Anti-corruption Glossary

Corruption comes in many forms, and there are many ways to challenge it. Let me share with you some definitions so that we are on the same page when it comes to corruption, or better anti-corruption:

Access to information/Right to information - The right by law – often through freedom of information legislation (acts or laws) – to access key facts and data from the government and any public body based on the notion that citizens can obtain information which is in the possession of the state. Hopefully soon in the Philippines.

 Accountability - The concept that individuals, agencies and organizations (public, private and civil society) are held responsible for reporting their activities and executing their powers properly. It also includes the responsibility for money or other entrusted property.

Bribery -  The offering, promising, giving, accepting or soliciting of an advantage as an inducement for an action which is illegal, unethical or a breach of trust. Inducements can take the form of gifts, loans, fees, rewards or other advantages (taxes, services, donations, favors etc.).

Why it matters? Governments need to take effective action in the fight against international bribery both at the national level and through international groups including the G20, European Union, UN and the OECD. All national legislation should outlaw bribery between firms in the private sector. Governments should fully implement and enforce laws criminalizing bribery. In the Philippines, bribing in the private sector should be criminalized!

Collusion - A secret agreement between parties, in the public and/or private sector, to conspire to commit actions aimed to deceive or commit fraud with the objective of illicit financial gain. The parties involved often are referred to as ‘cartels’.

Compliance - Refers to the procedures, systems or departments within public agencies or companies that ensure all legal, operational and financial activities are in conformity with current laws, rules, norms, regulations, standards and public expectations.

Why it matters? Corporations must be held responsible for actions of their employees, agents, foreign subsidiaries and for lack of adequate supervision of compliance programs. Compliance management will have to be substantially strengthened in all kinds of organizations!

Conflict of interests - Situation where an individual or the entity for which they work, whether a government, business, media outlet or civil society organization, is confronted with choosing between the duties and demands of their position and their own private interests.

Corporate Governance - Procedures and processes for how private sector organizations are directed, managed and controlled, including the relationships between, responsibilities of and legitimate expectations among different stakeholders (Board of Directors, management, shareholders, and other interested groups).

Corruption - The abuse of entrusted power for private gain - corruption can be classified as grand, petty and political, depending on the amounts of money lost and the sector where it occurs.

Disclosure - Provision of information as required under law or in good faith, regarding activities of a private individual, public official, company or organization. Information can include a political candidate’s assets, a company’s financial reports, an NGO’s donors or a whistleblower’s accusations.

Embezzlement - When a person holding office in an institution, organization or company dishonestly and illegally appropriates, uses or traffics the funds and goods they have been entrusted with for personal enrichment or other activities.

 Extortion - Act of utilizing, either directly or indirectly, one’s access to a position of power or knowledge to demand unmerited cooperation or compensation as a result of coercive threats.

Why? Responsible business leaders know that bribe payments cannot be turned on and off. Once a company bribes it can no longer maintain the position that it does not pay bribes and sets itself up for continuing extortion. There should be independent reporting channels to allow companies that have been victims of extortion to report the crime.

Facilitation Payments - A small bribe, also called a ‘facilitating’, ‘speed’ or ‘grease’ payment; made to secure or expedite the performance of a routine or necessary action to which the payer has legal or other entitlement.

All companies must cease making facilitation payments immediately. Companies must recognize these as bribes and prohibit them. All companies must report on their policy on facilitation payments as part of their transparent reporting on their anti-corruption programs.

Fraud - To cheat - the offence of intentionally deceiving someone in order to gain an unfair or illegal advantage (financial, political or otherwise). Countries consider such offences to be criminal or a violation of civil law.

Lobbying - Any activity carried out to influence a government or institution’s policies and decisions in favor of a specific cause or outcome. Even when allowed by law, these acts can become distortive if disproportionate levels of influence exist – by companies, associations, organizations and individuals.

Why it matters? When undertaken with integrity and transparency, lobbying is a legitimate avenue for interest groups to be involved in the deliberative process of law making. When lobbying is non-transparent and unregulated, problems arise and measures must be taken to ensure its accountability and openness.

Money Laundering - Money laundering is the process of concealing the origin, ownership or destination of illegally or dishonestly obtained money by hiding it within legitimate economic activities to make them appear legal.

Nepotism - Form of favoritism based on acquaintances and familiar relationships whereby someone in an official position exploits his or her power and authority to provide a job or favor to a family member or friend, even though he or she may not be qualified or deserving.

Political Contribution - Any contribution, made in cash or in kind, to support a political cause. Examples include gifts of property or services, advertising or promotional activities endorsing a political party, and the purchase of tickets to fundraising events.

Political Corruption - Manipulation of policies, institutions and rules of procedure in the allocation of resources and financing by political decision makers, who abuse their position to sustain their power, status and wealth. 

State Capture - A situation where powerful individuals, institutions, companies or groups within or outside a country use corruption to influence a nation’s policies, legal environment and economy to benefit their own private interests.

Tax Evasion - Tax evasion is the illegal non-payment or under-payment of taxes, usually by deliberately making a false declaration or no declaration to tax authorities – such as by declaring less income, profits or gains than the amounts actually earned, or by overstating deductions. It entails criminal or civil legal penalties.

Transparency - Characteristic of governments, companies, organizations and individuals of being open in the clear disclosure of information, rules, plans, processes and actions.

As a principle, public officials, civil servants, the managers and directors of companies and organizations, and board trustees have a duty to act visibly, predictably and understandably to promote participation and accountability and allow third parties to easily perceive what actions are being performed.

Whistleblowing - Making a disclosure in the public interest by an employee, director or external person, in an attempt to reveal neglect or abuses within the activities of an organization, government body or company (or one of its business partners) that threaten public interest, its integrity and reputation.

 Why does it matter? Companies and organizations should empower whistleblowers who experience or witness bribery and corruption through effective whistleblower policies and procedures.