The World Bank was this week criticised for its 'heavy handed' policy of naming and shaming corrupt firms by the International Federation of Consulting Engineers (FIDIC).
FIDIC Secretariat managing director Enrico Vink said penalising individual companies in countries where corruption was rife failed to address the root cause of the problem. 'The market is reacting to the World Bank approach,' added Vink. 'Companies that used to bid for those projects were top line firms, but they have stopped bidding and that's affecting the quality of work. 'Why take that risk of being penalised when there are private sector clients willing to work with you under more reasonable conditions?' he said. In August the World Bank launched a corruption amnesty allowing firms on its infrastructure projects to report government and individuals involved in corruption without fear of reprisal (NCE 24/31August). The bank's Voluntary Disclosure Programme (VDP) came at the same time consultant WSP was revealed to be under investigation by the Indonesian government for corruption on two World Bank funded projects. Vink said that while FIDIC had yet to form a specific position on the VDP, the organisation was putting together its own tool to tackle corruption. 'We are working on a tool that the banks can use practically,' said Vink. 'It would provide the client with a series of checks and balances to ensure that the project was procured in a way that maximised transparency.' Vink added that the tool would not completely eradicate corruption but was hopeful that it would be taken up by all major banks funding developing world projects. FIDIC is currently in preliminary talks with the banks, with a final decision on the use of the tool likely to be made in May 2007.