Corruption is social progress’ greatest obstacle

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In June the 2016 Social Progress Index was released. This Index provides a holistic view of what really matters to people. The Index covers the things that are rarely revealed by economic data- access to electricity, health, property rights, and religious tolerance.

As I scanned the 52 indicators that make up the Index I was caught by one in particular – corruption. 

{mosads}Corruption should, of course, be included in the Index. It directly impacts on peoples’ lives, particularly the most vulnerable in society. But it’s also unique. Corruption matters because of its corrosive effect on all areas of human wellbeing. It alone has the potential to erode every other area of social progress and in a variety of ways.

This is in part what makes corruption such a difficult challenge to solve. And why it is so critical that we do.  How does corruption harm other aspects of social progress? I believe there are three ways it can impact different areas of human wellbeing:

1)      It makes things more expensive

This is the most obvious impact of corruption. Rent-seeking by public officials makes infrastructure and public services much more expensive for citizens, as their resources are siphoned off for personal gain.  And it can be very expensive.  A report by Transparency International found that corruption increased the cost of achieving the UN Millennium Development Goal on water and sanitation by US $48 billion[1].

Governments have limited funds. Corruption on this scale meant that many citizens in the poorest countries went without clean water or sanitation as a result of fraudulent leaders in government and business.

With the United Nation’s new Global Goals having launched only last year, it is important to reflect just how much more expensive they will be to achieve if systemic corruption is not tackled.

2)      It undermines the regulations that keep people safe 

Another challenge posed by corruption is that it allows the bending of rules and legislation designed to protect people and the environment. How? Take traffic deaths, a bigger killer than malaria in many African countries[2] (as well as component in the Social Progress Index). This partly is the result of poor infrastructure and limited resources for policing. But it is also the result of licences granted and road crimes not reported because of bribery.

Corruption’s loosening of regulations also harms the environment. Research has found that corruption, through weak regulations and enforcement, leads to worsened environmental outcomes including increased emissions, higher rates of deforestation, and increased depletion of natural resources[3].

3)      It reduces people trust in public institutions and services  

Perhaps the most insidious effect of corruption is the slow erosion of public trust in government and wider society. While the process maybe invisible the evidence is clear.

Parents do not send their children to school where corruption is rife[4]. Poorer citizens will avoid public healthcare if the cost of a vaccination or a treatment is a bribe they cannot afford. Mistrust of public health workers may have even played a role in the scale of the recent Ebola outbreak[5].Where corruption is endemic those who most need government help will avoid the institutions designed to improve their education and health.

Too often discussions about corruption are abstract or academic. This is hardly surprising given the complexity of the topic.

But it’s important to remember the very real impact it has on the most vulnerable in society.

Just in the examples listed above we see that corruption means less provision of water and sanitation, less protection of the environment, more traffic deaths, and fewer children in schools and fewer citizens receiving health care – areas that are critical social progress. 

The Social Progress Index is unique in that it gives us a holistic view of the wellbeing of society, highlighting particular strengths and weaknesses in individual countries. In this way it acts as a road map to guide policy makers and business leader’s investments, resources and collaborations. 

But where corruption is rife, tackling it is critical to making headway on any social challenges. Where rent is extracted, bribes taken and rules bent social progress is likely to disintegrate.

Last month I attended 2016 Anti-corruption Summit in London where Deloitte signed a joint statement of support with 30 other professional services firms to help eradicate corruption. It is a start. But we must partner beyond the private sector – working with government and civil society will prove critical to the success of any anti-corruption initiative.

Corruption may be differentiated in its broad impact on social progress. But it is also distinguished in its reliance on partnerships to succeed.

Only together can corruption be made a thing of the past, removing perhaps social progress’s greatest obstacle.

James “Chip” Cottrell is a US Partner with Deloitte Advisory


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