Daily Times

The world moves, haltingly perhaps, towards greater transparency yet Pakistan scuttles ever quicker towards blessed opacity. The profit-motive, reviled by some, is still grudgingly accepted as the engine that drives our markets and encourages the innovation that fuels economic growth. But the appropriation of the profit-motive by government, a hallmark of the developing world, has earned itself a growing, implacable condemnation that is creating a sea change in attitudes towards governance.

Achieving aims via clandestine attacks is a diamond-backed strategy in the business world that creates a hard to dislodge fait accompli. And government in Pakistan is a business – albeit a poorly run, lumbering dinosaur with a Balance Sheet perpetually in the red. All across the world businesses fail with the root cause being poor management, because it is management that takes those unwise, poorly thought-out decisions that sink their shareholder’s money and trust. Efficient management and transparent operations are of great value in the market and myriad laws, rules, and regulations have been enacted and are rigorously enforced to ring fence appointments and processes, thus underscoring the vital importance of the relationship between investor and company. So why is it that Pakistan Inc. and it’s management practices fly free and are untrammeled by strictly enforced rules and regulations that protect its shareholders, aka the citizenry?

A lack of independent checks and balances, no focused oversight of operations and gossamer rules and regulations allow us to operate on the basis of quid pro quo, where unsound appointments to vital management positions are accepted as being part and parcel of the democratic system of government. Conflict of Interest (CoI) doesn’t really require long-winded explanations as it simply describes the age-old conflict between an individual’s natural self-interest and his chosen duty to others. Self-interest is a powerful force of nature that can only be reined in by the creation and application of strong, clear rules and regulations. Service and adherence to duty are not in-born characteristics but rather require skilful, regular applications of both the carrot and the stick, and this is where we fail because here the carrot is anemic and the stick is broken.

The nexus of the power brokers and special interest groups will forever throw up more and more cases where corruption and bias are the hallmarks of public decision-making

Governance that allows these conflicts is opening one of the many doorways that lead to corruption, inefficiency and the ultimate weakening of the democratic system as the trust between voters and leadership erodes under the pressure of the leader’s choices. Only in Pakistan does democracy demand a medieval King’s powers of appointment for its leadership, free of any constraints regarding appropriateness of position, ability to carry out duties or separation of public and private interests. To that end, we have decided to redefine the concept of CoI, narrowing the definition of ‘private interests’ while obscuring the boundaries of ‘public duties’ through the proliferation of grey zones consisting of contractual appointments, PPVs and the contracting out of public services. With great deliberation and impressive insidiousness, we have dismantled the scaffolding that public duty requires if it is to eclipse the intrinsic nature of naked self-interest.

A great deal of thought, investigation and writing has been devoted to the ethics of this issue by many reputable institutions including the OECD, Transparency International, the UN and many others. The damage to anti-corruption measures that is caused when countries sweep things under the carpet is immense, but how do we measure the damage when a country is actively blurring the boundaries between public and private interests and duties? Every set of management techniques that deals with Conflict of Interest requires a transparent and clear declaration of private interests by the individuals in question, and, while each country has its own methodology, per Transparency International, ‘an unambiguous legal definition of conflicts of interest is an essential part of any public sector integrity system’.

Pakistan needs qualified, experienced people setting policy and making critical decisions and as humans do not live in a vacuum, it is to be expected that they would have links to and ownership of private sector entities. The problem occurs only when they set policy, make decisions, and authorize contracts for the industry within which lie their private, financial interests. Good governance and best practices would require the removal of those individuals from the decision-making process to stem any accusations of impropriety or unfair advantage. It is the duty of government to make public any such conflicts along with measures taken to mitigate their effects and preserve the perception of integrity and trust that is a vital component of democratic government.

Transparency is becoming the clarion call for much of the younger generation of educated Pakistanis who, through their own reading and research and courtesy the immensely sound investigative reporting of the Pakistani media, are disgusted by the many sordid tales of influence peddling and blatant conflict of interest issues. Pakistan’s influence peddlers have been operating unmolested for such a large part of our history that subterfuge and the softly-softly approach has morphed into King Kong stomping around in hobnailed boots. The nexus of the power brokers and special interest groups will forever throw up more and more cases where corruption and bias are the hallmarks of public decision-making. Pakistan’s intense yearning to be a destination for foreign investment, which takes a hit every time the Corruption Index is glanced at, will remain a pipedream if we are unable to break the culture of mutual back-scratching and the elevation of private interests over public duty.

Much of the developed world has in place robust systems to preserve the integrity of public decisions. Internal ethics commissioners, independent appointment scrutiny bodies, new offices focusing on Conflict of Interest issues are all bolstered by clear guidelines regarding complete disclosure of all financial and other interests, rigorously enforced steps for recusal or transfer of any official whose decision making might be perceived as biased due to his private interests, and legislation that supports scrutiny and oversight. The post-Covid world will be a place of intense, cut-throat competition where countries will fight harder for more limited global resources and each flaw and disadvantage will be magnified many times over. The world’s perception of the Pakistani way of doing business and embrace of practises that are being legislated away in other countries under zero-tolerance corruption policies will cost us dearly.

The writer is an investment analyst and can be reached at raanas@gmail.com