The word "corruption" means the abuse of public trust for private purposes. It is a moral phenomenon, even though money is involved in the vast majority of cases. A public office is used for the benefit of one or more individuals, rather than in the national interest. Corruption may exist independently of any financial benefit; it is universal and multiform, and exists within non-governmental organizations. There are several definitions of corruption in existence but it can be said simply that corruption means the abuse of an office for personal ends. This office may be public or private but corruption is usually regarded as a public phenomenon. An individual abuses the public confidence placed in him to serve his own interests or those of the group to which he belongs. To understand the many forms of corruption, it is first necessary to consider the nature of the situations and persons concerned: civil servants, businessmen, private individuals or companies using the same processes. The external factor intervening in the decision-making process influences the unwarranted benefit to the decision maker or executive in the form of a gratuity or the promise of a gratuity.
Corruption affects all sectors of both public and private economic life. The existence of a public sphere and a private sphere is a prerequisite for corruption, but certain differences can be observed in the interests pursued. A businessman, working within the law, who slips an inducement across the table is generally pursuing an end corresponding to the interests of his company. The act - though reprehensible - thus comes within the framework of the normal operation of the enterprise. This is also the case of the politician who, in his own interest or in that of his party, tries to cover up a financial scandal but cannot do so without the help of other persons whose action or inaction he purchases. Another area very propitious to corruption is nepotism. This is a phenomenon extremely difficult to pin down but, since the criterion of competence has been replaced by that of favouritism, it creates between the decision maker and the beneficiary of the decision a link of dependency which may well influence future decisions.
The corrupted and the corrupter are not accomplices: each is the perpetrator of a distinct offence, subject to its own procedures and punishments. Moreover, corruption must be distinguished from the traffic of influence that one individual exercises over others to persuade them to refrain from carrying out one of their duties so as to give him an undue advantage. Both the corrupter and the corrupted can be civil servants, State agents, private individuals or elected officials. Corruption thus creates a dual responsibility: the corrupted (the passive subject) is just as responsible as the corrupter (the active subject). This dual responsibility gives rise to the fact that both parties are liable to punishment. Corruption can also engage the responsibility of the State if the latter is organizing it through the operation of its organs or when, by a permissive attitude, it accepts the fact that private entities or private individuals are practising it.
The internal corruption described above can have several connections in other countries: it then becomes transboundary and is carried out by private companies or individuals on a large scale and involving several States. Corruption, whatever its perpetrator and its extent, constitutes economically speaking a serious obstacle to the economic and social development of the countries affected. Thus, poisoning as it does the economy and the social fabric, corruption violates the economic, social and cultural rights as well as the right to development and to a healthy environment of the peoples and population sectors concerned.
The Interregional Seminar on Corruption in Government, held under the auspices of the United Nations at The Hague in December 1989, in association with the Department of Technical Cooperation for Development, identified impunity as an underlying element of the various forms of corruption. The Eighth United Nations Congress on the Prevention of Crime and the Treatment of Offenders, held at Havana from in 1990, noted in its resolution 7 on corruption in Government that that form of corruption was universal and that it had deleterious effects on the economies of all countries, but particularly those of the developing countries. Nowadays, this corruption is developing on a world scale. At the international level, it is harmful to the economies of the countries individually affected and, moreover, amplifies the imbalances caused by the world economic order as a whole.
In its resolution 1992/50 on the fraudulent or unlawful enrichment of top State officials, the Commission on Human Rights pointed clearly to the responsibility of the North in connection with the commission of that crime in the countries of the South and thus raised the question, still unclear in international law, of the restitution to despoiled peoples, for reinvestment in local economic, social and cultural development, of the funds which their leaders have extorted from them, usually with the complicity of foreign banks. The existence of highly developed capital markets encourages certain offences such as insider offences. The same is true in the countries with economies in transition. The headlong privatization taking place is accompanied by similar phenomena.
Jose Arthur Rios wrote: "Corruption is the product of inverted ethics, in that the act of corrupting involves the idea of reciprocity, which is actually an element of equity and justice". In a modern society, this rule of reciprocity results in corruption when it involves transactions which subordinate the management of public resources to the interests of the private sector. In primitive societies, the custom of reciprocal gift-giving establishes a network of obligations between the groups. This network is functional and legitimate in such societies and in theory raises no question of corruption. Gift-giving can become an instrument enabling some individuals to impose their will on those who are unable to reciprocate. This latter group may be working for the private sphere at the expense of the public sphere or the general interest. In the context of this report, we must avoid lumping together minor forms of corruption (e.g. of public officials) and major forms which are sources of massive violations of human rights.
The advent of modern society has endowed money with three separate functions which often make it the catalyst for the phenomenon of corruption, since money has no bounds, can be transferred unobtrusively from one person to another and can be used for any transactions by virtue of its abstract nature. As noted earlier, corruption is universal. Nowadays, all States, whether developed or developing, suffer from the same phenomenon to varying degrees. Corruption is thus a functional phenomenon operating at all levels and in all spheres of activity. It has been rightly pointed out that corruption cannot thrive in a pluralistic and democratic society.
Data on corruption is naturally difficult to obtain since concealment is in the interest of all parties. Public sector corruption could not be effectively discussed prior to the mid-1980s, notably with regard to the developing countries, because of its political implications. The level of official corruption in some countries, notably in Africa, has driven foreign investors out of the market, and made it virtually impossible to conduct business. In 1992 surveys in Latin America indicated that people at all levels of society believed that their governments were corrupt and exhibited a greater indignation against corruption than for the past decades. Failure to respond to evidence of corruption had become a principal source of instability in some of the region's democracies; politicians were recognizing that attacking corruption was a means of gaining votes. The USA complained in 1993 that, with the exception of Singapore, official graft was commonplace in much of East Asia, especially China, Indonesia, Philippines and Thailand, and had become more exorbitant. As an indication, in 1993 it was estimated that a supply contract could involve extra-contractual commissions of up to 15% compared to 5% a decade before (examples include: 5% of US$200,000 for a senior official; of US$2 million for a top official; of US$20 million for a minister and key staff; of US$200 for a head of state). A 1993 survey indicated that although the problem existed in Malaysia, South Korea and Taiwan, it was not as common or as systematic.