As the global lockdown limits the deployment of effective control mechanisms, corruption in the aid sector could very well increase. Today’s piece is a wake-up call to citizens who we believe should demand transparency and proper accountability in the post-COVID times. Read below the article on the corruption risks in the aid sector that Malika Aït-Mohamed Parent published on the EuroCompliance website, the certification and training company dedicated to the prevention of corruption.

The COVID-19 disruptive times did not slow down the fraud and corruption risks

The lockdown imposed on number of humanitarian stakeholders reduced the deployment of effective control mechanisms. Humanitarian workers could observe an increase of fraud and corruption schemes. Indeed, the huge influx of financial flows into the pandemic disaster’s response setting created fecund ground for corruption. Among the most frequently observed schemes,  one can list : bribes to ‘speed up access to healthcare’ or on the other side, denial to access to health resources;  diversion of resources, ‘expedited procedures’ in procurement processes with reduced control mechanism or segregation of duties; ‘ghost lists’; extortion; nepotism in the selection of beneficiaries,…

Hopefully, NGOs integrated in their Business Continuity Plan some specific crisis-driven adjustments to their existing key processes (e.g. IT, Internal Control…) ensuring also, that their ‘crisis management’ did integrate the risk management component. New approaches had to be considered. For instance, the UN Migration agency (IOM) decided to enter in Tik Tok (a social media based on shared videos largely used by young people) to combat fake news  impacting on the youngest generations.

Of course, most of the field audits and field investigations had to be postponed, while whistleblower help lines have been maintained.

More information sharing is needed

Learning lessons from past pandemic such as Ebola Outbreak have been largely shared (e.g. U4 Help Desk Answer  publication). Unfortunately, as we all know, ‘information sharing’ is far to be enough and ‘good will’ is not a firewall against bad behaviour and misconduct. The most effective actors were certainly those who got effective ‘fraud and corruption, prevention and control’ policies in place. This requires an active implementation of the entire cycle ‘prevent, detect, deter, sanction’.  A policy on its own, is indeed a good start. An effective implementation mechanism is better. Getting staff trained and prepared is the most powerful defence, especially when it is combined to active internal control mechanisms.

I led a research on ‘The role of compliance in the fight against corruption in aid and in particular in the humanitarian sector for which I interviewed several humanitarian workers, deployed in different fields of operations. To my big surprise, most of them, did not ‘know/understand’ that they were ‘the first line of defence’. Does it mean that they did not contribute to the prevention and control of ‘fraud and corruption’? May be not. But for sure, it gives some insights on the overall coherence of the ‘fraud and corruption, prevention and control’ in this specific industry.

Most of the NGOs consulted at that time did not get an ‘organised compliance portfolio’. The culture of institutional peer reviews, combined to self-assessments, developed along specific standards is still extraordinarily strong (e.g. The Sphere Handbook, Core Humanitarian Standard on Quality and Accountability). Most of the ‘acting compliance officers’ I met with, were in fact, ‘legal department’ staff acting on ‘compliance portfolio’. None of the 30+ NGOs knew about ISO 37001.

Of course, any single of them knew about ‘Setting the tone from the Top’, ‘getting the right audit control, ethics portfolio, investigation mechanism, governance set up and series of interrelated policies (‘Fraud and corruption, prevention and control’ policies; ‘Staff code of conduct’; ‘Prevention of Sexual Exploitation and Abuse’ policies; ‘Anti-Harassment’ policies; ‘Conflict of interest’ policies; ‘Gift’ policies; ‘Data protection’ policies…).  While the business context requires new set of skills and competencies, staff are trained to get update, upgrade, or shift of their competencies. The necessary business shift must be applicable as well to the governing bodies constituted often by elected personalities. Their business profile and competencies must be aligned as well to the new business requirements.

Compliance and ethics key to modern governance

There is still a long way to go for the Non-for-Profit sector, when it comes to embrace a culture of ‘compliance’ and ‘risk management’. Huge efforts have been deployed on the front of Integrity (in the 90s), Accountability (decade 2000), Transparency (decade 2010). The 2010 decade ended with a syndrome of Hyper Transparency. Guess what will come for the 2020 decade? Most probably Compliance and Ethics with ISO 37001 in its centre.

Specialised in the fight against corruption in the aid sector, Malika Aït-Mohamed Parent is an international speaker, investigator, EuroCompliance ISO 37001 auditor, vice-chair of the UNHCR ‘Independent Audit and Oversight Committee’ and member of the ILO ‘Independent Oversight Advisory Committee’.

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