Companies, accountability, corruption. Understanding things to change them
Institutional Communication Service
11 April 2022
The popular initiative "For Responsible Businesses - Protecting Humans and the Environment" was filed in Switzerland in 2016. The initiative called for the Federal Government to adopt legal measures to oblige companies to respect human rights in Switzerland and abroad. However, the Parliament recommended that the people and the cantons reject the initiative, adopting an indirect counter-proposal that then came into force. Almost six years later, we want to take stock of the situation, questioning whether or not Switzerland respects human rights and the environment. We do so with the help of Jean-Patrick Villeneuve, Associate Professor of Public Administration and Management at Università della Svizzera italiana.
For decades, corporate responsibility on the social and environmental consequences of economic activities worldwide has been the subject of national and international debate. The UN in 2011 drafted the Guiding Principles for Business and Human Rights. Where do we stand?
In theory, most people agree that institutions, public or private, should respect common rules and regulations, notably when it touches fundamental values such as human rights, the environment, minorities, justice and so on. Swiss legislation is pretty straightforward and contemplates an effective sanctioning mechanism, and organisations know the game's rules. Institutions regularly operate across national and jurisdictional borders in an increasingly globalised economy.
With the help of my research team, through a project funded by the Swiss National Science Foundation we analyse how Swiss companies operating abroad deal with the problematic aspect of corruption. We focus in particular on how companies identify instances of corruption, how they deal with them, and how they develop strategies to counter this phenomenon. We also try to understand how this all squares with the legal and institutional framework of their home country, Switzerland. I believe that to change things, one must understand them, and this project is a step forward in this direction.
Today we are faced with an unprecedented sense of global responsibility. How should Switzerland behave?
One of the approaches taken to address these challenges has been the development of the United Nations' Sustainable Development Goals, the so-called SDGs. A sort of road map that serves as a solid, albeit imperfect, formalisation of these imperatives. The list includes Goal 16, Peace Justice and Strong Institution, which aims to promote peaceful and inclusive societies oriented towards sustainable development, ensure access to justice for all, and build effective, accountable and inclusive institutions at all levels, especially by countering corruption in public and private organisations.
Switzerland plays a crucial role in this area as one of the key countries where discussions and negotiations are held. But, as a wealthy developed country, it also has to set an example, and knowledge and analysis are required to do this. With my team, we are studying how international institutions engage citizens in decision-making. In a project funded by the Swiss Network for International Studies (SNIS), we examine the global trading system, its actors, and how to interact to ensure the development of better policies.
How can we make Swiss companies act responsibly abroad?
One of the main aspects of dealing with international realities is to have reliable and clear information. It is necessary to have information in order to act. Additionally, and maybe even more important, is that by disclosing information and being transparent about situations (on human rights, on environmental responsibilities), we believe that countries and institutions, public and private, will be further pushed to act correctly. It is one thing to abuse the rules when no one knows, quite another to abuse rules when everyone ‘sees’ you.
The governance agenda has moved in this direction in recent years. Institutions such as the Open Government Partnership and Transparency International (both partners in my research projects) have pushed for more open and transparent dynamics. The aim is to know what governments and private companies are doing and hold them more accountable.
When talking about companies operating abroad, how can corruption be prevented?
Aside from the illegal conduct of companies that abuse national laws or take advantage of a weak judicial system, typical of poorer countries, all stakeholders see corruption as a real threat: a problem that generates costs, legal uncertainties, and competitive tension. One of the solutions that all players would like to have is a clear and unambiguous system of rules with a solid and effective implementation mechanism. Unfortunately, this is not the case at the international level. Corruption becomes even more problematic when an organisation deals with multiple jurisdictions that might generate similar issues, all with their own specific complexities. Corruption is a clear cost for companies and society. A project funded by the Social Sciences and Humanities Research Council of Canada (SSHRC) examines the institutional costs of dealing with corruption, particularly the impact of corruption on citizens' trust in the government, satisfaction with its services, and democracy itself.
One way of addressing corruption issues and other types of fundamental abuses is by making institutions more open and transparent and ensuring that diverse voices are heard at the social level. Addressing corruption and human rights abuses also passes through a more active and energised democracy. We recently completed a research project with Innosuisse, in which we analysed a specific model of civic engagement. The idea is to go "beyond the ballot box", making sure that citizens beyond having a voice in electing officials, they also have an active role in the definition of policies and in shaping political proposals.
Ultimately, it is up to us, citizens, to ensure that our public institutions provide a solid and robust framework in this direction. In universities, our role is to analyse and evaluate how this can be achieved and to identify the drivers and mechanisms for a more democratic, open, transparent, and accountable society.
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