Corporate Watch -- By Amelia H.C. Ylagan

Like Caesar

Posted on January 17, 2011

Realistically, it might be quite difficult to convince private business that it must be like Caesar’s wife -- always above suspicion and reproach. The reason is that being what it often is -- the arbiter between the government and the people when it concerns economic well-being -- Private Business IS the powerful Caesar.

Indeed, the private sector of the economy must consciously acknowledge that the conduct of business directly affects the well-being and growth of the national economy more than any policy directions or regulatory constraints that government may impose. For there can be laws and levies, but private business can be prudishly compliant and submissive on one extreme, "avoid" constraints in various schemas still within the law in a judicious middle ground, or be "creative" and altogether actively corrupt government and themselves in fallacious end-justifying-the-means for profit. Thus can corruption thrive indeterminately.

Can we Filipinos live with a widely believed 40% (alleged estimate as at previous administration) of our national budget going to corruption? Some observers say that there is still close to that scandalous percentage persisting today, for corruption is deep-rooted. But the private sector cannot singularly condemn government for corruption and think itself blameless. It cannot wash its hands like Julius Caesar who denied his wife Pompeia the crucial honest alibi for the judgment of her accused rapist. "My wife ought not even to be under suspicion," he said, and promptly divorced her. Some historians say that Caesar married Pompeia for status and power, for she was the granddaughter of the Roman dictator Lucius Cornelius Sulla, victor of the Great Civil War of the ’80s BC. The alleged attempted rape was Caesar’s chance to junk Pompeia (his second wife) apr├Ęs her usefulness, after he had become politically entrenched. Surely the private sector in a small developing country cannot be as exploitive as Caesar was accused of.

There lies the pressure for the private sector to be honest in its workings -- to be just and fair to the country and to the people by doing its part at whittling at that supposed 40% cost of corruption. The The Wall Street Journal (TWSJ)/Heritage Foundation’s 2011 Index of Economic Freedom cited "a culture of corruption [that] is long standing" giving a freedom from corruption score to the Philippines (PH) of a low 24 points, versus the average score of 40.5 points for the 179 economies ranked. Transparency International (TI), a global civil society organization leading the fight against world corruption, gave the country 2.4 points out of 10 in its 2010 ranking, placing the Philippines 134 with Bangladesh, Nigeria, Ukraine, and four other small nations sitting close to the most corrupt among the 178 countries reviewed. This notoriety is not good for the country, and certainly not good for business, especially in terms of global competitiveness.

The Institute for Management Development (IMD) ranked the Philippines number 39 in its 2010 list of 58 economies according to global competitiveness. The Asian Institute of Management (AIM) Policy Center, IMD’s local partner, called it "the Philippines’ best performance since its inclusion over a decade ago, [however] the result was still short of the top third placing local authorities claimed could be achieved by 2010." Being in the lower third of countries surveyed (Singapore is number one, with a perfect score of 100), the Philippines was held back by "lack of progress in business efficiency and infrastructure" and challenged with weak implementation of laws amidst faltering faith in public institutions. Other shortcomings were noted in food and energy security, planning for national disasters and climate change, entrepreneurial and job security and city congestion. The report did not seem to emphasize enough the most basic governance concerns of corruption in government and the private sector as main deterrents to competitiveness.

The National Competitiveness Council (NCC), which was formed in 2006 by an angry then-President Gloria Arroyo to investigate causes of the country’s non-competitiveness, has not come up with a fearless public admission to the apparent direct correlation between graft and corruption and at least the risk and cost of doing business in the Philippines. It is rightful indignation for citizens that breaches of honesty and integrity in government have been gobbling the common opportunities for the country’s development and the hoped-for improvement of the quality of life for Filipinos. The miscreants of the immediate past decade of blotched governance have yet to be made accountable to the people. The majority of voters who installed President Benigno Simeon Aquino III as redeemer of the nation from the noxious environment of graft and corruption are waiting for the promised clean-up of government and the prosecution of public officials and their private accomplices to crimes against the Filipino.

The Makati Business Club (MBC), a local private non-stock, non-profit business association focuses on "the role of the private business sector in national development efforts, both in the planning and to foster and promote implementation of policy." Its new executive director, Peter Perfecto, announced in newspapers last week that "anti-corruption efforts -- this time directed toward the private sector -- will be added to the MBC’s priorities. We will continue to watch government but also watch the business sector and get them to make integrity commitments, especially with the big public-private partnership projects coming up." Under the "Integrity Initiative,"a joint project of the MBC with the European Chamber of Commerce, local firms will pledge to ban bribes, conduct ethics training, and improve the transparency of financial reporting.

The best of good wishes for the good intentions of the MBC and like business organizations who will take the lead in the fight against graft and corruption in Philippine business. Best to lead by good and clean example, above reproach and suspicion. Like Caesar’s wife.