Taiwan People’s Party (TPP) Chairman Ko Wen-je (柯文哲) on Sept. 13 announced that the party had launched an independent whistle-blower platform to report corruption in their ranks. Just one day later, the accounting firm that was supposed to operate the system terminated its agreement with the TPP, in a reversal that has seriously damaged the image of the presidential hopeful and his party.
A TPP official said that Deloitte Taiwan and the party approved a contract on July 5, and after the platform had been tested, the TPP remitted a payment on Sept. 1.
Why then have former Taipei mayor Ko and the TPP been pushed into disarray by such a simple commercial transaction? The reason lies in the TPP’s deviation from the spirit of the agreement.
On Sept. 15, former Taipei deputy mayor Vivian Huang (黃珊珊), who is chief of staff of Ko’s presidential election campaign, wrote on Facebook that the external third-party reporting platform would be able to receive reports 24 hours a day, 365 days a year.
Huang added that it would conduct a preliminary screening investigation based on the evidence provided by the informant, then classify the report based on the degree, risk and urgency of the allegations, and immediately report the results back to the informant.
She said that informants would be protected, and the TPP would apply anti-corruption measures when party officials are accused of involvement in illegal activities, corruption, violence or sexual harassment. The party would issue warnings and deal with the cases within a specified time frame.
The procedures treat the “third-party reporting platform” as an external verification department, to the extent that it would even shoulder some of the TPP’s internal management, essentially outsourcing tasks that would normally be the party’s own responsibility.
Before an organization pursues third-party certification, its management systems — such as quality control, data security or greenhouse gas inventory — must be based on existing standards such as those of the International Organization for Standardization. The organization must also establish an internal audit system to ensure implementation of the standards. If some duties are outsourced, the internal control measures would also be clearly stated.
The TPP falls far short of meeting those requirements. Radio host and pundit Huang Yang-ming (黃揚明), also known as Pokii Huang, said that after searching through the TPP’s Web site, he could not find anything like an integrity and transparency pledge, while the party’s charter does not mention a third-party reporting platform.
An accounting firm’s core business consists of tax and financial verification, management consulting and related services. Would services such as preliminary screening, investigation and follow-up processing of evidence dealing with corruption, violence and sexual harassment be within an accounting firm’s area of expertise? Its lack of expertise would limit the scope of its services.
When the scope of a contract is clearly one thing, but the client publicly says that it might be something else, and considering the politically sensitive nature of this whole arrangement, the accounting firm would naturally want to go into risk-management mode.
Communications that have come to light showed that Deloitte Taiwan did not want to hold a signing ceremony and news conference, and wanted a news release on the deal to not use the company’s name and instead only say “consultants and experts from a global network firm.” As Deloitte Taiwan assessed the situation and found that the risk could no longer be managed, it unsurprisingly terminated the contract.
Clarifying the agreement, Deloitte Taiwan said that it would not have provided any interpretation, investigation, processing or response services for information obtained through the reporting platform. It would have only forwarded cases reported through the system to the TPP, which would carry out any subsequent investigations itself with no involvement by Deloitte Taiwan. It also asked the public not to overinterpret the agreement or make nonexistent connections.
The TPP’s integrity has by this point reached a state of crisis. The party thought it could get out of this pickle through political manipulation, such as shouting about “green terror.” That forced Deloitte Taiwan to say that the agreement was terminated because the scope of the service exceeded what was originally intended, and that no political pressure was applied.
The TPP’s response to this issue has pushed what was already a leaning tower almost to the point of collapse. Its response might gain sympathy from the party’s existing supporters, but it has drawn some big question marks in the minds of rational voters. The third-party mechanism that Ko and the TPP had in mind has been shattered. The question now is does this party and its chairman have any chance of preventing corruption and eliminating abuses?
Wu Hai-ruei is a manager.
Translated by Julian Clegg
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