The abuse of anonymous company structures to conceal wealth by individuals, groups, and corporations is an obstacle for domestic resource mobilization, inclusive growth, and accountable institutions.
The issue of beneficial ownership transparency took centerstage during Ending the Shell Game: A New Global Norm for Beneficial Ownership Transparency, an expert panel discussion held in the World Bank’s Preston Auditorium on December 9, 2019, International Anticorruption Day.
World Bank’s Vice President of Equitable Growth, Finance and Institutions, Ceyla Pazarbasioglu, started the conversation by stressing the corrosive effects of corruption on public trust in institutions and the World Bank’s twin goals of poverty reduction and inclusive growth. The panel discussion was moderated by Thom Townsend, Executive Director of Open Ownership with a diverse set of experts: Rhoda Weeks-Brown, General Counsel and Director of IMF’s Legal Department; Alex Cobham, Chief Executive of Tax Justice Network; Andrej Leontiev, Partner, Taylor Wessing; and David Szakonyi, Assistant Professor of Political Science, George Washington University.
Together, they highlighted the connections between mobilizing finance for development and made a compelling case for the vital importance of this policy issue.
A main takeaway from the discussion is that countries lose out on valuable resources that could be used to meet development objectives when wealth can be hidden through anonymous company structures. Although making data open and transparent to the public is an important first step, the panelists agreed that governments, multilateral institutions, civil society, and the private sector will have to work together to build capacity so that this information can be used to implement change.
A coalition of governments led by the UK is committing to a global norm on beneficial ownership transparency and is looking to the international community to create momentum behind this change of norm. This agreement marks a milestone in efforts to improve transparency and governance, which is vital in strengthening development programs and is an IDA-19 cross-cutting theme. Initiatives like these are crucial to reduce the abuse of anonymous company structures to divert public funds for private gain.
If you missed the event, replay the video and tell us what you think in the comments or by using the #UnitedAgainstCorruption hashtag on Twitter.