The Convention on Business Integrity (CBi) is a company limited by Guarantee. The organization was established in 1997 with the mission of promoting ethical business Practices, transparency and fair competition in the private and public sectors. Signatories of the Convention undertake to observe the values of the Code of Business Integrity, both within their own organizations and in their dealings with customers and partners. The code includes both sanctions and incentives for the organizations involved.
To show their pledge to the Convention, signatories enter into a purely moral commitment with the intent of benefiting from and upholding the platform of credibility which the members of the Convention share. The Convention currently has twenty-three (23) corporate signatories and more organizations are set to sign on in the cause of the year.
Over the past three (3) years the Convention has continued to gain support and followers in Nigeria and to be recognized globally as a very innovative and as a positive contribution from Africa to global best practices relating to the promotion of good governance– at the governmental level and vis-à-vis the private sector.
Whereas the requirements for acceding to The Convention on Business Integrity are detailed and stringent, the benefits may not be so obvious at first. However, there are several advantages, ranging from those that could profit individual signatories as well as the national economy as a whole.
Attracting social-responsible businesses
An increasing number of businesses and investors (e.g. FTSE4Good Index Series) are looking for business partners that align their operations and strategies with globally accepted social responsibility standards, such as the ten principles of the United Nations Global Compact. Signatories of CBi publically commit to and demonstrate integer business operations, therefore increasing their attractiveness for such social-responsible customers, investors, and partners. In the long-term, this will help to convince more Nigerian business actors to actively engage against corruption which consequently will generate greater investment inflows, benefiting the whole Nigerian economy and society.
Enhancing business reputation
In an increasingly globalized and competitive economy, businesses compete for markets, resources and financing in an ever more complex economic and societal setting. At the same time, standards regarding the environment, labor, human rights and anti-corruption have become ever more important on a global scale, manifesting themselves in laws, regulations and voluntary initiatives. Under these conditions not only the end product a business is trying to sell becomes relevant, but also the circumstances under which it was produced and the reputation the business itself obtained along the way. Various examples have shown that a business’s reputation suffers severe damage by being associated with corrupt practices in the public mind. Joining CBi does not only give signatories a positive image but also helps to put relevant internal and external measures into place to protect its reputation (and credibility).
Reducing uncertainty and risks
The impact of corruption on the environment in which businesses operate is manifold. First and foremost, it introduces uncertainty on issue such as whether or not contracts will be honored, if impartial and competent adjudicators can resolve disputes, if future decisions can be predicted with requisite certainty. Where corruption introduces uncertainty, it also increases risk. Furthermore, corrupt relationships operate to keep newcomers out of the game, thereby inhibiting the growth of the private sector itself. In this respect, joining CBi signals accountability and reliability of integer business operations, which again helps to attract (risk-adverse) national and international businesses.
Minimizing risk of criminal and civil sanctions
Countries are increasingly adopting national anti-corruption laws and international conventions, such as the Bribery Act in the United Kingdom, the UN Convention against Corruption (UNCAC), the Foreign Corrupt Practices Act (FCPA) of the United States, the African Union Convention on Preventing and Combating Corruption (AU Convention) and the Protocol on the Fight against Corruption of the Economic Community of West African States (ECOWAS). Virtually all countries have now criminalized bribery within their domestic arenas, and it is also increasingly becoming illegal in a company’s home country to engage in corrupt practices in another country. Furthermore, the recent years show an increase in international anti-corruption law enforcement (e.g. in 2010 alone, over US $1.75 trillion in penalties was assessed, about 80 per cent of which was assessed against non-US-based corporations).
The risk of criminal and/or civil sanctions is real; companies that practice, condone or turn a blind eye to corruption may find that they become entangled in infractions of the law. This increases the possibility of legal actions being taken against them or their managers. Consequently, international businesses are increasingly including anti-corruption considerations in their sourcing strategy (e.g. from whom to buy products / services) to reduce their own corruption-related legal liability with the supply chain. Engaging in anti-corruption initiatives like CBi constitutes an important step to minimize the risk of litigation by unwanted and risky practices.
Protection of shareholders assets
Obviously, the protection of shareholder assets is a key duty of a company’s management. Since corruption can erode such an asset base through payment of bribes, uncompetitive tendering for supplies or outright fraud, it is of interest to the business to have internal controls as well as external constraints on corruption. A CBi membership helps to establish procedures that discourage corruption in-house and payment of graft to other entities and thereby contributes to protecting shareholders assets.
Heightening employee awareness of corporate policy
Organisations that join CBi send a strong signal to their employees that the fight against corruption is taken seriously. It helps to encourage and support employees in resisting corruption and motivates employees to be proud of the organisation’s integrity and reputation.
The Convention on Business Integrity is collaborating with the HUMBOLDT-VIADRINA School of Governance in Berlin / Germany on identifying and realizing benefits of the accession to the Convention on Business Integrity. The HUMBOLDT-VIADRINA is a leading institution in analyzing anti-corruption incentives and sanctions for businesses. It identifies, analyzes and implements existing and potential anti-corruption incentives and sanctions in real world situations to achieve a sustainable impact on the behavior of business