CONVOCO! Lecture 11/2018: Addressing Corruption – Why it Matters
CONVOCO! Lecture 11/2018:
ADdressing Corruption - Why it Matters
Sean Hagan, Visiting Fellow at Oxford University and General Counsel of the International Monetary Fund until September 2018, held a Lecture with the title Addressing Corruption – Why It Matters at the ESMT Berlin on 26 November. This Convoco event concluded the Convoco topic of 2018 The Multiple Futures of Capitalism.
Dr. Corinne Flick held the introductory speech underlining how dangerous corruption is for the society and the economy.
“Where corruption starts, states begin to fail.”
Corruption takes place when public trust is abused. Corinne Flick showed that there was a severe lack of trust that citizens have in their government. Trust, however, is an indispensable prerequisite for the functioning of a market economy. Corinne Flick emphasized that such trust can be built upon and secured by the foundation of the rule of law. Nevertheless, the rule of law must be flexible so that it can adapt itself to changes and that it is accepted.
“Corruption knows no borders.”
Corinne Flick moved on to the importance of institutions for society. They give the long-term perspective a chance in today’s fast-changing world and they limit the arbitrariness of individuals. As corruption is a global phenomenon, Corinne Flick mentioned international institutions such as the IMF as key elements in the successful fight against corruption.
After the introduction, Sean Hagan held the Lecture Addressing Corruption – Why It Matters. First, he talked about the drastic consequences that systemic corruption in the public sector entailed. Particularly, if the core functions of a state (fiscal, regulatory, and security policy) are undermined by corruption, this leads to political instability.
“Corruption is a crime of calculation not of passion.”
Sean Hagan went on to mention different methods in the fight against corruption. As corruption happens on the basis of calculation, it is important that there exists a credible threat of prosecution. This approach, however, must be met with transparency and deregulation, as each method on its own remains insufficient in the fight against corruption. In the last part of Sean Hagan’s lecture, he analysed corruption in the private sector. He stated that the financial crisis of 2008 can also be related to the phenomenon of corruption. This experience has shown that ethics should become an integral part of today’s market economy again. Institutions must be reformed, which also means to make a shift in individual values.
Before the lecture, the Convoco network answered three questions concerning corruption and the market economy. Here you can see the results of the poll: