Creating fair market conditions with the Siemens Integrity Initiative
Siemens has launched the worldwide Siemens Integrity Initiative with a budget of US$100 million. The initiative will support organizations and projects dedicated to fighting corruption and fraud through collective action – joint activities by companies and institutions – as well as through vocational training and continuing education. The initiative is committed to supporting ethical market practices and fair competition.
On July 2, 2009, the World Bank Group announced a comprehensive settlement with Siemens. Under its terms, all investigations by the World Bank Group into allegations of corruption at Siemens were terminated. In return, Siemens agreed to cooperate in efforts to change industry practices and clean up procurement activities as well as to join the World Bank Group in collective action to fight fraud and corruption. In this connection, we’ve set up the Siemens Integrity Initiative with a budget of US$100 million. This money will be spent over a period of 15 years and distributed in a number of rounds. The World Bank Group is entitled to audit how the money is used and may veto the selection of anti-corruption groups or programs.
Only when we jointly fight against corruption can we achieve fair market conditions worldwide.
Successful launch of the initiative
The first round, which was launched on December 9, 2009, International Anti-Corruption Day, will provide funding of around US$40 million. Further rounds for distributing the remaining US$60 million will be announced separately at later dates. “Siemens stands for ethical and sustainable business,” commented Peter Y. Solmssen, member of the Managing Board and General Counsel of Siemens AG, when the first round was launched. “This initiative will boost our efforts to promote greater business integrity and fair market conditions globally. We’re looking forward to making this a joint success with the World Bank and other partners.”
In the first round, approximately 300 applications were submitted from 66 countries for the two main areas of collective action and education and training. Both international as well as regionally active organizations applied. The selected project proposals will be announced in the fall of 2010.
Building worldwide alliances against corruption
The selection process favors projects that contribute to the development of fair market conditions and that aim at strengthening compliance standards and legal systems. Where possible, the projects should also be located in business areas and countries where Siemens is also active.
Why Siemens supports collective action
Collective action means jointly combating corruption and forming anti-corruption alliances with a variety of interest groups. It aims at promoting fair competition, where the best bidders are awarded contracts in transparent processes that are determined solely by market conditions – in particular, quality, price, innovation and service. In other words, in fair market conditions where competition is not distorted and/or excluded by corruption and where companies acting ethically are not at a disadvantage.