Introduction
According to the 2023 Transparency International’s survey on the “Corruption Perception Index,” Nigeria scored 25 on a scale from 0 (“highly corrupt”) to 100 (“very clean”). When ranked by score, Nigeria placed 145th among the 180 countries in the index, where the country ranked first is presumed to have the most honest public sector.
Recently, countries like Denmark, Finland, New Zealand, Norway, Singapore, and Sweden have been adjudged as the least corrupt, consistently ranking high in global financial transparency. On the other hand, countries like Syria, South Sudan, and Venezuela (scoring 13), alongside Somalia (scoring 11), are listed among the most corrupt, as captured in the Corruption Perception Index (CPI).
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There is no doubt that corruption is an ill wind that blows no one any good. In all honesty, this cankerworm has eaten deep into our system. Its devastating impact has become increasingly worrisome and alarming in recent years within our polity, depriving us both individually and collectively of our shared values. This write-up will focus essentially on the role that the principle of “NOCLAR” can effectively play in stemming, mitigating, or possibly eradicating this cankerworm known as “corruption.” Before advancing further into this critical issue, there is a need to holistically ascertain the true meaning of “corruption.”
“Economically, it redirects public resources to inappropriate or unproductive destinations, causing damage to national development. Socially, corruption erodes public confidence and trust in the governance system, which is critical for national cohesion and societal progress.”
The word “corruption” does not have a universally accepted definition. However, it can be looked at as the abuse of office for personal gain, wrongdoing incompatible with norms or value systems, or the abuse of entrusted power for private or personal gain. Corruption also includes bribery, fraud, and other related acts. Furthermore, it can connote the act or process of corrupt practices.
Beyond these descriptions, a better understanding of corruption can also be found in the “offences” listed or defined by the Independent Corrupt Practices & Other Related Offences Commission (ICPC) Act of 2000, as amended. These offences include accepting gratification, fraudulent acquisition of property, giving and accepting gratification through an agent, fraudulent receipt of property, making false statements or returns, bribery of public officers or officials, using office or position for gratification, and inflating the prices of commodities above the prevailing market rate.
In addition to the ICPC’s description of corruption, Asaolu (2013) summarised the forms of corruption to include embezzlement, fraud, extortion, nepotism, cronyism, and bribery, which includes kickbacks and payoffs.
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Impact of corruption in our system
The effect of corruption on our society, especially in the public sector, can be summarised using the PESTLE model, representing political, economic, social, technological, legal, and environmental costs. Politically, corruption undermines our democratic values and principles within the governance structure. Economically, it redirects public resources to inappropriate or unproductive destinations, causing damage to national development. Socially, corruption erodes public confidence and trust in the governance system, which is critical for national cohesion and societal progress.
Technologically, corruption leads to wrongful investments in unprofitable or lesser rewarding ventures, wasting public resources. Legally, corruption often results in costly litigation, which can drag on for years, and in many cases, may not reach a satisfactory conclusion or might be squashed without resolution. Environmentally, corruption leads to the unnecessary exploitation of natural resources, causing environmental degradation and pollution.
The role of NOCLAR in addressing corruption
In a world where wealth aggrandisement or illegal property acquisition is commonplace, there is a need to look inwardly at how to mitigate or eradicate corruption. The NOCLAR principle presents a viable solution to this mess that has entangled us for ages.
The negative impact of corruption often spells doom for its victims, society, and the government at large. Corruption transcends geographical boundaries, making it a global concern. However, several measures have been crafted to decisively address corruption, including whistleblowing policies, forensic engagements, and more importantly, the NOCLAR principle, championed by the global accountancy profession.
NOCLAR stands for “Non-Compliance with Laws and Regulations.” It is a classified standard guiding professional accountants on the actions to take in the “public interest” when they become aware of potential illegal acts, known as Non-Compliance with Laws and Regulations, committed by a client or employer. The code, which came into force on July 15, 2017, was established by the International Ethics Standard Board for Accountants (IESBA), an independent board that develops and issues high-quality ethical standards and pronouncements for professional accountants globally.
NOCLAR, like the Whistleblowing Policy, plays a vital role in addressing breaches of laws and regulations related to issues such as money laundering, fraud, bribery, corruption, tax evasion, environmental protection, and public health and safety.
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Benefits of NOCLAR
The adoption of the NOCLAR principle will yield numerous benefits. First, it will strengthen efforts to fight corruption and corrupt tendencies. Second, it will raise the ethical bar for the global accountancy profession, as accountants will be guided by a higher level of responsibility to the public interest. Additionally, NOCLAR demonstrates that professional accountants act in the public interest, prioritising the needs of the public and other stakeholders, including the government, vendors, shareholders, regulators, and multilateral institutions.
NOCLAR sets the accountancy profession ahead in the global fight against corruption, financial crimes, money laundering, bribery, insider trading, and tax evasion. It promotes greater accountability and transparency among organisations, safeguarding investments from losses due to non-compliance with laws and regulations. This principle ensures zero tolerance for corruption, fraud, embezzlement, and related offences, and encourages senior professionals to insist on compliance with laws and regulations. It also provides guidance in jurisdictions where legislation does not adequately address accountants’ responsibilities.
Additional measures
In addition to NOCLAR, other measures can complement efforts to combat corruption. Governments should enact anti-bribery and anti-corruption laws, similar to the ICPC Act in Nigeria. Promoting ethical values across all levels of government is crucial, as is encouraging whistleblowing within and outside government quarters. Judicial reforms are also essential to ensure that corrupt individuals are swiftly prosecuted and punished.
Proper record-keeping and effective internal control systems should be encouraged at all levels of government. Public awareness campaigns must be conducted to educate citizens on the dangers of corruption. Rewarding job performance fairly within the public sector will help reduce the motivation for corrupt practices. Finally, sanctions and punitive measures should be imposed on defaulters to deter others from engaging in corrupt practices.
Conclusion
We must all join hands to win the war against corruption. This fight must start from our homes, clubs, professional associations, and religious organisations, and extend to the government. Only by tackling corruption at every level of society can we truly reap the dividends of good governance.
Kingsley Ndubueze Ayozie KJW, FCTI, FCA – a Public Affairs Analyst and Chartered Accountant writing from Lagos.
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