World Economic Forum Workshop Session: Integrating Risk Mitigation and Capacity Building Use of Information and Assessments The Public Integrity Index: Assessing the Rules of the Game Marianne Camerer Director, Global Integrity

Corruption as Risk Creates uncertainty by Interfering with “the rules of the game” Undermines growth and development through hindering or deterring foreign and or local investment Undermines growth and development through hindering or deterring foreign and or local investment Affects the quality and composition of public expenditure projects Affects the quality and composition of public expenditure projects Undermines the fiscus through non-optimal collection of taxes and revenues as the unofficial underground economy flourishes Undermines the fiscus through non-optimal collection of taxes and revenues as the unofficial underground economy flourishes Distorts policy and resource allocations, thereby increasing inefficiency Distorts policy and resource allocations, thereby increasing inefficiency (From expert testimony in Lesotho and South Africa on the impact of corruption on developing economies)

Corruption as Risk Creates uncertainty by Interfering with “the rules of the game” Undermines trust and credibility in institutions and procedures Undermines trust and credibility in institutions and procedures Introduces unjust access to often limited social and political goods and services, potentially creating social and political unrest Introduces unjust access to often limited social and political goods and services, potentially creating social and political unrest corruption takes its greatest toll on the poor; and corruption takes its greatest toll on the poor; and corruption bites into the moral fibre of society. corruption bites into the moral fibre of society. (From expert testimony in Lesotho and South Africa on the impact of corruption on developing economies)

Corruption in the news Brazil Investors take fright as Brazilian scandal flares up Financial Times, 16 June 2005 By RAYMOND COLITT Investor sentiment in Brazil again turned sour yesterday as fresh testimony rekindled concern over corruption allegations against the ruling Workers' party (PT). In early trading the Sao Paulo stock exchange had fallen by as much as 3 per cent, reversing its trend for the third time in less than 24 hours. "Initially the market thought the scandal was fading but there are enough unanswered questions to keep this crisis bubbling for some time to come," said Marcelo Mesquita, chief strategist with UBS in Rio de Janeiro. South Africa Wolfowitz pays tribute to Mbeki He said the new leadership in South Africa, and leaders of other African countries, were intent on fighting corruption. “We have recognized that in the past a lot of governments in Africa did not spend money well. There is a new leadership now that is taking responsibility to get rid of corruption. Africa is on the move”. ( 20 June 2005)

Global Integrity Report An investigative report tracking corruption, openness and accountability in 25 countries Released 29 April 2004, National Press Club, Washington DC

The Global Integrity Report Components Public Integrity Index Public Integrity Index –Generated by data collected in-country on the Integrity Indicators 25 Country Reports 25 Country Reports  Country Facts  Corruption Timeline  Corruption Notebook (reader comments)  Integrity Assessment (reader comments)  Integrity Scorecard  Integrity Indicators (score, comments, reference, reader comments)

Global Integrity Countries COUNTRIES: Argentina, Australia, Brazil, Germany, Ghana, Guatemala, India, Indonesia, Italy, Japan, Kenya, Mexico, Namibia, Nicaragua, Nigeria, Panama, the Philippines, Portugal, Russia, South Africa, Turkey, United States, Ukraine, Venezuela, Zimbabwe

Measuring (the other side of) Corruption: Assessing the rules of democratic governance By its nature, corruption is almost impossible to measure with any degree of accuracy. By its nature, corruption is almost impossible to measure with any degree of accuracy. It is however possible to assess the laws, mechanisms, institutions that prevent abuses of power. It is however possible to assess the laws, mechanisms, institutions that prevent abuses of power. I.e. the Public Integrity Index is a measure of the national anti-corruption architecture I.e. the Public Integrity Index is a measure of the national anti-corruption architecture

The Public Integrity Index measures: Existence of institutional mechanisms that prevent abuses of power (i.e. corruption) Existence of institutional mechanisms that prevent abuses of power (i.e. corruption) Effectiveness of these anti-corruption mechanisms that promote public integrity Effectiveness of these anti-corruption mechanisms that promote public integrity Citizen access to public information to hold public officials accountable Citizen access to public information to hold public officials accountable

Constructing the Public Integrity Index: 6 Governance Categories (based on anti-corruption and governance literature) I. Civil Society, Public Information and Media Civil Society Organizations; Access to Information; Freedom of the Media II. Electoral and Political Processes National Elections; Election Monitoring Agency; Political Party Finances III. Branches of Government Executive; Legislature; Judiciary IV. Administration and Civil Service Civil Service Regulations; Whistle- Blowing Measures; Procurement; Privatization V. Oversight and Regulatory Mechanisms National Ombudsman; Supreme Audit Institution; Taxes and Customs; Financial Sector Regulation VI. Anti-Corruption Mechanisms and Rule of Law Anti-Corruption Law; Anti-Corruption Agency; Anti-Corruption Agency; Rule of Law and Access to Justice; Law Enforcement

Integrity Scorecard South Africa Very strong tier: Category 5 Strong tier: Categories 1, 3, and 6 Weak tier: Categories 2 and 4 Overall, South Africa ranks 6th out of 25 countries on the Public Integrity Index, falling into the “strong” category.

The Future Vision To refine, repeat and expand the study to include countries (eg. MCA/IDA) To refine, repeat and expand the study to include countries (eg. MCA/IDA) To create an independent non-profit entity to continue this work To create an independent non-profit entity to continue this work To analyze, communicate and publicize the data and findings more effectively To analyze, communicate and publicize the data and findings more effectively To diagnose and encourage reforms based on the findings To diagnose and encourage reforms based on the findings