The Un Global Compact Underlines

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The UN Global Compact underlines ‘Corruption is now recognized to be one the world’s greatest challenges’. Similarly, underlining its significance Kofi Annan argues ‘Corruption hurts the poor disproportionately – by diverting funds intended for development, undermining a government’s ability to provide basic services, feeding inequality and injustice and discouraging foreign investment and aid’ (Adeyeye 2012: 2). In addition to the importance of corruption in the policy agenda, there is emerging consensus in academia, empirically as well as theoretically, that corruption has detrimental effects on society on different levels. Odell (2010) describes it as a ‘systematic disabler’ damaging economic and human development and adding …show more content…

Corruption is described as a ‘very undesirable consequence’ of rentier states for oil companies by an interviewee (Industry Expert, Email correspondence 2015). As a result, corruption has a major influence on oil companies , which need to work closely with governments, handle with large amounts of money and ultimately depend on the government’s permission to operate (NGO Expert, Independent Expert, Interviews 2015). Consequently, the private sector faces a corruption dilemma since it can be the source or victim of corruption. In 2004, the fight of corruption became the 10th principle of the Global Compact, underlining the important role business plays (Globalcompact. Com). These social implications of corruption underline the social relevance of conducting research about the topic. Mainstream literature (e.g. theory of firms) assumes that there is a separation between politics and business and companies are rather unwilling to intervene in domestic politics (Friedman 1962; Henderson 2001) ‘It is not a corporation’s responsibility to fulfil the obligations of states, particularly since it could jeopardize their relationship with the government’ (Rosenblum, Maples 2009:xx). Oil companies depend on a host (country of operation) government’s licence to operate in a

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