Collective Action: Should Ethical Business Unite to Combat Corruption?

Last week, the EBRD, the OECD, the Business Ombudsman of Ukraine, and UNDP brought together over 100 senior practitioners from 30 countries for a 2-day regional expert seminar on Business Integrity in Eastern Europe and Central Asia followed by a 1-day roundtable on Business Integrity in Ukraine. In the course of discussions, the participants voiced a hope to see the critical chain of clean business and that national business integrity network of so-called clean companies from different industries will begin to shore-up in Ukraine. The key tune of the roundtable was that the best way to initiate a ‘big bang’ strategy not through seeking ‘big ticket’ reforms in relative isolation, but through engagement at all levels and with all key stakeholders. 

Being inspired with the bigger picture vision, I would like to share the takeaways from the roundtable regarding shaping the business integrity network in Ukraine.

  • Ethical companies agree that they can be agents of change. It was fairly noticed that business being on a supply side of corruption could become a part of the problem. At the same time, it could be also a part of the solution. To bear out what I have said, I would like to share an excellent overview of a range of applications of the collective action concept in different business sectors and various regions
  • Corruption is a big elephant, and the best way to tackle an elephant is by a big band. The institutions alone cannot do the trick and ethical business community should be perceived as a pre-eminent partner of government most capable of putting a stop to corrupt practices, and promoting best practices throughout the markets. So, there is an urgency to start defining a new business integrity agenda, and the companies should unite to fight against corruption.
  • In an area as tricky as corruption, companies may not know where to start. Many companies have already gained not only experience and intelligence, but also an active commitment to create “islands of integrity” in their supply/distribution chains, and in their industries. The difficulty of framing such commitment arises mainly in teaming up a like-minded and like-acted business into a chain of clean business. To address this problem compliance champions and industry leaders have to take active patronage and set a business integrity platform to unite other members of business community.
  • Business integrity network could not be built in one day. It would be too simplistic to believe that a collective action alone would be enough to dissipate the clouds over corrupted economy. Ultimately shaping a national business integrity network should be voluntary. Thus, adherence to business integrity culture would depend entirely on the extent and quality of the companies' commitment. 
  • The business needs a business case. To be successful, collective action requires trust, time, and a joint understanding of risks and potential areas for change. It requires more publicity, advocacy, and more success stories. For companies to support an initiative there has to be evidence that business integrity solution will ease the costs of doing business and that progress could be measured and documented.
  • The first is a project. The business needs a clear proposal, capable of linking short-run actions with long-term reforms, risk sharing with integration. Accordingly, the call for actions has already been developed and provided for public discussion. It could shine a spotlight on the future of collective action in Ukraine. Needless to say that I encourage you to take a quick look at the executive summary as well as to contribute with your comments to the initiative. 

Is there a return on ethics in Ukraine?’ is a tricky question. Following numerous statistics many local businesses  would prefer  storing up some cash for a rainy day to bribe quick wins. However, there are indeed other businesses which are instead ready to spend for a workable and sustainable compliance systems and ethical attorneys. These companies shall unite efforts in fighting against corruption in which way they can save resources and scale up the returns. The old famous British foreign policy strategy was “divide and conquer”. Today, ethical business cannot allow themselves to be divided. They shall unite as an important stakeholder to maintain an open dialogue with the government. Would your firm agree to join an integrity network platform and commit to compliance and business ethics? 

Tetiana is an investigator at the Business Ombudsman Council. Tetiana came to the team with 5 years of experience with international audit firm, where she was a senior associate and headed Corporate Compliance Practice. In 2015, Tetiana was working at Munich office of international audit firm. Tetiana graduated from law department of Kyiv National Economic University named after Vadym Hetman.