The Future and Implications for a Disaggregated Regime

The emergence of numerous international agreements and standards in-tended to reduce transnational and national corruption has created an or-nate web of hard law, soft law, and other standards without a clearly de-fined hierarchy. The vast number of substantive law areas and institutions targeted for reform by hard law mandates, hortatory language, and infor-mal initiatives further complicates efforts to map the anti-corruption legal landscape. The landscape includes such varied matters as mechanisms for international cooperation in asset recovery investigations, whistle blower channels and protections, and public procurement practices.

This author believes that the recent trend toward the promulgation of international agreements and other standards, including by networks of governmental and non-governmental actors, is likely to continue for at least three reasons.

First, the globalisation of business, the conduct of international fi-nancial markets through which trillions of dollars flow daily, and the flow of people and natural resources, all cross national boundaries. Their cross-border characteristics and complex nature create complex challenges that require coordinated solutions and actions by public and private actors

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across national boundaries. Examples of these challenges include the trac-ing of funds illicitly appropriated by public officials, the ability of com-panies to conduct international business without being solicited for bribes, and minimising environmental damage caused by improperly issued emissions permits. It is noteworthy that the private sector has recently joined and is likely to step up its participation in anti-corruption standard setting. The opportunity costs to business of not participating in the global economy are too high to permit companies to focus on purely domestic markets and supply chains. The legal and reputational risks to long-term growth oriented companies of violating legal standards against corruption, however, are propelling business to participate in groupings and initia-tives intended to facilitate compliance with anti-corruption laws and re-duce corruption in rapidly growing markets.

A second reason for this continued trend is that measures that re-duce corruption are not purely technical solutions, but prore-duce winners and losers, and thus mixed incentives for reform. As in the case of the UNCAC, countries are frequently reluctant to agree to precise, binding anti-corruption undertakings. The existence of generally phrased and non-mandatory provisions, as well as the introduction of new broad undertak-ings, are likely to continue to propel the issuance of new standards and in-itiatives by governments, regulators, the private sector, NGOs, and civil society. As in the past, these standards and initiatives will be intended to support the implementation of generally phrased and non-binding provi-sions, including by prioritising specific reforms and adding new specifici-ty through claimed best practices.

Third, information technology and social media are providing new abilities for those seeking to combat corruption to share information, compile data and press for reforms. As societies and upcoming genera-tions embrace and move toward technology, it can be expected that new virtual communities and data will yield new communities of interest and approaches to combat corruption. The ability of sites such as India’s Ipaidabribe.com to collect aggregate data on bribes paid by individuals, and the interest NGOs in other countries have expressed in its approach in combating petty bribery, is one example of how technology is facilitating new communities and innovations.

While new initiatives and collective action coalitions have the po-tential to assist in constraining corruption, the failure of efforts to date to reduce corruption on a global scale mandates some reflection. Several

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recommendations emerge in looking forward at the ability of law and the anti-corruption field to reduce cross-border corruption and corruption within individual nations.

4.1. Better Understand the Interaction between Soft Law and Hard Law Regimes

While there is a hope and assumption that new conventions and soft law standards will strengthen the anti-corruption playing field by raising na-tional laws and practices, further research is needed to understand better how hard and soft law interact in varying circumstances in practice. States and other actors are not limited by a choice of whether or not to enact a new standard. Rather, they will often have the ability to choose their terms of cooperation, including how they will implement a generally worded standard and their choice of which measures to focus on implementing first.

Attention also needs to be paid to understanding the effects of mul-tiple soft law regimes. For example, anti-corruption reforms espoused by a group with a relatively narrow substantive focus may positively alter how nations would otherwise implement reforms to constrain the same types of corrupt practices in other sectors and arenas by setting forth an adaptable, concrete approach. An additional scenario for examination is understanding the conditions under which re-bundling existing soft law provisions into new high profile initiatives enhance or deter from positive progress on the provisions. The inclusion in such an initiative of leaders with known limited support for particular reforms has the potential, for example, to create a positive drag or, alternatively, to impact negatively the country’s longer term progress on the reforms if no significant pro-gress is made under the initiative.

4.2. Include a Focus on the Performance of Country Justice Systems and Close Opportunities for International Money Laundering Successfully combating corruption requires a number of complex laws and institutions. As an example, the United States included in its 2011 self-assessment under UNCAC statutes dealing with foreign bribery, bank fraud, mail and wire fraud, nepotism, procurement, whistle-blower protec-tions, criminal and civil conflicts of interest, and misuse of public proper-ty. Adding international cooperation, and the roles of regional and

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tional law bodies with lawmaking and adjudicatory functions, rapidly ex-pands the laws and institutions involved in combating corruption.

Robust and fair enforcement of civil and criminal laws that combat corruption is essential for a meaningful reduction in corruption. Vigorous and fair enforcement of appropriate norms sanctions those who act im-properly and also encourages compliance with law. Initiatives which ad-vocate specific anti-corruption reforms may inadvertently shift the focus away from ensuring that national and sub-national investigatory, prosecu-torial, defence, and adjudicatory functions have sufficient independence, competency, corruption safeguards, and resources to perform their roles both individually and as a system. Such initiatives may also adversely im-pact the provision of international financial and technical assistance need-ed for such justice system strengthening. All too often, justice system as-sistance efforts are uncoordinated, focus unevenly on differing parts of the justice system without a clear rationale for doing so, and ignore the junc-tures at which different bodies, such as judges and defence counsel, inter-act. In addition to strengthening enforcement within an individual coun-try, stronger country level legal systems can both enhance international law enforcement cooperation and contribute to a more level playing field in that country to support greater economic growth.

The ability of political elites and organised crime to launder, con-ceal and enjoy the proceeds of illicit gains outside their home countries must also be curtailed for there to be any meaningful reduction in global corruption. In both developed and developing countries, corrupt and crim-inal interests are able to launder ill-gotten proceeds in financial accounts and shell companies without law enforcement being able to obtain infor-mation on their beneficial interest. In addition, the loophole and secrecy ridden regulatory systems of offshore financial centres offer safe haven for proceeds of crime and corruption. Until these practices and weak

“know your customer” due diligence requirements for financial institu-tions are comprehensively addressed on a global scale, corrupt officials will be able to shelter funds and a shadow economy of corrupt payments will continue to flourish.

4.3. Increase Research on the Impact of Anti-Corruption Reforms More research is necessary to understand the impact of specific anti-corruption reforms, the conditions under which they are successful, how they hold up over time, and their ability to catalyse further changes down

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the road. In short, much more study is necessary to understand whether various anti-corruption interventions actually alter the corrupt practices they are intended to reduce.

Effective anti-corruption reforms involve breaking down en-trenched political interests, changing incentives, and transforming long standing patterns of behaviour. Recent research, for example, is providing a more nuanced picture of transparency’s capacity to improve the perfor-mance of political institutions. In addition, new small-scale civil society initiatives developed in response to local conditions show important promise in reducing corruption, but their ability to scale up and long term impact are not yet known. This includes not only social media driven in-terventions, but more boots on the ground approaches such as organising village elders to oversee public procurement projects and publicly identify those contractors who utilise inferior construction materials. The im-portance of understanding the impact of specific measures is magnified by the ability of corrupt networks and individuals to adapt their behaviour, find new openings when one channel or practice is foreclosed, and engage in more subtle destructive behaviour. Furthermore, repeating ineffective interventions not only wastes resources and allows corruption to flourish, but, more destructively, can alienate already frustrated populations.