Understanding and Preventing Corruption

Rather than defining the term ‘corruption’, the opening chapter introduces the topic of corruption by firstly identifying types of behaviours typically labelled ‘corruption’, including bribery, extortion, embezzlement, conflicts of interest, patronage, nepotism and cronyism. The chapter also addresses the issue of grey areas, especially around customary gift giving. The focus then moves to the question of where corruption occurs by introducing the TASP model of analysis – Types, Activities, Sectors and Places. Diverse examples of corruption are provided across these domains. Attention is also given to the scale of corrupt activities in different locations, using a number of case studies, including examples of large-scale and endemic corruption.

The chapter begins by considering the function of corruption in three types of societies: ‘traditional’, ‘patrimonial’ and ‘rational–legal’. Focusing on the highly variable nature of corruption, attention is then given to factors that facilitate corruption and factors that impede corruption. Frustration with government regulations can motivate many people to seek to engage in ‘rent seeking’ or obtaining monopoly control over an area of economic activity. Decision makers in government are also vulnerable to rent seeking in exploiting their control of an area of public demand, such as licences or approvals. The harmful effects of these types of practices are considered, especially in terms of the diminution of government services. Noting that different types of societies provide different opportunities for corruption, this chapter then examines the strategic role of key groups, in different types of societies and outlines specific opportunity factors in corruption, especially in transactions in government processes.

Measuring corruption is difficult, and this chapter begins by explaining how the secretive and consensual nature of corruption tends to put it outside conventional crime statistics. Nonetheless, attempting to measure corruption is important, not least for the design and evaluation of anti-corruption measures. The chapter sets out a wide range of useful indicators, including public experience and perception surveys, employee and supplier surveys, focus groups and media reports, complaints and allegations, and prosecutions and convictions. Another approach involves risk-based analyses of institutions and sectors to assess their vulnerability to corruption. Each of these methods has particular advantages and limitations, but the greater the array of indicators employed the clearer the picture of corruption dimensions and trends.

This first chapter in Part II of the book on designing counter-measures sets out the basic legal and institutional framework required to explicitly address and minimize corruption. Complex measures are required to address the complex nature of corruption. The importance of comprehensive and clear legal prohibitions on corrupt behaviour is highlighted. Emphasis is also placed on the need to follow through from rule setting to adequate deterrence and control through investigations and prosecutions. In a growing number of jurisdictions this is achieved through specialist anti-corruption agencies. International treaties are also described which support efforts within and between countries to eliminate, or at least limit, corruption, including through the dissemination of regular corruption risk assessments and reports.

This chapter builds on the framework outlined in the previous chapter by adopting a more specific theoretical approach to designing effective corruption prevention strategies. The chapter first highlights the relevance of situational crime prevention. This is supported by an analysis of regulatory theory, especially the idea of ‘smart regulation’, and the application of TASP diagnostics. These approaches converge around the idea of a process of (1) analysis of specific corruption types, (2) development of interventions and (3) testing of interventions using triangulated corruption indicators. Examples are provided of particular types of corruption opportunity reducing measures. The chapter concludes by focusing on the role of ‘big gun’ anti-corruption commissions.

This is the first of four chapters that examine ways to prevent corruption in specific settings. Criminal justice provides a good starting point because of the long history of varied and destructive forms of abuse of due process rights and responsibilities in this sector. Corruption has, and still does occur in the judiciary, as well as police and corrective services, in many locations. Examples are provided of how situational prevention principles can be used to eliminate or minimize corruption opportunities. These include the electronic recording of interviews with suspects, video surveillance of police actions, limits on pre-charge detention and entry/exit controls for prison custodial staff.

Government purchasing is an area where situational prevention measures can be used to combat the haemorrhage of taxpayer funds for private benefit. Analyses of these types of cases have highlighted the value of breaking down the procurement process into distinct phases and identifying opportunities for graft at each point. The introduction of rules about open competition and transparency can severely limit opportunities for collusion, along with a prohibition on gifts and benefits to procurement officers. An early intervention approach, through the use of warning flags, can prevent the development or completion of corruption conspiracies.

Public health services can be exploited in the procurement of medical supplies, in influence peddling over prescription practices and drug testing, through poor service standards, and through over-billing and fraud. Understanding opportunity factors is, again, the key means to designing prevention systems and strategies. System vulnerabilities stem from excessive discretion, lack of scrutiny and transparency, and under-enforcement or non-enforcement of rules. The chapter reports on a number of intervention studies that provide promising examples of evaluated practice in corruption prevention in hospitals.

This final chapter focuses on an area of government decision making that is frequently associated with corruption. Corruption is often concentrated in local government in development application and approval processes. Using case studies, the chapter shows that the harmful effects of corruption in urban planning can be extremely serious, including in health and safety risks. Application of the TASP model demonstrates how procedural changes can be introduced into development approval processes that reduce corruption opportunities. Examples are provided from the recommendations of a major inquiry into corruption in one City Council.

The past few decades have seen major innovations and improvements in public sector integrity management strategies around the world. At the same time, corruption constitutes a significant ongoing and damaging phenomenon in many places. There is a great deal of work still to be done in addressing the problem, and this book supports this mission by helping to clarify the nature and causes of corruption and focus attention on ‘what works’ in stopping the onset and continuation of corruption.