I would like to provide an English summary of an interview with Simonetta Sommaruga, Minister of Justice of the Swiss Federal Council, by the Swiss newspaper Neue Zürcher Zeitung (NZZ) published on November 12th 2017. The interview is relevant for our class as Sommaruga discusses the issue of the “Paradise Papers” and the need for more regulations in the commodity sector. The article is titled „If the economy cannot make it, regulations are needed“(transl. from “Wenn es die Wirtschaft nicht schafft braucht es Regulierungen”). The article is also available here in German.
In the article, Sommaruga explains that it is widely known how Africa’s population is taken advantage of by international corporations and corrupt officials and that she feels personally affected by the fact that 70% of people affected by extreme poverty, in fact, live in resource-rich countries. When addressing a specific revelation by the Paradise Paper, namely the controversial connection between Swiss-based multinational Glencore and the state Congo, Sommaruga argues that the Federal Council advocated already three years ago that more anti-corruption measures are needed for the commodity sector and that the parliament is discussing such a measure right now. However, she adds that the Federal Council is not in a position to prescribe companies with whom they can conduct business.
When asked about the reputational risk that Switzerland faces in response to the Paradise Papers she agrees that the risk is immense and that it is not recommended to only act on this issue after being put under pressure by the International Community. Hoping that Switzerland will proactively put in place measures to increase transparency measures within the industry, she explicitly mentions the anti-corruption measure for commodity extraction.
The article also touches upon the chicken-or-egg-question which was raised discussions in class before: Is it the companies’ fault who provide incentives for corrupt behaviour or is it the government officials are easily engaging in corruption? Sommaruga replies by using the analogy of a Tango, a dance which needs two actors – corrupt officials taking advantage of situations but also companies who are ready to do business with such people and thereby become complicit. The companies would take advantage of certain states’ lacking justice system and functional criminal enforcement system. The Federal Council therefore expects that companies abide by Swiss laws which say that bribery of foreign government officials is forbidden.
The interviewer points out towards the end that many other states have imposed due diligence obligations on multinationals but that Switzerland is lacking those. To this incur, Sommaruga replies that this obligation is part of the Swiss Coalition for Corporate Justice SCCJ (transl. from “Konzernverantwortungsinitative”) which the Federal Council opposes because it goes too far. However, the Federal Council does agree that there is a need for more action. A factsheet for the initiative in English can be found on this website. The Swiss people will vote on this Popular Initiative earliest in 2018.
(Picture by Sebastian Magnani)
