National Anti-Corruption Advisory Council established in South Africa

The body was established by South African president Cyril Ramaphosa. The move follows the conclusion of a judge-led inquiry into allegations of ‘state capture’ in the country. Ramaphosa’s formal response to wide-ranging recommendations of the Zondo Commission is due to be presented to South Africa’s parliament by 22 October this year.

“Whilst Zondo did not recommend the formation of the National Anti-Corruption Advisory Council, it is a step in the right direction and perhaps a pre-cursor to the Anti-Corruption Authority orAgency of South Africa (ACASA) that the Zondo Commission has recommended should be established,” said corporate crime risk expert Edward James of Pinsent Masons in Johannesburg.

“Based on the recommendations of the commission, the ACASA should be led by a Council made up of persons from specific backgrounds. Whilst the president has included high caliber council members in his advisory council, it could benefit from the inclusion of a seasoned bribery investigator or lawyer who has experience helping organisations turn-around after large-scale corruption scandals,” he said.

The National Anti-Corruption Advisory Council is made up of nine members. Each will serve three-year terms, which started on 1 September 2022. The Council is chaired by Firoz Cachalia. Cachalia is a professor at the University of Witwatersrand School of Law in Johannesburg and has held a number of posts in the public and private sectors, including head of the Planning Commission in the Gauteng provincial government.

In a statement, the South African government said that the National Anti-Corruption Advisory Council “will advise government on the critical preventative measures, institutional capabilities and resources that are required to proactively curb a recurrence of state capture and to prevent fraud and corruption in South Africa”, as well as “advise on the effective implementation of the national anti-corruption strategy by government, civil society and the private sector, and on strengthening of South Africa’s anti-corruption architecture”.

The government also said the Council will engage with business groups and other stakeholders “to further develop the country’s anti-corruption agenda and evaluate progress in the implementation of the anti-corruption strategy”.

London-based corporate crime specialist Neil McInnes of Pinsent Masons said: “Internationally, the Zondo Commission demonstrated the real impact of tackling ‘grand corruption’ and investigating allegations of ‘state capture’ by using a commission of inquiry structure. The model that South Africa chose equipped the commission with wide powers to call for evidence, to report its detailed findings as well as to make recommendations on law reform and systemic improvements to transparency. Its work will have a long legacy as well as be a repository of information for others across borders, similar to other watershed cases globally from the Panama Papers to the Volcker Committee.”

“Other jurisdictions have taken note and we can expect to see the adoption of similar models to the Zondo Commission elsewhere over the coming years – using thematic reviews, commissions and other similar structures in combination with traditional law enforcement tools, especially where countries are faced with the most difficult and complex controversies,” he said.

“South Africa’s formation of the National Anti-Corruption Advisory Council is similarly innovative. It will set a precedent others may follow across the world. It will be watched closely by the global anti-corruption community and is an example of the importance of strong public-private partnerships as part of the toolkit to fight corruption – to provide scrutiny, oversight and checks and balances over those at a state-level responsible for anti-corruption laws and their enforcement,” McInnes said.

McInnes said that the participation of society, including businesses, as an anti-bribery preventative measure is advocated in global anti-corruption instruments, such as the 2004 UN Convention against Corruption.

According to Article 13 of the Convention, a signatory state “shall take appropriate measures, within its means and in accordance with fundamental principles of its domestic law, to promote the active participation of individuals and groups outside the public sector, such as civil society, non-governmental organisations and community-based organisations, in the prevention of and the fight against corruption and to raise public awareness regarding the existence, causes and gravity of and the threat posed by corruption”.

“Public-private partnerships offer opportunities for businesses globally and can assist the effectiveness of their compliance programmes,” said McInnes. “In higher risk markets, these channels can offer practical solutions to companies faced with entrenched corruption risks, such as where demands for facilitation payments may be prevalent.”

“Equally, when responding to corruption incidents, businesses increasingly need to take account of the reactions not only of law enforcement agencies and regulators but interested parties across a wide spectrum of civil society. Remediation measures by businesses are often most successful where there has been a proactive dialogue with this wider stakeholder community,” he said.

The involvement of business representatives specifically in addressing corporate crime was a core pillar of the UK government’s economic crime plan for 2019 to 2022, according to Fiona Cameron of Pinsent Masons.

The plan states that “successfully combating economic crime can only be achieved by a public-private partnership” and it sets out a vision “for the public and private sectors to jointly deliver a holistic plan that defends the UK against economic crime, prevents harm to society and individuals, protects the integrity of the UK economy, and supports legitimate growth and prosperity”.

The Economic Crime Strategic Board is an example of a PPP that has been operating to deliver the plan. It is a ministerial-level public-private board charged with setting the UK’s strategic priorities for combatting economic crime. Other UK PPPs active in respect of corporate crime include the Joint Money Laundering Intelligence Taskforce (JMLIT) and the Joint Fraud Taskforce (JFT).

Cameron said: “The National Anti-Corruption Advisory Council in South Africa’s role is interesting – not only to advise on effective implementation of an anti-corruption strategy, but to provide ‘advocacy and action’, including input on the government’s response to the Zondo Commission recommendations. The apparent commitment to introduce that PPP at such an early point in the process – not simply to assist in delivering on a strategy already centrally determined but to be part of the development of that strategy, together with an ability to hold the government to account for delivery – will be watched with interest. The detail of what is meant by ‘advocacy and action’ will be crucial here.”

“The appointments signify a determination to stamp out corruption in the country and to utilise the resources available to ensure this is done in a coordinated, efficient, and effective manner. While success will depend on the level of real commitment to make change at all levels, this is a positive step and a signal that the president intends to make good on his commitments,” she said.