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Businesses join NGOs to tackle corruptionNGOs welcome business sector initiatives to support transparency and fight corruption
9 Jun 2014 Jana Liptáková Corporate Responsibility
WHILE non-profit and non-governmental organisations (NGOs) have led the crusade against corruption and weak transparency in Slovakia, now the business sector is joining the fight. Last year, several companies teamed up with the Fund for a Transparent Slovakia, while this year several others formed the Slovak Compliance Circle.
“Transparency and honesty when doing business are the most important activities of responsible companies in the perception of the public,” Beata Hlavčáková, the programme director of the Pontis Foundation and the executive director of the Business Leaders Forum (BLF), told The Slovak Spectator. “This is one of the results that regularly comes from the public surveys that the BLF have been organising since 2004.”
Transparency and business ethics are topics the BLF deals with regularly, either within companies or by influencing the external environment that affects the business success of firms.
“It is important that companies set up processes and maintain ethical principles during everyday decisions and eliminate the risk of corrupt behaviour,” said Hlavčáková.
Perception of corruption in Slovakia
World rankings show a high perception of corruption in Slovakia. Based on the Anti-Corruption report of the European Commission (EC) published in February, 90 percent of Slovaks believe corruption is widespread in their country, while 53 percent believe that the level of corruption has increased over the past three years. According to the report, the independence of the judiciary, prosecution of corruption, financing of political parties, the use of EU funds and public procurement are the key areas for Slovakia to focus on when tackling corruption.
Even though Slovakia has made considerable efforts to improve the legal anti-corruption framework for criminal law and public procurement, several factors still limit the effectiveness of anti-corruption efforts, the EC stated in the report summary. Those factors are mainly problems with legislation, a perceived lack of independence of the judiciary and close ties between politicians and businesses.
Based on the newest Corruption Perceptions Index 2013 by Transparency International, Slovakia ranked 61st out of the 177 countries evaluated - the fifth worst among EU countries. Only Romania, Italy, Bulgaria and Greece placed lower. Simultaneously, more than 70 percent of people do not trust the courts and do not believe that justice prevails in Slovakia.
NGOs see a lot of room where they can help combat corruption and improve transparency.
“There exists a huge amount of possibilities,” Zuzana Wienk, the programme director of the Fair-Play Alliance (AFP), told The Slovak Spectator, adding that these include uncovering suspicions, commenting on laws, bringing in expert opinions, educating people, helping whistleblowers, organising campaigns and many others.
According to Gabriel Šípoš, director of Transparency International Slovensko (TIS), NGOs primarily help to check the work of politicians, the issuing of laws, the allocation of subsidies and the organising of tenders.
“Without public supervision, all these issues are prone to corruption,” Šípoš told The Slovak Spectator.
The NGOs involved in the fight against corruption see the enforcement of the law on free access to information as a very important part of their work.
“Offices still quite often unreasonably turn down citizens’ requests for information,” said Šípoš, citing a recent case when the Education Ministry refused to provide a businessman with the contract for the purchase of toners and changed its mind only after TIS provided legal aid.
Wienk sees sabotaging the law on public access to information by courts or public institutions, and inactivity of the police and the prosecution, as the biggest obstacles that NGOs face when fighting corruption. The Pontis Foundation believes that anticorruption NGOs need more public support.
“Disinterest in public affairs and apathy in society are the worst enemies for initiating changes to improve the situation,” Lenka Hujdičová, the programme manager at the Pontis Foundation, told The Slovak Spectator.
According to Šípoš, the fact that corruption has become a major topic for almost every political party, in contrast to 15 years ago, is a major success. But he still sees the unwillingness of politicians and civil servants as a formidable barrier, as well as the fact that NGOs lack money.
“The annual budget of the three main Slovak anticorruption NGOs does not exceed €800,000,” said Šípoš. “For comparison, about 7,000 tenders for €7 billion have been announced in Slovakia annually.”
The philanthropic map the Pontis Foundation made for 2012 shows that firms preferred focusing on cultural, education and environmental issues, with only 0.3 percent, or €42,000, allocated from corporate donations to improve transparency and fight corruption, and 2 percent from the income tax assignment scheme.
But Pontis sees improvement here as well, as more companies have joined the Fund for a Transparent Slovakia. The organisation was initiated by BLF member companies in 2012, which were increasingly bothered by insufficient law enforcement in Slovakia and felt that it was necessary to use societal pressure to improve the conditions in the market. This is why they support watchdog and analytical organisations to develop transparency and a healthy business environment.
“Over one year and a half of the existence of the Fund for a Transparent Slovakia, five other companies outside the BLF have joined the seven launching members of the fund,” said Hujdičová. “Other significant companies have shown interest, too, while they plan to join the fund this year.”
The founding members were Západoslovenská Energetika, Slovenské Elektrárne, Slovak Telekom, Heineken Slovensko, Accenture, Embraco Slovakia and Slovalco. In 2013 Východoslovenská Energetika, Bayer, Slovenská Sporiteľňa, Hillbridges and DM Drogerie Markt became partners of the fund.
The fund has so far supported nine NGO projects with a total sum of €130,000, while the supported organisations included Via Iuris, Fair-Play Alliance and TIS. This year the fund focused on supporting a healthy judiciary and functional courts.
Pontis, BLF and the Fund for a Transparent Slovakia plan to continue their efforts to improve the business environment and introduce ethical standards, and they want other strong, established players to get involved as well.
The BLF is preparing a monitoring programme under which member companies will be able to assess their performance in the field of ethics and transparency within the company.
Activities from the business sector
Another anticorruption activity comes from the IT sector, which is, along with construction, regarded as one of the most corrupt fields in Slovakia. While the Slovak arm of the IT company Accenture has decided to steer clear of state public tenders and state orders because of corruption, Miroslav Trnka, the founder of IT company Eset, has announced the launch of a foundation to help combat corruption in Slovakia.
But the start of the foundation’s operation has been very bumpy. Trnka admitted to the Hospodárske Noviny economic daily in late April, that it took years to find a director for the foundation, as people are afraid of the possible repercussions of exposing corruption. The foundation plans to start increasing awareness about corruption as well as protection of those who uncover corruption this summer.
Earlier this year the German-Slovak Chamber of Commerce (SNOPK) got together with KPMG Slovensko and Lansky, Ganzger & Partner Rechtsanwälte to start the Slovak Compliance Circle (SCC) to combat negative impressions of the business community by promoting ethical behaviour and compliance. On the day of the launch, the foundation was joined by Atos IT Solutions and Services, Continental Matador Rubber, Hewlett-Packard Slovakia, Mercedes-Benz Slovakia, Mondi SCP, Siemens, Slovak Telekom, Tatra Banka and Volkswagen Slovakia.
“Via the recently founded Slovak Compliance Circle, the companies involved want to set an example themselves that transparent and ethical business behaviour belongs among their top priorities,” Markus Halt, spokesman for SNOPK, told The Slovak Spectator back in February.
The SCC members should actively promote and apply ethical principles, reject unethical practices and clearly communicate their own values and attitudes to unethical practices.
The initiative was welcomed by anti-corruption NGOs, while they are waiting to see its specific activities.
“We like to see that the private sector is also joining the fight against corruption,” said Šípoš of TIS, adding that without the involvement of the private sector, corruption in the state would not exist.
Ján Vittek, the SCC chairman of the board of directors, specified for the aktuality.sk news website that procurement is the field in which the principles of ethical behaviour in companies are most often violated. He sees whistleblowing as one measure that would help foster ethical behaviour in Slovakia.
“Companies, especially bigger ones, have whistleblowing on paper,” said Vittek. “However, the situation with its real application is worse.”
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