Integrity management should be integral in Bay Area development
In a keynote address marking the recent 40 th anniversary celebration of the Shenzhen Special Economic Zone, President Xi Jinping outlined 10 key points in the future development of the region. Point No 7 says “the government must adhere to scientifically developed legislation, strict law enforcement, and fair justice so that the rule of law becomes an important guarantee for the development of the special economic zone”.
In point No 2, President Xi emphasized that Shenzhen should not serve merely as the center for domestic economic development, but also as a gateway to the whole world.
This is clearly a statement of high moral vision. For any reform, especially economic reform, to be successful, it must install the rule of law at its foundation. And for the rule of law to be effectively applied, all stakeholders, including the legislators, law enforcement agents and judicial officers, should have a high degree of integrity to achieve fair justice. This is particularly important if Shenzhen, and indeed the Guangdong-Hong Kong-Macao Greater Bay Area, wishes to attract foreign investment and participation. It must generate confidence among foreign investors that all business transactions in the Bay Area will be carried out on a level playing field, and that there is no need to go through back doors. Hence, every effort should be made to create a culture of high integrity and stringent accountability enforcement in both the business and government sectors.
To achieve this objective, both Hong Kong, with its 46-year excellent anticorruption track record, and Shenzhen, renowned for its innovation, should collaborate to develop the Bay Area into an “integrity island”, as a model to the whole of China and indeed the world at large.
Firstly, the Bay Area should set a standard of integrity management systems for all governments and business enterprises operating in the region. The Hong Kong Independent Commission Against Corruption has an unparalleled 46 years of successfully promoting corruption prevention and integrity systems in both government and business institutions, and it has come up with a detailed list of organization integrity standards and an anti-corruption checklist. Shenzhen, Hong Kong and the rest of the Bay Area should put their heads together to design an integrity standard tailor-made for the Bay Area, which should be adopted by all government institutions and major business enterprises.
The integrity management framework should require every institution to set up a steering committee on integrity management, publish its ethics policy and code of ethics, provide integrity handbooks for its managers, and appoint a special integrity manager, answerable to top management, to oversee the integrity management program.
As for the scientifically developed legislation, it can draw on international best practices on anti-corruption law. One particular area is the need to introduce conflict-of-interest law and the requirement to declare conflicts of interest. The case of former Hong Kong chief executive Donald Tsang, who was prosecuted for failing to declare a conflict of interest in a meeting of the Executive Council, could be used as an example of the high standard of public integrity that should be applied across the board in Bay Area.
The Bay Area can take advantage of the high technology in Hong Kong and Shenzhen to adopt common information and communication technologies to facilitate openness and transparency in their governments, through the innovative e-government approach as an effective solution to corruption. E-government can enhance transparency, streamline procedures, and reduce under-the-table dealings, especially in public procurement.
The Hong Kong Monetary Authority has been taking a leading role to promote regulatory technology, or regtech, in Hong Kong, which is an instrument harnessing the power of technology to create positive transformation of risk management and regulatory compliance processes in the banking sector. Regtech can be further developed to become the standard for the Bay Area’s financial sector.
In terms of strict law enforcement, the Bay Area should strictly follow Xi’s directive that “both the big tigers and small flies” should be caught. Zero tolerance of corruption, even petty corruption, should be the norm in the Bay Area.
Ideally, the Bay Area should set up a central anti-corruption coordination center with representatives from all the regional governments. It can have multiple functions, acting as a research center and training academy as well as an ethics development center similar to that of Hong Kong, providing advice to business enterprises. It can also coordinate enforcement matters and mutual referral of corruption complaints. The center can be located in Shenzhen for convenient travel by all.
When China hosted the G20 conference in Hangzhou in 2016, Xi initiated the setting up of a G20 Research Center on Anti-corruption, Fugitive Repatriation and Asset Recovery, as a platform for G20 members to exchange experiences through academic research and training. It is located in Beijing Normal University. Perhaps consideration can be given to relocate this center to Shenzhen, so that Shenzhen can enhance its international image as a global center for fighting corruption.
In point No 2, President Xi emphasized that Shenzhen should not serve merely as the center for domestic economic development, but also as a gateway to the whole world.