Anti-corruption strategies in foreign aid: From controls to results

William Savedoff
2016

Summary

This paper argues that efforts to address corruption – targeting funder integrity, recipient integrity and global support – have proven to be largely ineffective against corruption and had a limited impact on development results. It highlights how current approaches rely primarily on transactional controls and, to a lesser extent, on investments in transparency and raising global standards of governance. A more coherent anti-corruption strategy would focus on results; combining the current focus on means within the context of ends and draw more heavily on data.

Since the early 1990s, the international community has pursued a growing number of anticorruption activities under three broad categories of action:

  1. Bilateral and multilateral agencies have undertaken a series of measures to improve their integrity as funders. Over the last 25 years, bilateral agencies have mostly built upon and strengthened their existing institutions – based on their domestic public financial integrity institutions – through regulation, training, peer reviews, and improved coordination.  MDBs have initiated a number of changes to their elaborated systems aimed at building institutions and procedures with the adoption of whistleblowing mechanisms, expanded internal and external auditing procedures, and revised codes of conduct.
  2. Bilateral and multilateral agencies have sought to improve the integrity of recipients. Activities include direct support for creating anti-corruption commissions, efforts to make government activities more transparent, strengthening civil society groups that can hold governments accountable. Some also use corruption indicators to guide the allocation of aid.
  3. Global anti-corruption support in the form of globally-applicable standards, services, or institutions, including: legal conventions that clarify abuses and facilitate international cooperation in prosecuting fraud and abuse (OECD Anti-Bribery Convention, the United Nations Convention Against Bribery); efforts to increase the transparency and accountability of international transactions, (EITI, FATF, IATI); and public rankings (Transparency International, World Bank’s Worldwide Governance Indicators).

The paper also highlights four key questions that remain unanswered: (i) are the resources invested in anti-corruption commensurate with the extent of corruption?, (ii) are the costs of improving integrity worthwhile given the lack of evidence on the impact of such initiatives?, (iii) can external agents make any difference in pushing for recipients to operate with greater integrity? and (iv) do public goods improve integrity?

A more coherent anti-corruption strategy would combine the current preoccupation with means – implementation and strengthening – within the context of ends – results, service delivery, welfare. Better measurements could help:

  • Prioritise investigative resources.   A systematic portfolio approach would generate a sample of troubled operations that could be used to identify projects that are potentially failing due to corruption and guide focus.
  • Test control strategies against results. More regular testing for the effect of control methods on development results would enable improved strategies. This would include a programme of research into the effectiveness of different control methods and a broader analysis focused on variations in implementation that would help aid agencies to adjust, improve or discontinue existing methods.
  • Implement more pay-for-results programmes. This would require identifying which programmes have goals for which appropriate indicators and how they can be developed, measured and verified.
  • Be selective about providing aid on the basis of objective criteria (results). This requires treating countries that are effectively delivering services, regardless of how they appear to be following international practice, as trustworthy and reliable.

Source

Savedoff, W. (2016). Anti-corruption strategies in foreign aid: From controls to results. Washington, D.C: Center for Global Development.