Remarks at the Transparency International-USA's Annual Integrity Award Dinner
Secretary of State
I want to thank Alan for his years of service to our country and the foreign service; thank you so much. I want to thank you Claudia for assuming the reins of this very important organization. And I, of course, want to congratulate Coca-Cola. And Sonya, thank you for that very stirring description of the commitment that Coca-Cola has to the values represented by Transparency International-USA.
I know that the former – the predecessor to Claudia Dumas is Nancy Zucker Boswell who was just recognized, and I have a special reason for recognizing her again because she is here with her husband, Eric, who also happens to be the Assistant Secretary for Diplomatic Security at the State Department. So don’t try any funny stuff because Eric and his team are well-prepared. But I wanted to thank both of them for their service.
As you heard Sonya say, she was really accepting the award on behalf of the 700,000 associates of Coca-Cola. Well, I am accepting it on behalf of the people across the United States Government, not only from the State Department and USAID but from Treasury, from Commerce, from the SEC, from Justice – represented by our Assistant Secretary for Criminal Law, from representatives to the OECD, the United Nations, the G-20, and so many other dedicated public servants who serve you by waking up every single morning trying to figure out what more we can do to reduce corruption, to create transparency, accountability, and better governance. They will never receive an award like this and their names are not likely to be known. But they are fighting the fight day in and day out.
Now Al said we have made this a high priority, and indeed we have. We’ve tried to put it right at the center of the work that we do in diplomacy and development. And why? Well, very simply, we have an interest in reducing poverty and sparking economic growth around the world, in creating greater security, prosperity, and even peace. And we know that corruption and the lack of transparency eats away like a cancer at the trust people should have in their government, at the potential for broad-based, sustainable, inclusive growth. Corruption stifles entrepreneurship, siphons funding away from critical services, poor fiscal transparency makes it impossible to hold governments accountable. And if these problems go on long enough, if they run deep enough, they literally can and have been shaking societies to the core.
The vegetable vendor that Al mentioned certainly is a prime example of that. But we so much evidence of the increasing awareness and rejection by people of the corruption that has been for the millennia just taken for granted.
Anyone who doubts the power of frustrated citizens to rise up need not only look at the Middle East and North Africa, but increasingly across the globe because social media has given every citizen a tool in order to report and literally post in the matter of seconds the kind of abuses that have been, up until now, just taken for granted. So this is an integral part of national security.
We also know that corrupt practices contribute to the spread of organized crime and terrorism. They underwrite trafficking in drugs and arms and human beings. And we have a major stake in building up partners who can work with us to take on these transnational threats and to promote stability, who will work with us to champion an international standard of behavior that gives more people in more places the opportunity to fulfill their own God-given potential.
The second priority for us is that the United States needs to spark growth not only abroad but right here at home. I’ve often spoken about what I call economic statecraft. It’s how America’s foreign policy can be the best advocate for U.S. businesses abroad, which will in turn drive our own recovery, and so we are seeking ways to more effectively use economic tools to strengthen America’s global leadership.
American workers and businesses remain the most innovate and productive anywhere in the world. I believe they – we can compete with anybody, anywhere, but it’s very difficult to do that if you don’t have that proverbial playing field being level so that your competition has a shot of winning.
And I know that with all of the businesses represented here tonight, you understand how unfair it is when competitors pay the bribes, pass the money under the table, prey on public officials in other countries to force or extort them to do their bidding. And oftentimes, it prevents American businesses even from making investments in certain places where clearly they should have a competitive advantage.
Now, of course, for every one of those officials who are taking cash under the table just to do his or her job, there are many who are refusing. There are leaders of integrity who are trying to look powerful people in the eye and say, “No.” But they need our admiration, but more importantly, our support.
So we have made it a priority to fight corruption and promote transparency, and the United States has been at this for quite a number of years now. In 1996, the United States played a major role in developing the first legally-binding commitment by governments to fight corruption. And we’ve led on many important fronts since then. But I’d like to just briefly describe what this Administration is doing.
First, we’re expanding and mobilizing a global consensus in support of greater transparency – a global architecture, if you will, of anticorruption institutions and practices. Along with Brazil, we launched the Open Government Partnership. It is a network of support for government leaders and citizens working to bring more transparency and accountability to governments.
Already, it’s helping to shape best practices like Indonesia’s innovative method of involving even small villages in decisions about how government funds should be spent. All told, 53 countries and dozens of civil society organizations are committing to these efforts. And I know that many of TI’s country offices, including TI-USA, will be represented at the Open Government Partnership high-level summit in Brasilia that I will co-chair with the Brazilian foreign minister.
We’re building this anticorruption consensus in other ways as well. In what is called the Deauville Partnership, we are working with our Arab partners on anticorruption, open government, and asset recovery efforts. At the OECD, we were pleased to welcome Colombia and Russia into the Working Group on Bribery last year. It will be an important milestone when both have become full parties to the Anti-Bribery Convention.
Now we know business cultures do not change overnight, but moves like this at least establish beachheads for reform. And through our bilateral diplomacy and at the G-20, we are encouraging major economies such as China, India, Indonesia, Saudi Arabia to join the convention as well. We support the follow-through that’s necessary to enforce anticorruption norms such as the new review process that promotes implementation of the UN Convention against Corruption.
Yet even as we work to build this international consensus and the tools to implement it, we recognize that there’s a lot of work ahead. How do we produce the concrete changes in people’s lives? So we’re working to help countries build institutions and create tools to promote good governance. Now sometimes it’s as simple as cutting down the opportunities for an official to exact a bribe in the first place – for example, by reducing the number of forms you have to fill out, or by encouraging countries to move toward e-Government, electronic government. In Afghanistan, officials have cut down markedly on corruption by paying members of the national police force by mobile phone instead of by cash.
In many countries, we have seen a lot of the security difficulties with their militaries and their police forces, due, in large measure, because the members either don’t get paid at all or get paid sporadically or get paid less than they should because large amounts of cash are transported, and every officer along the line takes his share. So we’ve been pushing militaries and police forces to move to mobile banking as a way to combat that.
Next month, we will launch an innovative fund to encourage countries to be more open about how they spend their revenues. It’s part of a larger effort we’re calling Domestic Finance for Development, an initiative to help developing countries increase their own sources of funding so they can meet more of their own needs. It’s really quite difficult in many countries when we see that they either don’t have any modern tax system or they don’t collect what is owed with the result that they are often unable to meet the most basic needs of their own people.
And so we’re trying to help not only governments, but civil societies get the tools and training needed to hold their governments accountable. I’ve been working for three years to try to improve tax systems and collection efforts in a number of countries, and I was very impressed with the quick work that President Perez Molina in Guatemala has shown in creating a tax system aimed at beginning to collect taxes from the elites in that country.
Corruption is a key focus for our strategic dialogue with civil society, and we encourage them to get educated about what more they can do. When I was in Kenya in August of 2009 and I spoke at the University in Nairobi, I was very struck by a sign at the entrance to the university which read, “You are entering a no-corruption zone.” And the young people who we’ve been working with in Kenya and elsewhere have made efforts against corruption one of the centerpieces of their organizing politically.
Finally, because our credibility depends on practicing what we preach, we are trying to up our own game. We recently announced our intention to implement the Extractive Industries Transparency Initiative in the United States, which will require disclosure of payments made by companies to the government and of payments received by the government from companies. Additionally, the Cardin-Lugar Amendment requires extractive industry companies registered with the SEC to disclose, project by project, how much they pay foreign governments. Now I know this has been a difficult issue, and the SEC is still working on the regulations, but we do think it will have a very profound effect on our ability to try to help manage some of the worst practices that we see in the extractive industry and in the relationships with governments at local and national levels around the world.
We’ve also launched groundbreaking efforts to make our development work more transparent. Go to the website foreignassistance.gov, because there, you can see where we are investing our development funds, and you can see that we are very committed to the global effort known as IATI to report our data in a timely, easy-to-use format.
And of course, this Administration, like those before us, has taken a strong stand when it comes to American companies bribing foreign officials. We are unequivocally opposed to weakening the Foreign Corrupt Practices Act. We don’t need to lower our standards. We need to work with other countries to raise theirs. I actually think a race to the bottom would probably disadvantage us. It would not give us the leverage and the credibility that we are seeking.
So we’re looking to approach the issues that all of you here tonight are both interested in and committed to, and it does take everyone working together and it does take a lot of persistence and perseverance, but I am absolutely confident that we will make progress. We are so aided by social media now. We have tools at our disposal in the hands of literally billions of people that were never even dreamed of before. And we have worked through our 21st Century Statecraft Initiative to get those tools into the hands of more people to make them more usable, to encourage channels for people to be able to report corrupt practices – anonymously if necessary – as well as criminal activity of other sorts.
So we know old habits die hard. Human nature is what it is. But we think we have the potential to make even greater progress in the years ahead, and I’m very grateful to all of you and pledge that we will continue working closely together. Thank you very much. (Applause.)