementing ethical principles in business practices. For more information: http://www.transparency.cz/index.php?lan=uk&id=45

TI Australia

TI Australia has been focusing in 2006 on Australia`s Wheat Board involvement in the Oil-for-food scandal and prepared the background brief: ‘Anti-Corruption Laws – Implications for Australian Business’. For more information: http://www.transparency.org.au/ and http://www.transparency.org.au/eupdate_view.php?eupdate_id=11#article_73

Whistleblowing is one of the main means by which corruption is discovered, especially in the private sector. Please click here for an overview it TI Australia’s work on this key area: http://www.transparency.org.au/whistleblowing_links.php


Ziyad Baroud from TI national chapter named “young global leader” by WEF

Lebanese attorney Ziad Baroud, former secretary general and currently a board member of Transparency International’s national chapter “Lebanese Transparency Association (LTA)”, was named a "Young Global Leader" by the World Economic Forum (WEF) in January 2007.

By this annual award, the WEF recognizes and acknowledges the professional accomplishment, commitment to society and their potential to contribute to shaping the future of the world of the top 250 young leaders from around the world.

For more information about this award go to: http://www.weforum.org/en/media/Latest%20Press%20Releases/YGL07_pressrelease


News stories

Media contacts

Katie Taft
ktaft@transparency.org
Tel: +49-30-34 38 20-665

Gypsy Guillén Kaiser
ggkaiser@transparency.org
Tel:+49-30 3438 20-662 / Fax: +49-30 3470 3912

Transparency International, Alt Moabit 96, 10559 Berlin, Germany


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