Policy Brief

Key Takeaways from B20 South Africa Task Force on Integrity and Compliance Final Paper

Introduction

In an increasingly interconnected world, integrity and compliance are central components in ensuring that economic flows and investments are safe and secure. To foster sustainable economic, social and environmental progress, B20 members have put forth recommendations through the B20 South Africa Task Force on Integrity and Compliance Final Paper.

Recommendation 1: Encourage the responsible use of technology in integrity and anticorruption measures

Recommendation 1.1: promote the adoption of international frameworks for the responsible use of technology in anti-corruption and integrity measures.

With the increasing adoption of digital platforms to facilitate commerce and rapid development of emerging technologies like artificial intelligence (AI), governments are increasingly leveraging these tools to boost operational efficiency and resilience. Therefore, the global community requires internationally ubiquitous frameworks on auditing public use of digital technologies to strengthen integrity and tackle corruption. Specifically, these audits would enhance credibility and cross-function collaboration, strengthen risk management and control frameworks, and enable continuous monitoring and real-time assurance.

Additionally, the Task Force on Integrity and Compliance recommends that G20 nations take initiatives such as implementing appropriate oversight mechanisms, embedding ethical standards for the responsible use of digital technologies, and strengthening public-private collaboration on joint AI initiatives.

Recommendation 1.2: establish secure and inclusive digitally driven whistleblowing platforms for reporting suspected integrity breaches.

The effective protection of whistleblowers and implementation of anti-retaliatory measures is a central component of any integrity ecosystem. Therefore, G20 nations must implement regulatory and institutional frameworks to protect whistleblowers. The B20 Task Force on Integrity and Compliance encourages the implementation of digital platforms that promote a transparent environment, which would decrease retaliatory actions against whistleblowers. Specifically, the Task Force recommends that G20 nations enforce comprehensive protections for whistleblowers and embed provisions in national whistleblower legislation/frameworks.

Recommendation 1.3: promote the use of digital identity integrity tools, such as the Legal Entity Identifier (LEI), to enhance transparency.

LEI frameworks enable verifiable, interoperable and globally trusted systems because they provide precise identification of legal entities participating in financial and commercial activities at no cost. In turn, this provides global public and private institutions with greater transparency and accountability and disincentivises corruption. Moreover, LEIs support international stakeholders by facilitating risk assessments and screening capabilities which can be used by governments to identify beneficial owners and enforce sanctions. Therefore, the B20 Task Force explicitly calls on the G20 grouping to endorse and adopt LEIs within their digital and public procurement pipelines.

Recommendation 2: Strengthen integrity embedment in climate and sustainability finance systems

Recommendation 2.1: leverage existing sustainability due diligence standards that promote integrity, particularly for climate finance, and promote the adoption of international sustainability reporting, sustainability assurance and sustainability ethics and independence standards in local jurisdictions and territories.

Increasing global industrialization has been directly linked to growing extreme weather events and other negative environmental externalities, which has put significant pressure on the international community to address pressing sustainability-related matters. However, at the same time, sustainability initiatives have significant social and economic costs, particularly for developing countries. Therefore, the B20 Task Force on Integrity and Compliance advocates for the implementation of equitable sustainability standards that do not place prohibitive barriers on firms operating in emerging markets. Moreover, it calls on corporations to integrate organizational sustainability initiatives to improve governance and decrease emissions from organizational processes.

Specifically, the Task Force calls for the G20 to take the following initiatives. First, the G20 should advocate for and endorse the convergence of global standardized frameworks to bring recognizable, widespread sustainability protocols. Next, the Task Force advocates for greater transparency and integrated reporting frameworks to have consistent accreditation and oversight through a unified legal and regulatory approach. Finally, the B20 Task Force calls for the G20 to support sustainability reporting in the public sector and the International Public Sector Accounting Standards Board’s (IPSASB) work to develop climate-related disclosure standards.

Recommendation 2.2: create a global climate finance transparency registry that tracks funding flows, outcomes and integrity safeguards, co-designed with multilateral institutions, and supported by independent verification mechanisms that address governance and data limitations at the national level.

To prevent funding allocated towards mitigating environmental challenges from being siphoned or misappropriated, the B20 Task Force on Integrity and Compliance calls for the implementation of a global climate finance transparency registry. This platform would enhance international coordination and share information across borders to improve transparency and accountability. Moreover, the B20 Task Force advocates for the development of a dedicated climate finance red flag index that would detect risk on governance, financial integrity, and compliance issues.

Recommendation 3: Amplify Collective Action and integrity standards for inclusive growth

Recommendation 3.1: strengthen support and incentives for organisations to engage and drive Collective Action for inclusive growth.

The Task Force advocates for greater Collective Action initiatives to tackle integrity risks, strengthen market fairness, and contribute to a more inclusive economy. By incorporate diverse perspectives across multiple spheres of global society, Collective action is more accountable and equitable which builds trust through engagement, influences the business environment by setting standards, and ensuring a level of commitment to mitigate the free rider problem.

Therefore, the G20 should promote and establish Collective Action integrity mechanisms to reduce corruption and develop structures to increase participation. Moreover, the B20 and G20 should both facilitate public endorsement and provide leaders with adequate capacity and resources to build legitimacy on Collective Action programs and provide high-level recommendations to improve upon programs.

Recommendation 3.2: expand and embed public-private partnerships (PPPs) as a tool for promoting integrity and driving inclusive growth.

PPPs serve as an important mechanism for inclusive growth by leveraging both government oversight and private sector innovation. PPPs are effective institutions in promoting integrity and compliance by encouraging transparency and integrity within systems, fostering inclusive economic participation, and improving capacity building initiatives. Therefore, the B20 Task Force recommends that G20 nations implement PPPs grounded in strong institutional commitment, regulatory support, and transparency between partners.