FINANCE

Ukraine owes it to itself and to the West to stem corruption


The second anniversary of the Russian invasion of Ukraine is a sobering moment. Among the many miscalculations made by Vladimir Putin was the notion that the West would not, actually could not, collectively respond to Russia’s takeover. He was wrong. Not only did the West unite, but it began to provide the government, the armed forces, and the people of Ukraine with a lifeline of billions of dollars in the form of loans and grants and sophisticated military equipment, as well as promises of more support in the future. The external threat of Putin was met head-on and with little equivocation from Ukraine’s coalition of allies.

However, the long, dark shadow that continued to grip Ukraine because of its Soviet legacy was the internal threat of corruption. Transparency, accountability, and just day-to-day transactions across the country have long been compromised and have posed a threat to Ukraine’s economic future and the well-being of its people. That ubiquitous concern hangs over the future of the country and its people, particularly among Western allies who are being distracted by other global concerns like the war in the Middle East.

For more than two decades, USAID has assessed corruption in Ukraine. Last year, it conducted a nationwide poll in Ukraine in which 94% of the respondents said they consider corruption to be common to some degree or another. “Gifts” to vendors, payoffs to local authorities for permits and certificates, bribes in the military-industrial complex, and under-the-table payments for academic entry are just some of the daily practices that have plagued the country.

To his enormous credit, President Volodymyr Zelenskyy has been a stalwart when it comes to ethical morality, even amid the war. Having run for office in 2019 on a clear, compelling platform of reform, he won with a landslide 73% of the vote. Overnight, his actions in office met his promises–everything from creating oversight ethics agencies to dismissing government officials who even appeared to have been compromised.

On Jan. 30, global corruption watchdog Transparency International published its global Corruption Perceptions Index, which showed that Ukraine has improved its standing by three points while Russia’s ranking declined by two points, making it the most corrupt country in Europe today. 

And yet, Ukraine still is seen as a corrupt nation by many Western business executives. “Buyer beware” has remained the cautionary warning that hangs over the country among Western concerns. Last fall, it was reported that the White House had circulated a somber, confidential analysis that solidarity for Ukraine among allies might crumble without additional concrete steps being taken to stem the perception of corruption that still bedevils the country. Spreading the perception that graft is not being taken seriously only adds to the Russian propaganda machine and feeds into those Western voices who claim that their support has not been met with a full-throated Ukrainian effort to fight graft.

Fraud and graft exist everywhere in the world, albeit to different degrees, but the need for Ukraine to cleanse a culture of everyday ethical malfeasance is critical to its immediate future. It will take time. While President Zelensky has launched a top-to-bottom cleansing of unethical practices, the country is in serious need of civil society support for anti-corruption efforts. Creative, innovative measures are needed to make Ukrainians and the global community comfortable with the country’s anti-corruption standards.

If Ukraine is to make an immediate difference in tackling this lingering stigma and change the cultural life of the country, creative and innovative steps must be taken by businesses, academia, and other entities to stem the tide. Ukraine’s business community should consider establishing a benchmark for reaching a level of business ethics for local companies. Universities should require ethics education certification for their students, particularly for business and public policy majors. Virtual lectures should be offered to the public to convey how ethics benefits the individual, community, and country. Fortunately, a historic initiative will soon be announced by the private sector to address these concerns in an ethics education program. The Ukraine Catholic University and the Washington Institute for Business, Government and Society will soon announce a countrywide ethics education program to stanch corruption in three sectors–business, government, and academia  

The West did not come together to win the war but lose the peace. Supporting Ukraine in the face of Russia’s barbarous invasion is an investment in both the future of Ukraine and that of the West. It is not a handout. By supporting Ukraine to repel Russia from its soil, we hope that the Ukrainian people will show their resolve by paving a promising future for their country and future generations.

Having the Ukrainian private sector step up its game to join its government in this cause is not just hopeful thinking but an inextricable part of the formula for future morality and prosperity. This is a key way that the West can take comfort in that it helped create a new vision and future for the people it helped ward off a brutal invader.

James P. Moore, Jr is the founder and CEO of the Washington Institute for Business, Government and Society. As the former U.S. Assistant Secretary of Commerce, he helped oversee U.S. business and was the chief U.S. negotiator for the last trade and economic agreement with the Soviet Union. Part of his government portfolio was to work with companies to ensure they did not run afoul of the Foreign Corrupt Practices Act. For the following 20 years, he taught international business as well as business ethics at Georgetown University.

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