Thank you all very much for the invitation to speak to you today. I would especially like to thank Igor Tot of Dell and Anton Alferov of Halliburton for making this possible.
I would also like to thank you for the important work that you are doing. Fighting corruption and helping build clean and fair marketplaces are things that we value in America. I know how difficult your work can be sometimes, and that is why I wanted the chance to speak with you directly.
I have spent most of my career as a diplomat, so I understand the importance of mitigating risk and managing uncertainty. These two challenges are faced by businesses every day, but especially in environments where the rule of law is not consistent. In my time in Russia, I have worked closely with Russian and American businesses, so I know that what you do is critical for the long-term stability of your companies and for the prosperity of the United States and Russia.
To let you know where the United States stands on corruption, I would like to offer a few points.
First, I want you to know that the United States stands with you in the fight against corruption. Every country in the world – including the United States – is harmed by people who solicit bribes, cut corners and do business under the table. We recognize corruption is a scourge that undermines public confidence in government, business, and social institutions. It stifles innovation, and it impedes job creation and investment. It demoralizes people, and causes them to lose faith in leadership. As Secretary of State John Kerry recently said, “People are angry and the anger is going to grow unless we shut the doors and try to prove to people there’s a fairness that can be established in the system.”
Government can play a role in the fight against corruption. In an interconnected world, governments must work together to build common standards, share information, and promote ethical behavior.
During the anti-corruption summit in London a few weeks ago, the United States announced major initiatives in three categories: the first is strengthening law enforcement efforts and working across borders to hold corrupt actors accountable; the second is strengthening capacity to prevent and fight corruption in countries across the globe; and the third category is to promote greater financial transparency to prevent perpetrators of fraud, tax evasion, and illicit funding from hiding in the shadows.
In America, we try to lead by example. The State Department has long incorporated anti-corruption in its programs and has doubled its anti-corruption assistance over the past four years. And as Secretary Kerry announced at the London Anti-Corruption Summit just a few weeks ago, we are committing another $70 million to support new programs around the globe. We have passed anti-corruption laws, such as the Foreign Corrupt Practices Act – the FCPA — which prohibits American companies from paying bribes overseas. We work with other nations who want to confront corruption, and we lead efforts through international bodies like the United Nations to develop standards that we can all live by.
The FCPA provides a more level playing field, both for American businesses as well as international companies. You can see proof of that by looking at the list of companies that have been fined under the FCPA: it includes both American and foreign companies. Complying with the FCPA does not hurt a company; in fact, American companies for decades have served as models for corruption compliance while still remaining internationally competitive.
I heard an interesting story recently from the head of the Foreign Commercial Service at the Embassy. He told me about a businessman friend who told him that the Foreign Corrupt Practices Act was the best piece of business regulation that the U.S. Congress had passed in the last 50 years.
That may be a strange claim, the businessman said, but the FCPA actually protects American businesses overseas, because corrupt officials in other countries know that American businesses simply cannot violate this law, so they don’t even bother asking for a bribe.
The second point I would like to make is that, in the fight against corruption, businesses like yours can have the biggest impact. After all, businesses and the economies in which they work are paying the price of corruption. And, when you have strong government and civil society partners, your impact in this area is greatly amplified. That includes a strong, independent media that is free to shine a light on illicit activities.
Like people everywhere, Russians deserve an open and fair marketplace and the ability to exercise their rights without fear of retribution.
Russia has a long way to go in its fight to reduce corruption, but thanks to professionals such as you, we have seen some positive signs. In 2012, many Russian businesses and trade associations signed an anti-corruption charter. From this starting point, Russian and international businesses operating in Russia must strive to create a culture of compliance and resist pressure to pay bribes to corrupt officials or businesses.
The final point I would like to make is that “clean business is good for business.” In a world increasingly dominated by social media and access to information, companies who act unethically face serious damage to their reputations. In America, more and more we see people connecting online to protest or even boycott businesses who act out of line.
Establishing a corporate ethic built on honesty and transparency attracts investment, it draws the brightest talent, and people feel good when they do business with a company they respect.
I want to thank you all again for the opportunity to speak with you today, and I want to wish you all the best in the critical work that you do.