The number of companies that have signed a memorandum of understanding (MoU) with the Anti-Corruption Unit more than doubled after a signing ceremony yesterday, where it was also revealed that talks were under way to create an association of ACU signatories.
A total of 17 companies have now signed on with the ACU, up from eight. The agreement stipulates that the firm must operate corruption-free and report corrupt officials to the ACU.
The nine companies that signed on yesterday are all residents at the Phnom Penh Special Economic Zone, ranging from American diamond polishing firm Laurelton Diamonds to Japanese wax casting firm Nikko-Kinzoku.
As many of PPSEZ’s companies import parts to Cambodia and assemble them for export, corruption at the Customs Department has caused increased logistics costs, PPSEZ representatives said.
Referencing the issue, ACU chairman Om Yentieng said one of the major challenges for most foreign companies in Cambodia was “related to the import and export process”.
Yentieng added there were also plans to create a “club” for the increasing number of companies that have signed an MoU with the ACU.
Coca-Cola’s Cambodian branch, the first company to sign an MoU with the ACU in December 2013, said an association would help bring more companies into the fold.
“The idea is for Coca-Cola to have leverage to bring in new companies. Together we could be stronger,” said Paul Popelier, general manager of Cambodia Beverage Company Ltd.
On the process of the association itself, Phnom Penh Special Economic Zone chief executive Hiroshi Uematsu said yesterday it was “evolving, but it takes a bit of time”.
Some companies were still hesitant to sign up, Uematsu said, as they already had their own codes of conduct in place.
The ACU has added a raft of companies in recent months. For most of 2014 Coca Cola and Prudential were the only two to sign on, but in December five more were added.
Preap Kol, executive director of Transparency International in Cambodia, said the ACU’s move to reach out to the private sector was a good step towards creating a cleaner business environment in Cambodia.
“Having companies coming together to combat corruption – the single greatest deterrent for investors to do business in Cambodia – is the right thing to do”, he said.
Kol added, however, that merely signing an MoU was not enough.
“It is important that some due diligence and transparency mechanisms are established beyond the signing of the MoUs for the process to achieve its full potential.”