South Africa’s anti-corruption conversation must shift its focus from the ‘why’ to the ‘what’ and, even more importantly, to the ‘how’, says Rabbi Gideon Pogrund, Founding Director of the Gordon School of Business Science (GIBS) Centre for Business Ethics.
“We see a tangible sense of frustration and despondency in the country – a sense that corruption has become endemic and there’s little that can be done to turn the tide,” he says.
“Many South Africans are rightly sceptical about what they regard as ‘meaningless talk shops’ unable to achieve genuine change.”
This sentiment of gloom and powerlessness is dangerous to our future, says Progrund, as people might resign themselves to tolerating unethical behaviour and corruption, instead of collectively working towards turning the situation around.
After extensive roundtable engagements with business and civil society leaders, the GIBS Centre for Business Ethics has now launched an Anti-Corruption Working Guide for South African Companies to facilitate corporate action.
Practical, comprehensive and reader-friendly, the free document is a first attempt at helping executives, board members and managers with the ‘how’ of tackling corruption.
GIBS partnered with Business Leadership South Africa (BLSA) to publish this anti-corruption framework, providing clear and actionable recommendations.
However, these are not cast in stone but are meant to inspire more detailed engagements and collective action against corruption, with businesses working together as well as collaborating with various stakeholders.
Clearly, corruption is bad for business and society. It erodes national institutions and harms competitiveness and investor confidence.
South Africa has learnt this the hard way through the devastating impact of State Capture and other ethical failures.
The extent of corruption has gone beyond bribery to include corporate fraud, collusion between auditors and executives, and theft, amongst others.
A body of research demonstrates the business case for corporate anti-corruption programmes. A Norwegian study found, for example, that companies with such programmes suffer up to 50% fewer incidents of corruption than those without.
To enable South African companies to implement anti-corruption action, GIBS’ working guide incorporates key elements of the international ISO 37001 anti-bribery standard, alongside lessons from tech services company, EOH, which was implicated in corruption but managed to redeem itself.
In addition, high-profile experts – among them Tsakani Maluleke (Auditor-General), Busisiwe Mavuso (BLSA CEO), Cas Coovadia (CEO of Business Unity SA), and Edward Kieswetter (former SA Revenue Service Commissioner) – share their views on what needs to be done.
While the recommendations focus on our specific local context, it was important to also include an international perspective.
“The Centre for Business Ethics builds reciprocal relationships with leading international scholars and institutions to access global thought leadership,” says Pogrund.
“For example, Professor Philip Nichols from Wharton School of Business, whom we hosted as a scholar in residence, gave us valuable insights for the working guide.”
The U.S. Professor, a top anti-corruption expert, describes South Africa as being at a crossroads in terms of corruption, and it could go either way.
Encouragingly, Nichols cited countries that used to have rampant corruption and are now clean, such as Singapore and Hong Kong.
But he also warned that such U-turns don’t simply happen; they require strong action and anti-corruption policies.
To achieve this, the guide proposes 38 central anti-corruption principles, grouped into the following categories:
- The tone from the top and the role of the board
- The adoption and publishing of an anti-corruption policy
- The formation and structure of the anti-compliance function
- The substance of the anti-corruption policy
- The role of regular risk assessments
- The role of whistleblowers
- The role of reparations
- Guidelines for ethical lobbying
The last category shines a light on the role of disclosure and transparency regarding lobbying as well as donations.
Here companies are encouraged to follow international best practice systems (such as ISO 37001) to prevent, detect and address bribery.
Meanwhile, GIBS Dean, Prof Morris Mthombeni, suggests in his call to action that companies should begin their collective anti-corruption action by creating a safe environment for whistleblowers.
He advocates for the funding of civil society organisations that do ‘an exceptional job of fighting corruption’, with whistleblowers acting as crucial partners.
Importantly, the working guide intends to show companies strategies on how to prevent corruption while also offering ways to rehabilitate those who were involved in corruption.
“A number of highly respected companies have been implicated in ethical scandals in South Africa,” says Pogrund.
“In ethical and economic terms, it’s imperative that they can find a way back, to rebuild trust and re-establish their licence to operate, which depends on taking responsibly for their wrongdoing, committing to non-recurrence and possibly paying reparations for the damage they caused.”
Ultimately, the GIBS Anti-Corruption Working Guide is a response to Chief Justice Raymond Zondo, a man of unbreakable integrity, who during the launch of the working guide called for active citizenship.
Urgent and decisive action is the only thing that can still turn the tide on South Africa’s corruption and lift the gloomy national mood.
Click here to download the GIBS Anti-Corruption Working Guide for South African Companies.
