MBR_ISSUE 47_JAN_LR

INTERVIEW OF THE MONTH
Malta Business Review
"State capture
is a situation
where powerful
individuals,
institutions,
companies or
groups within or
outside a country
use corruption to
influence a nation's
policies to benefit
their own private
interests.
they joined EU. She defines control of
corruption as the capacity of governments
to constrain corrupt behaviour in order to
enforce individual integrity in public service
and uphold a state free from the capture of
particular interests.
According to the "state capture" hypothesis,
public institutions at large are perceived as
most corrupt. State capture is a situation
where powerful individuals, institutions,
companies or groups within or outside
a country use corruption to influence
a nation's policies to benefit their own
private interests. It is worth recalling the
parliamentary speech of Italian Prime
Minister Bettino Craxi since it provide
evidence of what is called "systematic
corruption": "What needs to say and which
in any case everyone knows, is that the
greater part of political funding is irregular
or illegal. If the greater part of this is to be
considered criminal pure and simple, then
the greater part of the political system is
a criminal system". The United Nations'
Secretary-General Ban Ki-moon, pointed out
that gauging perception is like measuring
smoke rather than seeing the fire.
The Oil-for-food scandal is a further example
confirming the involvement of public
institution even at international level. In
addition, Deutsche Bank scandal on money
laundering shows that financial institutions
are not immune from corruption.
MBR: Do you think that technology and
artificial intelligence can find out which
politicians are corrupt?
ET: The new generation of anti-corruption
policies are based on digital technologies
and big data.
In particular, Blockchain is the most potent
tool against corruption by providing
transparency through a decentralised system
that records the sequence of transactions.
It allows the full traceability of every
transaction. According to Carlos Santiso,
Blockchain is particularly suited to fight
corruption in the registry of assets and the
tracking of transactions such as procurement
processes. By leveraging a shared and
distributed database of ledgers, it eliminates
the need for intermediaries, cutting red-tape
and reducing discretionality.
In 2015, Mark Walport, chief scientific
adviser to the UK Government, presented a
report on "Distributed Ledger Technology:
beyond block chain" which highlights the
application of block chain technology in
government policy toward transparency
and integrity. In the same line, an official
of the Veneto Region, Marcello Zanovello,
is studying the applicability of Blockchain
against the misuse of public office.
In conclusion, academic world and
practitioners confirm that mainstreaming
this technology will improve anti-corruption
policy.
MBR: Malta is the 46th least corrupt nation
out of 175 countries, according to the 2017
Corruption Perceptions Index reported by
Transparency International. What are your
comments?
ET: European Northern Countries are
perceived free from corruption when dealing
with bribery, but when conflict of interest
is considered, they result the most corrupt
countries. Despite its prominence, the
Corruption Perception Index has become
increasingly controversial in recent years.
Definition problems, perception bias, false
accuracy, a flawed statistical model are
prevalent weak factors. The mismatch
between perception and experience
undermines the credibility of survey on
corruption based on perception. However,
when the Maltese media highlights that
corruption is the country's biggest challenge,
one can conclude that corruption is "real"
even in Malta. At the same time, the
initiative of the Malta Federation of Liberal
Profession on Professional ethics confirms
the presence of economic actors moving
toward a corruption free culture. MBR
This was first published in The Malta
Independent
Dr Enrico Tezza co-author of a new book entitled Evaluating Corruption: Something Rotten Around the World
André Camilleri, Production Manager, TMI
Credits: The Malta Independent
www.maltabusinessreview.net
13