Integrity is a strategic asset for governments and businesses. When well designed and effectively implemented, public integrity systems protect democracies from corruption, strengthen trust in public institutions, and support the conditions for growth and fair competition. Countries that seize this integrity advantage are better positioned to attract investment, manage risks and respond credibly to citizens’ expectations.
To generate this integrity advantage, governments must remain mindful of the evolving threat which corruption poses. Corruption hurts economic growth by decreasing levels of foreign direct investment. The now outdated view that corruption “greases the wheels” of the economy by circumventing inefficient regulations has little empirical backing. Rather, the evidence shows that corruption stifles innovation and investment, adds cost and inefficiency, and diverts resources away from intended uses, particularly in countries with low-quality governance (U4, 2017[1]; Damijan, 2023[2]; United States Trade Representative, 2025[3]). Integrity pays off as companies prefer to invest in stable and predictable political and regulatory environments. An uneven playing field adds uncertainty and potential costs, stifles entrepreneurship and distorts competition. Businesses view corruption as a significant challenge, with 1 in 4 firms worldwide singling out corruption as “a major or very severe constraint” according to the World Bank Enterprise Surveys (The World Bank, n.d.[4]). In the European Union, more than three quarters think that over-close links between business and politics lead to corruption (77%) and around two-thirds that favouritism and corruption undermine business competition (65%) (European Union, 2025[5]).
On the expenditures side, weak integrity systems generate substantial fiscal losses. Countries lose a significant share of GDP to fraud, corruption and waste, with public, private and not-for-profit organisations estimated to lose 5% of revenue to occupational fraud each year globally (approximately USD 5 trillion in losses) and between 8-25% of global public investment may be lost to mismanagement of fraud in procurement operations (Association of Certified Fraud Examiners (ACFE), 2024[6]; Fazekas, Sberna and Vannucci, 2022[7]). This loss happens both at the stage of tax collection (countries at the same level of economic development but with lower levels of corruption are estimated by the IMF to collect around 4% more of their GDP in tax) and service provision. In several countries, fraud has become the most prevalent and fastest growing of all crime types in recent years. In addition, increasingly powerful and transnational organised crime networks are emerging, which use corruption as a tool to divert public resources away from their intended use by targeting public procurement, grants, licencing and planning processes. Technological developments, including artificial intelligence, are increasingly used by individuals and criminal organisations to commit fraud and increase the efficiency of their own operations at the public expense.
Corruption also distorts public policies, deepens inequalities and erodes public trust. According to the OECD Survey on Drivers of Trust in Public Institutions, the number of people with low or no trust in the national government now exceeds those who express trust. Balancing the interests of different groups in society for the public interest is among the most important tasks of parliaments and governments, and among the best levers for improving trust in national governments and legislative institutions, along with improved checks and balances within institutions and transparent, verifiable decision-making. However, fewer than one in three people find it likely that the government would refuse a corporation’s demand if it went against the public interest. Nearly half doubt that a high-level political official would refuse to grant a political favour in return for a well-paid private sector job (OECD, 2024[8]). These trends have corresponded with a decline in engagement with politics and a growing scepticism about governments’ ability to reliably address societal challenges.
In short, citizens and businesses want governments to uphold and prioritise integrity. Governments must table bold action and invest in risk-based, results-oriented integrity reforms that address the challenges raised by investors, consumers and voters, use new technologies for greater impact, and be able to showcase the benefits and work together across jurisdictions. However, the accumulation of burdensome and inefficient governance processes, as well as their often rigid implementation, has taken a toll on government capacity and efficiency to deliver reforms. Overly rules-based and process-heavy approaches to public integrity are outdated, introducing too much check and not enough balance into the business of government. Instead, as in other policy areas, governments must continue to adapt their integrity frameworks to ensure they are efficient, targeted and adding value for businesses and citizens.
For businesses, while compliance remains a legal and ethical obligation, compliance functions must increasingly demonstrate how their activity contributes to business objectives, beyond avoiding sanctions or reputational damage. New models are enabling companies to assess the “return on compliance”, and effective and efficient compliance can explain 15–18% of the variance in business performance (OECD, 2025[9]). Companies should pursue this shift to viewing integrity as a strategic capability, embedded in decision making and adaptable to business change, while also reinforcing the importance of a strong tone from the top to legitimise and sustain compliance efforts.
In taking this approach, governments and businesses can benefit from the ‘integrity advantage’, where integrity frameworks become a key enabler of prosperous economies and dignified societies in which people feel connected to their representatives.