Monday, December 15, 2003

EDC ranks poorly in Anti-Corruption Index

Crown Corporation says it is satisfied with safeguards in place, new Report indicates it should not be.

Ottawa, December 15, 2003 – Export Development Canada ranked 15th among 28 OECD countries in terms of measures it has taken to deter and sanction bribery, a report by the Trade Union Anti-Corruption Network (UNICORN) revealed today. Export credit agencies (ECAs) from Austria, Denmark, and Australia topped the list.
 
“As primary supporters of international business, ECAs have a vital contribution to play in international efforts to eradicate bribery,” said Roy Jones, of the Trade Union Advisory Committee. “But many governments, including all G7 countries, are still a far cry from making this vision a reality.”

Although the G7 ECAs outperformed other OECD members in terms of informing companies of the legal consequences of corruption and requiring them to sign a no bribery declaration, they fared less well on transparency around commissions and agents, and taking actions to sanction companies found guilty of corruption. EDC, for example, does not require details of commissions to be provided, and applies a ceiling of 10% on these commissions, rather than the 5% recommended by the report. Like five other G7 ECAs, EDC also has the option to debar a company convicted of bribery before a decision to support it is made, but the report says that it, like all other G7 ECAs, chooses not to do so.

“This report will hopefully be a wake-up call to EDC and others”, said Fraser Reilly-King, Coordinator of the NGO Working Group on EDC, “that being tough on corruption isn’t about having the right policies in place, it is about acting on them when the occasion arises.”

In August 2003, Canadian Acres International was found guilty of corruption in the Lesotho Highlands water project. Although EDC was not involved in the project, it has since reviewed past transactions and the procedures that Acres have put in place, and has said it is satisfied with both the safeguards Acres has implemented, and with its own anti-corruption program. The report, however, recommends that EDC upgrade its procedures, and sanction such companies.

According to the report, eight ECAs, including Hungary and Greece, would debar companies from future support in light of a conviction for bribery.

The report was based on an OECD survey of member’s anti-corruption policies, and can be found on-line at http://www.tuac.org/ or on the UNICORN web site at http://www.againstcorruption.org/reportindex.asp . A brief on the report is overleaf.

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For further information, contact:

Roy Jones, Trade Union Advisory Committee to the OECD, Tel: +33 1 55 37 37 37

Fraser Reilly-King, NGO Working Group on EDC, Tel: (613) 266-8100