Challenges
OAGI expects the number and complexity of complaints to increase, each of which requires careful, thorough, and discreet handling. Ideally, each investigator should work with one investigative analyst. OAGI has requested for an additional support staff for 2008 and will continue to engage staff consultants, as required, to complement its workforce and to ensure that professional staff members with the appropriate skills mix are recruited for vacant positions.
OAGI will also face significant constraints in sourcing qualified and affordable external auditing services for the conduct of the six PPRAs planned in 2008. are planned for projects located in Afghanistan, India, Kyrgyz Republic, Mongolia, Sri Lanka, and Viet Nam. Careful forward planning and tough negotiations will be required to successfully recruit appropriate external local expertise to assist with the conduct of the PPRAs. Additionally, security constraints may impact on the implementation of certain It is acknowledged that even the best forward planning may be thwarted. Thus, OAGI anticipates that it may need to defer/replace certain PPRAs in recognition of the aforementioned constraints.
A big challenge for OAGI as it enters its eighth year of operation is to update its information technology systems. The current case management system requires supplementing to enable it to generate data based on complex sets of criteria. This is especially critical as OAGI grows and higher levels of information technology security are required.
Furthermore, OAGI plans to significantly enhance its intelligence storage and analysis capacity. OAGI has submitted a modest budget request in 2008 to support limited modifications to its existing information technology systems, but more will be required in future years.
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Staff must be at the forefront of its anticorruption drive and must understand their responsibility to abide by the highest ethical standards.9 However, with the increasing bombardment of information through electronic highways and other channels, it is a challenge to ensure staff understand and absorb what is expected of them, as well as understand the consequences of not meeting those expectations.
The consequences of staff not adhering to behavior and disclosure requirements expose them to disciplinary procedures and sanctions. On the one hand, staff have to be vigilant of their own conduct; on the other, they are to identify and report unethical conduct of other staff when appropriate. ADB, through OAGI and BPMSD, is also obliged to ensure that appropriate consequences are delivered fairly and promptly.
The challenge is to ensure that every staff is pro-active in preventing unethical behavior and fraud and corruption within ADB and in any activity financed by ADB. The number of complaints lodged by staff, while still significant, decreased in 2005 through 2007, after achieving a high in 2004 (Figure 14). Additional effort must be made to effectively ensure that anticorruption remains at the forefront of staff consciousness in order to sustain their vigilance and watchfulness.
Recognizing this challenge, in the short term, OAGI plans to review and supplement, where necessary, the existing anticorruption policy and Integrity Principles and Guidelines with more detailed implementation procedures that govern ADB's stand on fraud and corruption in order to enhance accessibility, readability, and clarity. In 2008, OAGI plans to release a handbook for staff and to increase its outreach efforts to staff in a variety of ways. (See also the section on Raising Awareness on the Damaging Effects of Corruption and the following section on Whistle-Blower Protection.)
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While an effective OAGI may be considered central to ADB's anticorruption drive, a comprehensive, holistic approach to anticorruption will require much more. A comprehensive approach to anticorruption must incorporate "a widely understood policy framework, consistent systems and processes among operational groups, defined responsibilities, and effective educational, training, and communications arrangements."10 OAGI recognizes the need to work more closely with other integrity-oriented parts of ADB, such as the Office of the General Counsel, and the governance functions within the various operational departments and the Regional and Sustainable Development Department (RSDD).
In this way, ADB will be able to maximize efficiencies to ensure that the project cycle inherently incorporates anticorruption elements in all its stages. While acknowledging that consequences of fraud and corrupt practices must be clearly spelt out at the planning stage, and that checks and balances should be incorporated into project implementation and monitoring to identify and deter such practices, OAGI has, thus far, not lent its investigative and audit expertise significantly to these areas. Furthermore, OAGI has not yet contributed to promoting the incorporation of anticorruption measures into country partnership strategies (CPS), which also present opportunities to address anticorruption measures for ADB projects.
While OAGI's mandate includes the prevention of fraud and corruption, and the provision of anti-fraud and corruption training and the promotion of fraud and corruption awareness, current staffing levels constrain OAGI's activities in this area. It is, therefore, necessary for OAGI to develop more innovative methods of intervention that rely less on continuing staff involvement and maximize collaboration with other integrity-oriented parts of ADB. In 2008, OAGI management will prioritize the development and introduction of the necessary innovations.
As with prior years, in 2008, OAGI will continue to deliver the RETAs and to utilize its PPRAs also as a means to enhance prevention and detection of fraud, corruption, and other forms of abuse. will also continue to be used as a catalyst for training DMCs as will more conventional platforms, such as seminars and workshops. In 2008, OAGI plans to conduct six PPRAs.
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ADB's Integrity Principles and Guidelines provide that ADB will, within the limits of its abilities, protect any party that conveys in good faith a concern, allegation, or evidence of fraud, corruption, or abuse.11 They also provide that OAGI will use its best efforts to encourage and protect whistle-blowers and witnesses and will protect their identities from unauthorized disclosure throughout and following an investigation.
ADB is, however, very limited in the steps it can take to protect whistle-blowers and witnesses who are not ADB staff. Its processes for implementing the anticorruption policy are administrative in nature-as such, the level of protection ADB accords to the whistle-blower is not as comprehensive as it might be if there were legal or judicial processes. ADB cannot interfere should the whistle-blower or witness be subject to unique legal processes in any of ADB's member countries; provisions of national whistle-blower legislation, if any, vary greatly among ADB member countries. There are also countless subtle ways to undermine the whistle-blower or witness, over which ADB would have no control.
OAGI treats the source of any allegation or evidence with utmost confidentiality. OAGI limits the circulation of any information regarding an investigation strictly to those with a need to know and protects the identity of the individual who makes a report to OAGI. Unauthorized disclosure by staff of the identity of a whistle-blower renders him/her exposed to disciplinary procedures. OAGI has observed that staff (at all levels) have limited understanding of their responsibilities with respect to whistle-blower protection.
Therefore, in 2008, OAGI plans to deliver, in cooperation with RSDD and BPMSD, seminars that will train staff in, among other things, the appropriate processes to employ when receiving and handling allegations of fraud and corruption, which will enhance OAGI's ability to maintain confidentiality and protect whistle-blowers.
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In OAGI's 2006 Annual Report, OAGI identified that maintaining OAGI's independence is imperative to its ability to effectively discharge its responsibilities. OAGI was housed within OAG to provide the greatest possible and fully effective independence from ADB's operations. While combining the auditing and investigative functions under OAG has operated well enough to date, consideration should be given to observing recommended best practices for MDBs. In his report, Independent Panel Review of the World Bank Group Department of Institutional Integrity (September 2007), Paul Volcker noted and upheld the acceptability of the "standard model" as practiced by international institutions. The so-called "standard model" is for the integrity function to be a free-standing unit, with a direct reporting line to the President and a concurrent reporting line to the Audit Committee of the Board.
As noted in OAGI's 2006 Annual Report, this issue will need to be considered by ADB in light of the ever-increasing demands and expectations that are placed on the integrity and auditing functions of our institution, and in keeping with best practices.
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9 These are underpinned by the anticorruption policy 2 July 1998, Integrity Principles and Guidelines November 2006, and the Code of Conduct as outlined in AO 2.02, Section 4.
10 Report of the Independent Review Panel of the World Bank Group Department of Institutional Integrity. September 2007. para. 28.
11 ADB does not currently have a specific Whistle-blower Policy as such. In keeping with global trends, in the future, ADB may need to address whether a dedicated policy is required.
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