The Kenya Private Sector Alliance (KEPSA) remains committed to the fight against corruption in Kenya. As the Apex body for the private sector we are concerned over impact that corruption has had on the overall cost of doing business. Corruption is an unseen levy on businesses and further distorts the cost of goods and services within the economy. Corruption draws away much needed public funds intended for service delivery and diverts them to serve individual interests sacrificing our development agenda.
Kenya loses over one third of its annual budget to corruption and misappropriation of public funds and assets. The actual cost of corruption to the overall economy is however yet to be quantified as private companies are also subject to corruption and collusion within their operations leading to massive loses that are yet to be quantified.
According to the Ethics and Anti-Corruption Commission (EACC) 70% of all corruption cases within the government are linked to procurement while a further 20% is linked to bribery. This means that 90% of corruption cases within government happens through interaction with private entities. The private sector recognizes the fact that it is both a victim and a perpetrator of corruption; on one hand the it is private entities and individuals who are the givers of bribes and influencers of corrupt practice within government, but on the other hand private companies are subject to the same level of corrupt practices and influences within their own tendering system.
In order to reduce the incidents of corruption between the public and private sector KEPSA has mainstreamed the fight against corruption into its agenda through its Public Private Dialogue structures addressing the issue directly to the highest office in the land through the Presidential Round Table. During the last two Presidential Round-tables in particular KEPSA committed to lead the efforts of the private sector in the fight against corruption.
In this regard the private sector under the banner of MKenya Daima is actively involved in the fight against corruption and the push towards the adoption of ethical practices to safeguard both public and private funds and assets. Through MKenya Daima the private sector has endorsed the adoption of the Business Code of Conduct developed by the UN Global Compact. The key partners driving this initiative are: the Kenya Private Sector Alliance, the Kenya Association of Manufacturers and the Global Compact Network Kenya. So far over 400 companies have signed up to the Code. All professional associations and business member organizations that have signed up to the code will also make it a requirement for their members to sign up and abide by the Business Code of Conduct.
The code seeks to entrench a corporate culture under which corruption will not be allowed to thrive more so in the interaction between public and private companies. According to a survey conducted by PricewaterhouseCoopers (PwC) on the prevalence of economic crimes, Kenya was ranked 3rd among the 103 countries that participated in the survey. The survey found that over 70 per cent of economic crimes were perpetrated by internal fraudsters exploiting their intimate knowledge of internal systems. Going by the findings additional emphasis must be placed on sealing the loopholes within our own processes and procedures along with the regulations that govern procurement.
Additionally, the private sector has also initiated the Business Against Corruption in Kenya (BACK). BACK, which is established under the UN Global Compact will work with the government to end corruption in Kenya. Private Sector entities that are members of BACK contribute 60% of GDP and employ millions of Kenyans. The role of BACK is to Lead private sector efforts against corruption in Kenya, Support a new legal framework against corruption and Work with Government to reward honest behaviour.
In recognition of the fact that there are legislative gaps in seeking to prosecute and access information on corrupt practices within the private sector, a Draft Anti-Bribery Bill that seeks to support efforts to streamline the legal processes for dealing with corruption has been prepared. The bill also seeks to deal with corruption resulting from dealings with foreign entities by extending the mandate of various agencies beyond Kenyan territory. The bill has already been reviewed by the office of the Attorney General and is set to tabled in parliament for review before it is enacted.
MKenya Daima will lead a Culture change program aimed at shaping the minds of Kenyans towards ethical practices. The program will also seek to instill a sense of personal responsibility enabling Kenyans to hold their leaders accountable.