Sir Don McKinnon Becomes TINZ Patron
The Right Honourable Sir Don McKinnon
The Right Hon Sir Don McKinnon is Transparency International New Zealand’s new patron.
Sir Don is a former Secretary General of the Commonwealth, as well as having served as New Zealand’s Deputy Prime Minister and Minister of Foreign Affairs.
Sir Don is taking over from former Governor General, The Right Hon Sir Anand Satyanand who has served as TINZ patron for the last three years.
As TINZ's patron Sir Don is continuing his long tradition of being highly involved in the Pacific, with the Commonwealth and his particular emphasis on supporting "good governance". He is committed to New Zealand and its place in the wider world and to human rights and good governance as the most effective antidotes to corruption.
“We are excited to welcome Sir Don to the position as Patron to Transparency International New Zealand. We applaud his commitment New Zealand and its place in the wider world, to human rights and good governance as the most effective antidotes to corruption" said Transparency International New Zealand’s Chairperson, Suzanne Snively.
“We are working to strengthen Transparency International chapters throughout the Pacific. Sir Don’s involvement comes at a crucial point in this process, given his experience and his standing in the wider Pacific region. We know Sir Don will provide wisdom to help shape the direction and activities of TINZ as we continue to champion transparency throughout New Zealand, the Pacific and the world.” continued Snively.
Sir Don said he was delighted to be part of Transparency International.
“Transparency International is a respected organisation that works to encourage high standards of governance in organisations throughout the world,” Sir Don said.
In This Issue
Lynn McKenzie Joins TINZ as Interim Executive Officer
As the Interim Executive Officer (pro bono) Lynn is focused on supporting the Board to achieve its goals. She is especially motivated to raise awareness of the need for trusted integrity systems in all sectors of NZ and in supporting fundraising initiatives.
Lynn has 27+ years' of senior leadership, management consulting and Board experience, primarily with Not for Profit, Government, Crown Entity and national and international membership organisations. Most of this has been with service delivery organisations in the health, housing, social and employment sectors. Lynn consciously works and volunteers for organizations driven by a need to improve everyone’s life chances. She has a special interest in leadership, children and women. Her interests match TINZ’s mission recognising that a corrupt free world is good for everyone.
In July 2014 Lynn finished her term as Global Chief Executive and President of Zonta International and the Zonta International Foundation. Zonta is a well-respected global membership organization with 30,000+ business and professional members in 67 different countries. Its mission is to empower women through service and advocacy.
“My role took me to many parts of the world and I saw first-hand the detrimental impact corruption has on communities and countries. Last year when entering another country I even was asked for a facilitation payment (small bribe). It took me a while to realize that was why I was being stopped. Besides responding that my yellow fever certificate was in order – I said nothing more and when moved on – I quickly headed to the exit door.”
TINZ Appears before the Law and Order Committee Regarding the Organised Crime and Anti-corruption Legislation Bill
TINZ's Presentation to the Law and Order Selectcommittee
Below is the text of TINZ's presentation to the Law and Order Select Committee.
1. Transparency International New Zealand Inc would like to thank the Select Committee for providing us with the opportunity to speak today.
2. We welcome the introduction of the Organised Crime and Anti-Corruption legislation and feel that it will strengthen current legislation and improve our standing in the international community.
3. However, the Committee needs to be aware that the Bill does not overtly deal with the matter of facilitation payments and in not attending to this leaves the door open for the legal payment of bribes.
4. Facilitation payments are “low value bribes paid to public officials to obtain or expedite a routine governmental action by a foreign official, political party, or party official. An example would be a bribe paid to a customs officer, so that the customs officer would release conforming goods being held at a border.
5. We would strongly emphasize that facilitation payments are illegal in the countries where they are paid. Thus when New Zealand companies operating overseas make facilitation payments (and report on them to meet the proposed legislation) they are, in fact, in violation of the host country’s anti-bribery laws. We would also like to note that a New Zealander who makes a “facilitation payment” to a foreign customs official would face criminal penalties for making the same payment to an official here at home.
6. Facilitation payments are not recorded and go directly into the pockets of corrupt government officials. Paying these low value bribes perpetuates a corrupt system; imposes additional costs on the host country’s companies and citizens and undermines efforts by the host country’s government to stamp out corruption in their public service. To put it bluntly New Zealand companies, by paying small bribes, become part of the problem rather than part of the solution.
7. Eliminating the loophole for facilitation payments, or small bribes, would align New Zealand with leaders in this area and truly demonstrate its commitment to being a country of integrity and good (unambiguous) business practice.
8. Until relatively recently the United States, Canada, Australia, New Zealand, and South Korea allowed their citizens to make facilitation payments. Canada has now prohibited facilitation payments and there are indications that the US and Australia will follow. The UK has strong legislation in this area.
9. The UK Bribery Act 2010 prohibits facilitation payments and applies to New Zealand companies doing business there. The Bribery Act is extra-territorial, which means that the relevant person or company can be prosecuted for the crimes even if they were committed overseas. Thus a NZ company, with operations in the UK, could be in compliance with NZ legislation but in violation of UK legislation and prosecuted.
10. Prohibiting facilitation payments will not present obstacles for NZ businesses. A 2009 business survey conducted by TRACE International found that 76% of survey respondents believe it is possible to do business successfully without making facilitation payments given sufficient management support and careful planning. The line between a permissible facilitation payment and an illegal bribe can be very blurry. Strong legislation will provide clarity and guidance to NZ businesses when they operate overseas.
11. Rather than revisit the facilitation payments area further down the line, Transparency New Zealand feels that it should be addressed in the current proposed bill. Therefore we request the Committee strengthens its position and prohibits facilitation payments.
 TRACE received seventy-six responses to this survey. Survey responses relate to corporations headquartered in North America, Western Europe, Asia, Central America, the Middle East, Africa and Australia/Oceana. These corporations operate in virtually every region of the world and represent an array of industries.
TINZ Chair, Suzanne Snively and Director, Daniel King Waiting to Appear Before the Law and Order Select Committee on the Crimes Bill
On 11 March, 2015, TINZ Directors, Daniel King and Suzanne Snively, presented before Parliament’s Law and Order Select Committee Regarding the Organised Crime and Anti-corruption Legislation Bill.
TINZ was one of the few submittors invited at short notice by the committee to appear before it.
The Select Committee’s interest and response left TINZ cautiously optimisticthat it was open to strengthening the legislation in regard to facilitation payments. TINZ was asked to provide specific wording for the Committee to consider when revising the Bill and to compare the recommended wording with the UK Bribery Act and the Canadian legislation. Committee members were also interested in what the US and Australia are doing.
Corruption Exists, Corporate Controls Not in Place Survey Finds
Deloitte Bribery and Corruption Survey 2015 Australia & New Zealand
Transparency International New Zealand was well represented during March events promoting the release of the Deloitte Bribery and Corruption Survey 2015 Australia & New Zealand.TINZ Directors, Daniel King and Mark Sainsbury, both participated in the panel discussion held in Auckland and Daniel joined with new Wellington Regional Chamber of Commerce head, John Mitford, at the Wellington release event.
Daniel King, Nick Paterson and Ian Tuke at the Wellington Deloitte Survey Launch
In 2012 Deloitte surveyed Australian and New Zealand organisations on offshore bribery and corruption risk. They identified a range of themes around exposure, enforcement and accountability and highlighted the fact that Australian and New Zealand organisations were encountering bribery and corruption incidents and challenges which many were ill-equipped to identify, manage and, most importantly, prevent.
The Deloitte Bribery and Corruption Survey 2015 Australia & New Zealand provides an essential follow up on the significant risks presented by this complex issue. It again focuses on risks related to overseas investments and operations but, given recent high profile domestic corruption incidents in both Australia and New Zealand, it also looks at risks from a domestic perspective.
The survey shows that almost a quarter of public and private organisations have experienced domestic corruption in the last 5 years, more than half occurred in the last year. In their media release, Deloitte speculated that an increase in bribery and corruption tarnishing New Zealand's ethical image may be due in part to an influx of migrants from countries where such practices are considered normal.
The most common types of domestic corruption cited by respondents included undisclosed conflicts of interest, supplier kickbacks and personal favours.
According to Deloitte Lead Forensics Partner Barry Jordan "There remains a concerning number of organisations that don’t have formal compliance programmes or don’t discuss corruption risk at their highest levels."
Transparency International New Zealand provides access to a free online Anti-Corruption Training Tool designed by leading experts in the field. This enables organisations to encourage training for their personnel in awareness and prevention. This training was developed in partnership with the the UK Chapter, the Serious Fraud Office and BusinessNZ.
The Business of Bribery
A Public Discussion on the Organised Crime and Anti-Corruption Legislation Bill with John Allen and Dr. Michael Macaulay moderated by Ian Fraser was hosted by IGPS on Wednesday 15 April at Victoria University.
The 80 seat lecture theatre was full with student attendees mixing with those from across several government agencies, businesses and civil society organisations. The photos below were taken at the event.
John Allen, Ian Fraser, Michael Macaulay
Michael Macaulay Discussing UNCAC Membership
Speaker John Allen and moderator, Ian Fraser with Michael Macaulay's Presentation Behind
TINZ Director Profile: Charles Hett
Director, Transparency International New Zealand
Charles Hett was appointed to the TINZ Board from March 1 2015 and welcomed at its February meeting.
Charles believes sunlight and transparency are critical features of social environments and the benefits of a low-corruption society can easily be lost (like reputation) and are hard to regain - so he sees them as worth applying energy and effort to maintain.
Charles comes from the financial sector and has experience of financial services businesses in New Zealand, Australia, UK and Asia; both as a consultant and holding various insurance company roles. Charles established and has led the Deloitte NZ actuarial team since 2008. He is currently the Appointed Actuary to two insurers - one general insurer and one life insurer. He is a qualified actuary and holds a Masters Degree in Mathematics from Oxford University. He is a member of the New Zealand Institute of Directors.
Charles has undertaken significant research into complex adaptive systems, the nature of knowledge-sharing and how to help groups of people improve things that are important and help them achieve their goals. Much of this involves narrative, collaboration and transparency; Charles is a Director of Storymaker Research Institute.
Here are some of Charles's responses to our questions:
What motivated you to Join TINZ? I am excited about the chance to provide real support to TINZ governance alongside necessary services to help us focus on the important issues.
Why does New Zealand have such a strong international reputation for transparency and good governance and how does New Zealand benefit? I think it is partly size. It is easier and safer I think for smaller governments to be more open and we also benefit from being a relatively new society. Our reputation provides an open door for almost all NZ activities including trade. The fact so many New Zealanders' have noticeable roles in global organisations links to New Zealand's bold, independent and transparent society.
What challenges do we face? Timeframes and visibility are major challenges to our effort of promoting transparency, good governance, and ethical practices in New Zealand. These values and behaviours take time to build and enhance and yet are comparatively invisible. Losing them, however, could happen quickly and visibly.
What steps do you think we can take to safeguard us from corruption in New Zealand? Vigilance, discussion and encouragement are key steps. It is imperative we help wider society see and gain benefits from our positive environment and also be encouraged to demonstrate that corruption in New Zealand is not acceptable in any way at any time.
Transparency International Announces Corruption in Sport Initiative
“Few people are unaware of the magnitude of sport as a global industry, with revenues larger than China’s military budget or the nominal GDP of more than two-thirds of the world’s countries,” leads Transparency International's Press Release.
The release continues, “Almost all of us play a part in it as participants, spectators or taxpayers. And yet, despite its rude financial health, sport’s relevance as a symbol of fair play today hangs in the balance.”
On 9 April, 2015 Transparency International announced a new Corruption in Sport Initiative aimed at providing space for analysis, commentary and recommendations aimed at strengthening transparency in sport. Read more about Transparency International’s new ‘Corruption in Sport Initiative’.
The first article published on-line by Transparency International in the Global Corruption Report: Sport titled “Why are countries taking so long to act on match-fixing?”, describes match-fixing as a pandemic that is transnational and is linked to criminal activities, organised crime and money-laundering. There has been, however, a failure to recognise the threat that match-fixing poses not just to sport but to the society at large. Most countries have identified loopholes in their civil and criminal laws, which allow organised crime to thrive and hamper the efforts of law enforcement agencies and judicial authorities to combat match fixing at national and international levels.
Individual states have acknowledged that they cannot tackle the problem in isolation and they need a concerted effort with other countries and regional and international sport organisations. At present, however, very few countries have implemented measures involving the main stakeholders.
The article's author, Kevin Carpenter, a sports lawyer based in London, acknowledges in his article that there are three countries in the world that have established and implemented national action plans either in response to match-fixing scandals or for the prevention of corruption in sport. These countries are Norway, Australia and New Zealand.
As TINZ Director, Josehine Serrallach, says, “Once again New Zealand is among the top countries leading the world in preventing corruption. Sport NZ should be congratulated by its efforts towards coordinating all relevant parties to find effective ways of preventing match-fixing in the country, launching a national match-fixing policy, establishing a cross-government group, carrying out research and providing education programmes and anti-match-fixing on-line courses.”
TINZ Team Looking for Partners to Invest in New Zealand's Reputation
The majority of Chapters of Transparency International are in countries with high levels of corruption and are eligible to receive aid funding. The level of funding received means that they can employ several permanent staff. In contrast, as a Chapter in an aid-donor country, the New Zealand Chapter is ineligible for the ongoing funding that aid programmes can provide. Its current funding base is memberships and contributions from around 100 committed individual, business and government members and donors.
While this provides reliable funding for the essentials of financial and Board administration, TINZ’s volunteer Directors and Patron (recently complemented by volunteer Executive Officers and Fundraisers) manage the many TINZ projects and activities working many hours probone. From 2004, flow through funding from MFAT to go to the four Pacific Chapters (Fiji, PNG, the Solomons and PNG) gave the impression that the New Zealand Chapter received more revenue than it did.
Through the generous support of several government agencies, the School of Government, the Gama Foundation plus significant volunteer contributions from researchers, reviewers and business facilities, TINZ received sufficient resources to complete the most comprehensive National Integrity System assessment anywhere in the world This on its own, however, has been slow in attracting the ongoing investment required to support a viable and sustainable professional base for TINZ.
This is about to change through the initiatives of Brendon Wilson and James Bushell!!
Brendon Wilson and James Bushell
Brendon Wilson, TINZ Fundraiser
In February, the TINZ Board delegated authority to Brendon Wilson to lead initiatives to apply for philanthropic funding and assist in building corporate partnerships to invest in TINZ capacity, projects and programmes. Brendon says "the benefits of New Zealand’s strong international reputation, based on an un-corrupt public sector, can be realised across all sectors."
Working with Brendon is James Bushell. James philanthropic expertise and experience, including knowledge about social networking, added to his network of small and medium-sized ethical businesses, provides a basis for selecting sources of partnership funding with objectives consistent with those to TINZ.
TINZ’s strategy, centred on preventing corruption based on the strengthening of the New Zealand brand as a high trust society, is aimed at growing the New Zealand economy in a way that improves the well-being of all its citizens and organisations, whether public, private or community based. The paradox is that while ultimately everyone can gain from the outcomes of TINZ strategy, the objectives of most philanthropists, grants, donors and corporate giving are focused on very specific charitable activities, rather than activities that achieve universal benefits. TINZ approach is based on collaboration.It is looking to build build partnerships and achieve results through activities of mutual benefit.
Brendon’s belief is in the importance of the principles of integrity and transparency in all the ways society works. This has led him to: “a very happy and willing involvement with TINZ, who I would characterise as ‘a group of fine minds put to fine purpose’. I believe that most institutions and individuals in New Zealand instinctively hold an underlying belief in integrity, but most have never had much reason to prioritise it, so never think through its central importance and the ways to make it an effective strategy. That is TINZ’s exact role.”
Brendon and James approach is to demonstrate why TINZ is important to the achievement of others’ own objectives. As a result, by contributing to and investing in TINZ’s programmes, they achieve outcomes both of direct benefit to them AND to the people, organisations, communities and the economy that make up our nation.
Standing on the Precipice
Many funders prioritize their contributions as the ambulance at the bottom of the cliff, addressing immediate unmet needs. TINZ objectives focus on efforts at the top of the cliff that aim to prevent society’s and the economy’s accidents happening. This requires a sophisticated demonstration to funders of the additional value of their contribution, such that it is the nature of an investment in TINZ.
James Bushell brings experience in ethical business and giving
James notes that creating better societal cohesion and social equality has always been at the forefront of what drives philanthropy. He sees a growing awareness that the most effective way of achieving this is through societal change.
TINZ actively works to promote the highest levels of transparency, accountability and integrity in both government and civil society. It is through initiatives such as the “National Integrity System Assessment” recommendations, whose implementation is now being addressed in several ways, that cause such societal change. It is this type of work that creates large scale impact that affects societal cohesion and social equality.
Seeing the Big Picture - Funding What's Important but Intangible
Philanthropists and businesses who see this bigger picture will support and invest in the objectives and outcomes TINZ aims to achieve.
Connectivity is a rapidly progressing global trend, removing previous communication barriers, leading to connectivity with anyone around the globe with similar objectives. Social networking allows TINZ to connect to a wider demographic and interact with them in real time. This can be used for the rapid spreading of information and messaging to a larger audience as well as enabling platforms for open dialogue and collaboration around corruption and transparency..
TINZ high quality engagement at the sharp end of most parts of New Zealand society (viz in the huge effort in the 2013 National Integrity System Assessment) has prepared the ground – so much work and engagement has been done and continues daily. So the thought leadership and the supporting data are mostly there. The challenge now is to convince funders, donors, members and partners of the value to them of investing in TINZ. James views this as “an exciting challenge in a stimulating but worthwhile mind-space!”
Pacific Youth Gather in Fiji for Forum Against Corruption
Fuimaono Tuiasau, Director, Transparency International New Zealand, 25 February 2015
45 youth leaders from 15 Pacific Islands gathered in Nadi Fiji in the weekend of 23 February to take part in the inaugural Pacific Youth Forum Against Corruption. It seems that Robert Kennedy’s words of many years ago resonated in this Pacific gathering “This world demands the qualities of youth; not a time of life but a state of mind, a temper of the will, a quality of the imagination, a predominance of courage over timidity, of the appetite for adventure over the life of ease.”
Read the complete article on our website: Pacific Youth Gather in Fiji for Forum Against Corruption
TINZ Chair Attends Business Integrity Project and Financial Integrity Workshops in Berlin
March 24-26th, TINZ Chair, Suzanne Snively, attended the Business Integrity (BIP) Workshop in Berlin followed on 27 March by a Financial Integrity Workshop: Tackling Corrupt Financial Flows hosted by Transparency International in Berlin with funding from the Seimen’s Integrity Initiative. Participants made up an international working team to develop integrity systems for clean business and financial systems.
Conference attendance was across a range of Chapters including four of the BRICS (Brazil, Russia, India and South Africa, but not China),Germany, France, Netherlands, Spain, Sweden, Japan, the UK, Ukraine, US, Cambodia, Malaysia, Vietnam, Mongolia, Morocco, Isreal, Argentina, Chile, Colombia and 18 others. Not present were Australia, Canada and Taiwan.
The overall goal of Transparency International’s Business Integrity Programme is to reduce corruption through improved integrity, transparency and accountability in business.
To progress this goal, the BIP operates to promote integrity, transparency and accountability through:
- legal and regulatory frameworks
- industry sector groups
- individual business
The Seimen’s Grant will enable TI to broaden and grow the business integrity work, while building a sustainable portfolio of projects and funders for the longer term.
A key theme shared by the participants at the workshop was that a particularly effective way of progressing business integrity was to work to engage business leaders who understood that adopting anti-bribery principles, practices and programme was good for business and who would assist the Chapters in communicating this message to their local business and industry groups.
Among the topics covered in the Financial Integrity Workshop sessions included future-oriented banking, ending secrecy to end impunity and to trace beneficial owners, the role of due diligence and PEPs.
A discussion of the banking system and approaches to working with Banks to adopt processes that protect the public through greater transparency in conduct and by preventing large deposits of money from questionable sources.
Ending Secrecy to End Impunity: Tracing The Beneficial Owner
Issues discussed included requirements for information about the beneficial ownership of companies. Further discussion was around thelack of transparency of shell companies - where current laws do not require those forming a company to report who has ultimate control. This creates loopholes in efforts to fight money laundering.
Regulating Luxury Investments: What Dirty Money Can’t Buy
Luxury goods and real estate are among the preferred means for corrupt individuals to hide the illicit origin of their funds. There was discussion about how to specify and regulatee luxury investments.
Closing Banks to The Corrupt: The Role of Due Diligence And Peps
Banks provide one of the stopping places for ill-gotten monies. Until now, financial institutions and their regulatory authorities have failed to prevent Banks from being a safe place for the corrupt. The workshop discussed steps towards closing this loophole.
March 2015 TINZ Board Meeting
The TINZ Board meets by video-conferencing (video conferencing facilities generously donated by Deloitte) and Skype. Pictures from Wellington and Auckland are included here. This was Director Communications, Suzanne Carter‘s, final meeting and the first meeting of new Patron, the Rt Hon Sir Don McKinnon.
In Case You Missed It
TINZ's Presentation to the Law and Order Select Committee in the Press
TINZ chair applauds moves to crack down on corruption - Yahoo! News New Zealand
Corruption and Brazil's Crash LandingBrazil's Crash Landing: Corruption Engulfs Petrobras Amid Economic Contraction And Rising Inflation - Forbes
Corrupt Foreign Cash Pushing up House Prices in New Zealand and Worldwide
Time to register foreign buyers - New Zealand Herald
Bribery and Corruption - consequences begin at home
YouTube video Published on Mar 27, 2014. The City of London Police has commissioned this short crime prevention video to demonstrate the impact that a corruption investigation could have on companies and individuals who ignore the Bribery Act and break the law.
José Ugaz, chair of Transparency International from JamaicaMore corruption today than 20 years ago
Deloitte Survey Media CoverageNew Zealand Loses Its Perception Of Being Corruption Free
Perceptions Of Corruption Damaging To New Zealand‘s International Reputation
Selwyn Manning‘s analysis of recent corruption allegations. Read article on foreignaffairs.co.nz
Donors influence development decisions
A short report of what may emerge in the Pacific with the leadership of Meg Taylor as Secretary General of the PIF. This is important because:
- the review of donor funding was carried out
- of the conclusions of the review and
- of the recognition of the PNG PM that Pacific Sovereign Nations must ensure that donors be accountable to them instead of the other way around.
Transparency International New Zealand
P.O.Box 5548, Lambton Quay
Ensure New Zealand Remains as Good as it's Perceived
Renew Your Membership or Join TI-NZ NOW!
It is Easier than Ever to Join
Tell your friends and colleagues