From health care to energy production, state-owned enterprises provide some of the most vital goods and services around the world. Three of the world’s 10 biggest companies, measured by sales, are Chinese state-owned enterprises.
These companies employ millions of people and control vital pieces of some of the world’s biggest economies, like the electricity grid, hospitals and energy imports.
Like private companies, state-owned firms also face corruption risks. But state-owned enterprises are in some ways a special case because of avenues for interference from politicians and public officials, and the potential for bribery related to lucrative public contracts, or when state assets are bought or sold.
Poorly governed state-owned enterprises can also encounter conflicts of interest among board members and managers, or when board members and employees are not selected on merit.
One only need look at the massive corruption scandal surrounding the Brazilian state-owned energy company Petrobras to see the multiple layers of corruption risk involved when billions of dollars are channelled through public agencies and services. The scandal brought down a government, implicated another 18 companies and severely tarnished the reputation of Brazil on the global stage.
How do we tackle corruption at state-owned companies?
Corruption at state-owned companies is not new, but with their increasing economic importance and global spread, innovative ways are needed to fight this scourge. For this purpose, Transparency International and a multi-stakeholder working group including state-owned enterprises have created the State-Owned Enterprises Principles for Countering Corruption.
The State-Owned Enterprises Principles draws upon Transparency International’s Business Principles for Countering Bribery. Also developed in a multi-stakeholder process and first published in 2002, these principles have become a global standard referenced in a range of other international anti-bribery initiatives as well as tools produced by Transparency International and its chapters.
Transparency International has now posted the draft State-Owned Enterprises Principles below for expert consultation. We invite everyone involved with state-owned enterprises, including directors who lead their work, academics who study them, government officials who oversee them, their customers, their employees and members of the public to consult the draft and take our survey. Please give us your feedback on how to make them better, more fit-for-purpose and ultimately, more useful.
Help us help state-owned enterprises stop corruption at the factory gate.
Image: Creative Commons, Flickr / Carl Tanzler
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