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Can there be trust without transparency?

Posted by Tim Cummins, President of IACCM, Professor, Leeds University School of Law; Chair, International Commercial & Contract Management | Sep 25, 2018 10:39:00 AM

There is a growing movement for transparency in contracting. Organizations such as the Center for Global Development and the Open Government Partnership are at the forefront. IACCM is a contributor and strong supporter of this work since it is fundamental to our mission of ‘improving the quality and integrity of trading relationships’.

The focus at this point is on public sector contracting with the initial intent to reduce potential for corruption and dishonest dealing. More ambitiously, there is talk of creating greater visibility into value, though this would surely demand having insight to much more than just the contract.

Backroom deals and exclusionary practices

However, the real point is whether there can be public trust and confidence without an ability for scrutiny. An article in The Wall Street Journal (9/24/18) exposes precisely this issue. It highlights “dozens of contracts” where “Dominant hospital systems use an array of secret contract terms to protect their turf and block efforts to curb health-care costs.” This is wrong and, according to the article and my informal conversations within the industry, it goes a long way to confirming why health care costs in the United States are so much higher than elsewhere (President Trump, please take note).

A universal problem

This problem isn’t unique to the US, because at heart it comes down to the underlying morality of the health sector and attitudes towards justifiable levels of profit in an area of human need and suffering. In the UK just last week, Novartis was loud in its protests because it lost a challenge when the government approved use of a much cheaper alternative to one of its flagship products, representing health care savings of £500 million a year. This money will now be diverted to other health provisioning.

The need for debate

These examples highlight a pressing need for transparency and informed debate in all areas of major public interest. Healthcare is surely high among them,  as an area of universal social need, where the scale of expenditure means that opportunities and incentives for corruption and abuse are rife. These concerns apply whether the public health system is largely provided by Government or by the private sector. Opaque pricing and back room deals surely have no place in a field of such fundamental human interest.

i appreciate the need for the health sector to generate profits that fund research. I also recognize the pressing need to revamp the costly regulatory and distribution process through the use of new technology. Vested interests abound, yet health more than anything should surely be an area where there is no debate about the need for integrity. Even those who run the system are not immune to sickness and disease. Society as a whole should be united in tackling unprincipled motivations for commercial gain, ensuring that transparency provides a basis for honest dealings and trust.

Topics: contracting excellence, organization & people, contract management

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