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From Iraqi American Chamber of Commerce & Industry Business Ethics
Civil society[1]has never been in the public eye so much as it is today. The political and economicupheavals following the end of the Cold War have profoundly affected the distributionof power. Previously, states had claimed a monopoly on power under the guise of state sovereignty,today that authority is in decline. Now, power is increasingly being claimed or contestedby globalised business and by civil society. Around the world, "soft law" in the form ofguidelines and recommendations are emerging as a wide-ranging body of global practice, notyet with the force of international law, but which states ignore only at their own peril. At the national level, free trade has eroded the power of governments to influence the activitiesof business, who in many industries have the option of taking their business to a morereceptive country. Moreover, civil society is frequently challenging the governments' legitimacyto speak on behalf of the people, and is frequently being used to channel developmentaid in ways that by-pass their officials. Today, NGOs deliver more official development assistancethan the entire UN system[2]. In many countries they are delivering essential communityservices that faltering governments can no longer manage.[3]On the other hand, governmentshave now only the appearance of free choice when it comes to setting economic rules. Increasingly,these rules are being set by the markets, enforced with their own power.[4] At the international level, questions of pollution, of international organised crime, and concentrationsof power in the media have rendered borders almost irrelevant. Indeed, when 122countries agreed to stop using and selling landmines in December 1997, the success was attributednot to the work of government officials, but to the determination of the 1,000 or so non-governmentalorganisations in 60 countries. At the signing ceremony in Ottawa, JodyWilliams, the campaign's co-ordinator, remarked that NGOs had come into their own on theinternational stage. "Together," she said, "we are a superpower".[5] But there are limits inherent in the nature of the power of transnational civil society. It worksindirectly, by persuading governments or corporate leaders or citizens or consumers. The networksremain powerful only so long as they retain their credibility. And sometimes civil society gets it very wrong indeed. Humanitarian relief organisationsfound their credibility badly damaged in 1996 by what turned out to be their exaggeratedreports of suffering and death among refugees from Rwanda. To the extent that transnationalcivil society networks provide inaccurate or misleading information (whether deliberately orinadvertently), they undermine their effectiveness. "When transnational civil society forgetsthat its power is soft, not hard, it not only fails to achieve its immediate objectives but alsoundermines the moral authority that is its real claim to influence."[6] Thanks to the Internet, the importance of proximity and prohibitive costs of communicationshave been virtually eliminated. International networks can be formed swiftly and vastamounts of information exchanged at little or no expense--"dial locally, act internationally"as Jessica Mathews puts it.[7]Global civil society's response rate has risen dramatically, especiallyby human rights groups who within hours of the occurrence of an event galvaniseresponses from around the world. The growth of international movements has been such thatin some areas they have come to dwarf their counterparts within the UN system. AmnestyInternational, for example, is now better resourced than is the human rights arm of the UN.[8] At the same time, the trend to decentralise within the sovereign state has renderedcentral governments still weaker. With decisions being taken at thelowest appropriate level ("subsidiarity" in European Union parlance) a wholerange of traditional government functions is increasingly being dischargedby regional and local governments, from education and health through totown planning and transportation. As the authority of governments has been eroded and as there was a perceivedshift of power in the direction of global business, so, too, did civilsociety emerge as a much more potent actor than hitherto. To some, at least,it would appear that civil society is filling at least a part of the power vacuumleft as governments have retreated. As representing "the people in themarket-place", civil society is in a position to take a stand against the businesspractices their various movements consider unacceptable. The motives behind the activities of various civil society groups, too, can be questionable. Particularlyin the aftermath of the street riots in Seattle in 1999 that derailed a meeting of theWorld Trade Organization, the aims of the various elements represented in the riots illustratethe contradictory nature of civil society: some were protesting to save jobs in their own, developedcountries; others were protesting at the exploitation of workers in the developing world. The scenario is a fascinating one, and it is, as yet, far from being played out. But, who, and what, is civil society?For the purposes of this discussion, civil society is referred to as the sum total of those organisationsand networks which lie outside the formal state apparatus. It includes the whole gamutof organisations that are traditionally labelled "interest groups"--not just NGOs, but alsolabour unions, professional associations, chambers of commerce, religions, student groups,cultural societies, sports clubs and informal community groups. As such, it embraces organisations whose objectives are diametrically opposed to each other, such as hunting groups andgroups of animal rights activists.[9] "Civil society" can be traced back to the works of Cicero and was developedby political theorists over the past 200 years as a domain parallel to, but separatefrom, the state: a realm in which citizens associate according to theirown interests and wishes.[10]It is a much broader concept than simply non-governmentalorganisations (important though these undoubtedly are). Moreover,the causes pursued by elements within civil society are not necessarilynoble and in the interests of the public good. If one limits civil society tothose actors who pursue high-minded aims, the concept becomes "a theologicalnotion, not a political or sociological one".[11]Many civil society groupsare single-minded in the pursuit of their particular cause and have no interestin balancing their aspirations within the wider public good.[12] A long line of political commentators have commented on the impact of thecivil society participation, on the quality of governance. Alexis De Toquevillecredited the strength of democracy in the US to the proliferation and vigourof "a thousand different types" of associations of citizens pursuing a commonpurpose. A recent study of the relationship between civic participation andgovernance found that in those civic communities marked by active participation in publicaffairs, citizens "expect their government to follow high standards, and they willingly obey therules that they have imposed on themselves."[13] Enhancing the role of civil society in demanding accountability from government "involvesthe most basic questions about power, transparency, participation and democracy".[14]The top-downand closed structure of state-controlled and autocratic governments in many countrieshas, in the past, stunted the growth of civil society and permitted public officials to operate inan atmosphere devoid of public accountability or transparency. The failure of communism and of military dictatorships in Latin America, Asia and Africa toprovide effective governance, protect civil liberties and facilitate social and economic developmenthas begun to transform the political and economic landscapes in countries around theworld. In the public sector, constitutional governments and multi-party democracies haveemerged with the expectation that democracy and deregulated economies will eventually yieldvarious solutions to age-old problems. Among these emerging democracies however, even those officials genuinely seeking solutionshave not always applied the basic principles of democracy. Applying these principles, would,by definition, call for a robust public policy debate, a responsiveness to the demands of citizens,and a receptiveness to the inputs of civil society as solutions are hammered out. Instead,the state has been reluctant to include civil society as a partner. At times, some governmentshave seen it as a rival, both in terms of power and influence, and in terms of the outside aidit diverts from channels which have traditionally been the exclusive preserve of government.Such governments, in ignoring civil society, have failed to implement mechanisms whichwould institutionalise accountability and build public trust. One commentator on the Mexican experience notes that "no one would quarrel with the statementthat a pluralistic public policy debate is crucial to the very existence of a democraticprocess. Developing public policy debate in a society that is gradually building democraticinstitutions, however is a far more complex issue."[15]Adding to this complexity is the fact thatcivil society is also in a state of transition. In what has been called "an unprecedented world-widephenomenon[16]the past two decades have seen a global proliferation of civil societyorganisations working at the grass-roots and policy level in the developing world, promotingdemocracy, human rights, development and other objectives."[17] Donors and policy-makers have come to realise that nascent democratic institutions in transitionalphases are fragile, and that market forces alone are inadequate to ensure social andeconomic equity without the countervailing participation of civil society in the decision-makingprocess. Even so, civil society organisations in developing countries often face difficultiesin securing adequate funding and access to information while retaining independence andavoiding accusations of being foreign-dominated. However, as people increasingly demandgreater participation than that afforded by a voting booth every few years, civil society, inboth developing and developed countries, seems likely to occupy a more central place in thescheme of things than it has the past. And from where, then, does civil society get its legitimacy?Civil society, in essence, gains its legitimacy from promoting the public interest, hence, its concernswith human rights, the environment, health, education, and, of course, corruption. Itsmotivation is a special interest, not personal profit. It is characterised by a strong element ofvoluntary participation: thus people participate because they believe in what they are doing,and not simply for spending another day in the office. This is seen most sharply when one looks at some of the actors within civil society. TradeUnions, for example, see themselves as acting in the public interest--but not always, for therewill inevitably be times when they are pursuing the narrow self-interest of the group they represent.They have, then, one foot in civil society and another out. The same can be said of the private sector. As yet, there is no consensus on whether the privatesector has any place at all within civil society. That members of the private sector areindividually accountable to their shareholders, and to them alone has been a traditionalresponse. However, the growth of social accounting and the recognition that business must, inits own enlightened self-interest, see itself as being a part of the community, and as havingbroader responsibilities than those crudely dictated by a "bottom line", have led many businessleaders to see the role of the private sector as being, at least in part, aligned with civilsociety. The same can be said of professional organisations, particularly doctors, lawyers,accountants and engineers. Critics are on firm ground when they ask "who elects civil society?"--for no-one does. Groupsform themselves, usually around a charismatic figure. Trade Unions' members elect their leaders.Public companies' shareholders elect their directors. There is, however, a particular crisisof legitimacy for NGOs, and they are very much the bread-and-butter of civil society--andoften mistaken for being its totality. Responsible NGOs ensure that they are run democratically and accountably, but it is also truethat many NGOs are run in neither fashion. Indeed, many are formed for the sole intent ofgaining aid funds from donors for the personal benefit of the NGOs' founders. Efforts are underway to foster the adoption of codes of conduct and transparent accounting practices by NGOsto help meet responses to these criticisms. However, the driving force behind NGO reformsshould be the recognition that civil society is in no position to demand higher standards inpublic affairs from its governors, than the standards NGOs themselves are prepared to applyto their own. As Michael Bond concludes in his critique of NGOs, "When they are goodthey are very good: a catalyst for positive change. But when they are bad,they are self-promoting and irresponsible."[18] The role of civil society in countering corruptionCivil society encompasses the expertise and networks needed to address issues of commonconcern, including corruption. And it has a vested interest in doing so. Most of the corruptionin a society involves two principal actors, the government and the private sector. Civil societyis typically the major victim. And as power devolves from the centre to local authorities,opportunities for corruption shift downwards towards new actors who are in more direct contactwith civil society. This means that the ability of civil society to monitor, detect and reversethe activities of the public officials in their midst is enhanced by proximity and familiaritywith local issues. Indeed, this may be the training ground needed to gain the experience andconfidence necessary for action at the national level. Civil society's response to the problem has, in the past, been fragmented. Lawyers may bepoliced by laws and bar associations or accountants by their professional bodies, but fewwithin civil society have taken the broader view: to contemplate what theintegral parts of their society's integrity system can and should look like, andto press for relevant reform against a holistic blueprint. None are without problems. In Australia, for example, free BMWs, cash kickbacksand overseas holidays are said to be just some of the bribes beingoffered by pathology companies to favoured doctors, according to a leadingpathology organisation. The Australian Association of Pathology Practiceshas been calling for a review of corruption laws to stamp out a culture of"creative fraud" within the industry. Its president, Dr Ben Haagsma, is quoted as saying thatalthough corruption was only a minor problem within the industry, new laws that will makeprosecutions easier were needed to encourage doctors to blow the whistle on bribery.[19] It is also important to note that civil society can be a part of the solution or a part of the problem.For example, the business communities have all too often become inured to paying bribesto public officials to gain business.[20]There is a sharp reluctance in many influential quartersto introduce any apparent change in the ground rules that might result in their losing business.The challenge here is to achieve a scenario in which the rules change for all, so that thereare no "winners" and no "losers." The only winner would be society as a whole. A triangular relationship exists between government, capital and civil society. Corruption cantake root in all three parties to the relationship. It is thus both theoretically and in practiceimpossible for just one of the parties to address the issue of corruption on its own and in isolationfrom the other two--and it is arguably impossible to tackle the issue effectively withoutthe participation of all three. Government therefore has a duty to provide a legal and regulatory framework which allowsthe necessary space for civil society to operate, including, of course, freedom of expression,freedom of association, and freedom to establish non-governmental entities. Laws governingthe formal constitution of an NGO and its tax status will vary greatly, but these should beclearly understood, accessible, consistent with international norms, and not needlessly restrictiveor cumbersome. Public officials handling any accreditation procedures should clearlyunderstand that the law must be applied even-handedly, without broad discretionary powers.In this context, any requirement to register is best served where decisions are made by a courtor other independent body. In civil society, there are many people who have a fundamental interest in achieving an effectiveintegrity system for their own countries. And, in a number of countries, members of civilsociety are involved as independent participants on ad hoc oversight boards.[21] Sometimes, if the government does not respond to public concerns, civil society can, and will,organise to defend its essential interests. For example, tired of abuses of power by privatisedmonopolies in New Zealand, a loose-knit group of largely commercial interests has cometogether to create MUMS (Major Users of Monopoly Services) in the absence of legislation coveringmonopoly businesses and their accountability. MUMS oversees interests ranging frominternational airlines and telecommunications activities to pulp-and-paper producers and filmproduction companies.[22] Transparency International's strategy to involve civil societyFrom its inception, Transparency International (TI) argued that governments could not hopeto tame corruption without the help and support of their people--and that the way to buildthis support is through serious-minded NGOs who were prepared to form cooperative butindependent and critical partnerships with their governments. Where there was no suchwillingness in civil society, then the chances were that the government was not seen as beingserious, and that anything it tried would probably fail. In the intervening years, this approach has come to be endorsed by governments, aid agenciesand international institutions, but its impact has necessarily been limited by the fact that inthe countries suffering most acutely from corruption, civil society tends to be very weak. Apriority for TI has been, therefore, to build capacity at the grassroots level. TI has based its approach to fighting corruption on three basic tenets. First, it aims to buildbroad coalitions against corruption by bringing together groups that are expressly non-partisanand non-confrontational. Consultations draw in other relevant segments of civil society--typically business leaders, journalists, religious figures, academics, existing NGOs with sharedaims, members of chambers of commerce and other professional bodies--to test the interestsand feasibility of forming a national chapter. In some instances, well-established NGOs of highpublic standing have amended their constitutions to adopt the TI approaches and then becometheir country's national chapter.[23] The second basic tenet of TI--and its most important structural feature--is the crucial role ofnational chapters. Not only are the TI chapters the "owners" of the TI movement[24], but theyare free to define their own mandates and work programmes. However, they must follow twoimportant rules of conduct: 1) they will not investigate and expose individual cases of corruptionas such activity would undermine efforts to build coalitions which promote professionaland technical improvements of anti-corruption systems; and 2) they must avoid partypolitics as partisan activity would damage TI's credibility.[25] As there are no global recipes against corruption, national chapters tailor anti-corruption programmesto the needs of their own regions. In common with other organs of civil society, TInational chapters have to win the confidence of the country's administration--a task which iseven more difficult in countries where NGOs are generally regarded with suspicion by governmentsbecause of both their access to external funding and their agendas. The third element of the TI strategy is to involve civil society in an evolutionary manner.Rather than arguing for dramatic, sweeping programmes that attempt to cleanse the stables ina single onslaught, TI argues for achievable and highly specific plans of action in a step-by-stepprocess towards problem solving. For example, the prevalence of corruption can dishearten individual firms or even nationsfrom taking the first step to end the practice. When everyone pays bribes, no one wants to bethe first to stop and end up empty-handed. To counter this, TI has developed an approach ithas called "Islands of Integrity," where in a specific project, all parties enter into an IntegrityPact (or Anti-Bribery Pact).[26] The "Islands of Integrity" approach is also being developed in areas of government activitywhich are particularly susceptible to corruption (e.g. revenue collection). In such cases, it canbe feasible to hive off the department concerned, ring-fence it from other elements in the publicservice, pay the staff properly, and have officials raise their standards. TI is also developing the catalytic approach of building " integrity networks." These involve asmall number of individuals encouraging relevant existing NGOs to coalesce around theintegrity issue, act collectively to project the issue in a broad and holistic framework, andidentify possible steps for action. Some of the most dramatic work to date has been undertaken by chapters who have undertakensurveys which have highlighted deficiencies in service delivery, and even gone so far asto successfully challenge the prices being paid for goods and services, driving these down andimproving services as a consequence. Monitoring privatisations has been accomplished successfully,and in circumstances (e.g. a single bidder for a telephone company) which wouldhave given rise to public suspicions had the chapters not been involved. Others have conductedsurveys to document where in the public service the core of the problem really lies, andthese have helped to raise public awareness and to elevate the fight against corruption on thenational political agenda. The above few examples highlight the role that civil society can play in strengthening ethicalpractices--especially where such practices mesh with the private and public sectors. Lessonslearned from the above scenarios, and from others too numerous to mention, tend to suggestthat the role of the citizen lies more in the field of prevention and information supply, than inthe actual enforcement of anti-corruption laws. In other words, the real role must be for civil society to claim and defend its own core values,and not leave this integral function to those in power. Some indicators for Civil Society
Legal profession
Accounting/Auditing profession
Medical profession
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