Today’s blog post is courtesy of Michelle Juan, the Regional Consultant of TRACE in the Asia Pacific. Previously she was General Counsel at the Araneta Group of Companies, and an attorney at Romulo Mabanta Buenaventura Sayoc & De los Angeles.
This year, the Philippines celebrates the 28th anniversary of the 1986 People Power Revolution, a series of protests and mass actions aimed against electoral fraud, corruption, the suppression of civil liberties, and the widening gap between rich and poor during the 21 year regime of Ferdinand Marcos. The demonstrations took place on Epifanio de los Santos Avenue (EDSA) from 22-25 February 1986, and culminated in the exile of President Marcos and the restoration of democracy. Corazon C. Aquino, widow of slain opposition leader Benigo Aquino, Jr., was proclaimed the 11th President of the Philippines.
Despite EDSA and the return of democratic institutions, the road to reform has been difficult. In what was dubbed as EDSA II, President Joseph Estrada was removed from office in 2001 following a long drawn-out impeachment trial and allegations of large scale corruption in his administration (Transparency International’s 2004 Global Corruption Report estimated that Estrada embezzled US$70-80M during his abbreviated three year term). He was later convicted of plunder and sentenced to life imprisonment, but was pardoned by his successor, President Gloria Arroyo. Arroyo now herself faces corruption charges for alleged widespread misuse of government funds during her 9 year term. The former president, now a member of congress, has been under arrest since 2010.
In 2010, Benigno Aquino III, son of Corazon Aquino, was elected President. He ran on a reformist, anti-corruption platform, and his campaign battle cry was “Kung Walang Corrupt, Walang Mahirap” (“where there is no corruption, there is no poverty”). Aquino has made good governance and anti-corruption the cornerstone of his administration’s agenda, and, in the last three years, has taken concrete steps to tackle corruption (particularly, judicial corruption) and ensure the independence and capacity of key oversight agencies.
Most notably, Chief Justice Renato Corona, a staunch ally of former President Arroyo, was impeached and removed from office in 2012 for failing to disclose over US$2M in foreign currency assets. Plunder charges have also been filed against 3 senators, 5 former congressmen, and 30 others allied with the Arroyo administration in the “pork barrel scam” – a political scandal regarding alleged misuse of funds in the amount of PhP10 Billion (US$2.24M).
While anti-corruption efforts continue to face an uphill climb, it is largely conceded that the investment climate has improved, largely because the administration is perceived to take the need for institutional reform seriously. A 2013 World Bank report noted that the Philippines is now beginning to reap the benefits of political stability, a popular government, and governance reforms.
Indeed, as noted by the World Bank, one bright spot is the very active and vocal private sector, which takes the lead in promoting ethical practices and anti-corruption efforts. In particular, the business community has long understood that corruption not only exacerbates poverty, but also seriously undermines the Philippines’ long-term economic development prospects.
Recognizing these developments, TRACE International recently opened an office in Manila to meet the increasing demand for locally delivered anti-bribery compliance services. In addition, it partnered with the Makati Business Club (MBC) to help bring transparent business practices to the Philippine business community and promote a global anti-bribery and third party compliance standard, giving the private sector better tools to fight endemic corruption.
TRACE and MBC will be hosting an anti-corruption workshop on 30 April 2014, to cover a broad range of topics, including anti corruption enforcement actions in Asia, recent developments concerning the FCPA & UK Bribery Act, and compliance program best practices & risk assessments, among others.