It’s International Anti-Corruption Day – an occasion for our societies to recommit to the cause.
In a year like this, when the world has seen vivid depictions of the most extreme ways that unchecked corruption can upend lives and livelihoods, we need everyone – from governments to civil society to businesses – to join the fight.
At this opportune moment, the ever-growing global community of anti-corruption champions, frontline fighters, partners and allies came together this week to exchange evidence, ideas and strategies. As the International Anti-Corruption Conference (IACC) 2022 nears its end in Washington, D.C., our collective resolve to counter entrenched, globalised corruption is as strong as ever.
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The world sees kleptocrats
By all accounts, 2022 has been a turbulent year. It has also been a year when the international community finally recognised the dangers of unchecked, cross-border corruption and paid attention to our calls – even coming around to some key solutions to counter it.
Russia’s full-scale invasion of Ukraine in February triggered a global awakening on the urgent need to counter kleptocratic advance. While long overdue, leading democracies have now committed to denying safe haven to kleptocratic assets and launched new channels for international cooperation. Some also accelerated key reforms, but much more is needed to end western complicity in transnational corruption.
The momentum needs to catch on beyond the west as well. This year, the G20 – which brings together some of the largest economies – has failed to advance the anti-corruption agenda in any meaningful way, giving kleptocrats a free pass.
As the conversations at the IACC 2022 have also confirmed, grand corruption is a lived reality for people in far too many places, and the concern that kleptocracy threatens everything from sustainable development to global security is shared across the world.
On International Anti-Corruption Day 2022, Transparency International calls on leaders to stop kleptocrats and protect the common good in three main ways.
1. Proactive transparency
Thanks to sustained civil society efforts over the past decade, now there is a global consensus that criminals and the corrupt should not be allowed to abuse corporate secrecy to mask their ownership of ill-gotten wealth.
In March, our efforts helped establish a new global standard on company ownership transparency, which now requires that every country set up a centralised beneficial ownership register. This is a game-changer: more than 200 jurisdictions will have to follow the new standard, including financial centres that have so far been reluctant to fix the gaps in their frameworks.
However, the beneficial ownership transparency agenda suffered a serious blow in November, when the EU’s highest court invalidated the anti-money laundering provision guaranteeing public access to such registers. Prior to the ruling, 22 out of 27 EU countries had opened up their company beneficial ownership registers, enabling investigations into suspicious assets worldwide. By the end of November, eight countries had suspended public access to their registers.
To ensure that the EU does not slide back into the era of corporate secrecy, there is an urgent need to find appropriate solutions so that access to this critical data is restored for all stakeholders. This is vital for anti-corruption efforts – not just in the EU but globally.
Beyond anonymous companies, the international community also needs to tackle other vehicles that are used in corruption schemes. Secretive trusts are next in line, and it will be key that the global standard on trust ownership – which is currently up for revision – leaves no loopholes. It is also high time to get serious about creating unified asset registries to record the real owners of properties, luxury goods and other high-value assets – and build the path towards a global asset register.
2. Accountability for kleptocrats
To effectively deter kleptocrats – whether from Russia or anywhere else – governments need to deny safe haven to them and their money.
Shortly after Russia invaded Ukraine, several governments – such as those making up the G7 – set up the Russian Elites, Proxies, and Oligarchs (REPO) Task Force. This has strengthened cooperation, information-sharing and coordination on sanctions implementation. The task force members have also committed to, where possible, confiscating frozen assets and bringing kleptocrats’ enablers to justice.
But when Transparency International examined these countries’ ability to deliver on this mandate, we found that authorities tasked with freezing, seizing and confiscating illicit assets do not yet have sufficient powers, resources or tools.
At the end of June, we were pleased to see that the G7 leaders’ communique recognised the need to increase accountability for kleptocracy, and that they are open to exploring additional measures for improving their frameworks and scaling up the effort.
So that there can be accountability, governments need to improve their legal frameworks and dedicate more resources to the agencies tasked with locating or investigating illicit assets. The REPO task force should expand current coordination efforts to trace assets of other kleptocrats and individuals involved in grand corruption, making the multilateral task force a permanent body.
3. Defending the defenders
Independent civil society and free media are the world’s best defence against kleptocracy. And yet, anti-corruption civic space continues to take serious hits around the world.
In Russia, the executive director of our chapter was designated as a “foreign agent”. From Georgia to Guatemala to Madagascar, unscrupulous actors have retaliated against those who have bravely exposed and confronted corruption.
In December 2021, the UN Special Rapporteur on the situation of human rights defenders issued a report that documents cases of threats, violence, harassment and persecution against anti-corruption activists. Many perpetrators have acted with impunity, according to the study.
Yet the report also highlights how, against all odds, frontline anti-corruption fighters have been driving anti-corruption change. Given their contribution to advancing human rights, the UN Special Rapporteur has also made the case for the protection frameworks applicable to human rights defenders also applying to anti-corruption activists.
In a powerful show of solidarity, over 80 organisations and individuals have today called on governments to end reprisals against anti-corruption activists and extend them protections as human rights defenders.
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