Key elements of an anti-bribery_anti-corruption framework

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y Robin Singh, MSc-Law, MBA, CFE Key elements of an anti-bribery/anti-corruption framework »» To successfully develop and implement an anti-corruption framework, an organization must have an excellent tone at the top. »» An anti-corruption framework must have a robust, clear, and comprehensive definition section for any employee or vendor to refer to. »» Assess your organization’s culture with adequate risk assessments and take steps to mitigate problem areas. »» The degree of confidentiality and mechanism of reporting offered to employees will inform the level of trust those employees maintain. »» Investigation procedures and disciplinary actions that an employee might face are indicators of an organization’s tolerance and intolerance toward misconduct. Singh Anti-bribery statutes are enforced in many nations across the world. One of the most prominent statutes is enforced in the United Kingdom through the Bribery Act of 2010 and various nineteenth century and twentieth century laws. The United States of America has enforced the Foreign Corrupt Practices Act of 1977 (FCPA). Some other countries with strong anticorruption frameworks in place are Russia, Italy, Ireland, China, and Brazil. Although the Netherlands has not laid down a specific statute against anti-corruption, its Dutch Criminal Code (DCC) constitutes bribery by a civil servant as a criminal offense (Article 177, 177a, and 178 of Dutch Criminal Code). These articles were specifically introduced into the Dutch Criminal Code as a compliance measure of the OECD convention of 1997. Top Nine elements of anti-bribery framework The Bribery Act of 2010 in the United Kingdom came into force on July 1, 2011. The Act is a representation that strengthens the position of the United Kingdom on corruption and bribery and is a major milestone in the development of anti-bribery legislations at a global level. Here are the Top Nine elements of anti-bribery framework, according to the UK Bribery Act. 1. Procedures should be proportionate: Procedures that exist to prevent any act of bribery should be proportionate to the risk. Moreover, policies should be accessible, clear, practical, enforced, and effectively implemented. Compliance & Ethics Professional ® April 2016 +1 952 933 4977 or 888 277 4977 www.corporatecompliance.org 73
Compliance & Ethics Professional ® April 2016 2. Commitment of top management: Top management should be thoroughly committed to confrontation of bribery across the company. Management should work towards creating a culture where accepting or giving bribes must be discouraged. 3. Risk assessment: While assessing risks, both internal and external risks should be considered. Regular risk assessments should be performed and the results should be documented. 4. Due diligence: The anti-bribery approach has to be risk-based and proportionate. Persistent efforts should be given by all parties who are providing services for the business. 5. Communication and training: Procedures as well as policies should be understood and embedded. Training that is conducted should be in proportion to risks and customized according to specific needs. Unless you train, the framework/policy is ineffective and you can forget about getting compliance. Train and carry out refresher trainings to make it a success. 6. Internal audits: Internal audits should be conducted according to documented procedure to check the effectiveness of anti-bribery procedures. 7. Monitoring and review: Evaluation is essential to find out how effective the procedures for bribery prevention are in an organization and make changes wherever necessary. 8. Reporting: It is a question that is defined differently and offers a different level of confidentiality depending on the institution that is developing the anti-corruption framework, such as non-governmental or governmental institutions can offer. Depending on the type of reporting and the degree of confidentiality, an organization can proactively propose their assistance as intermediaries in addressing such offences. 9. Investigation & Discipline: The framework should define an organization’s zero tolerance towards such crimes and the level of discipline to which an organization is willing to go to set a lesson and ingrain a culture of integrity. Comparison between Chinese anti-corruption laws and FCPA Many people are under the impression that all nations where they carry out business transactions have anti-corruption laws similar to those in their home countries. However, such assumptions often lead to negative consequences, especially if you are not familiar with the legal system and cultural practices of a country where you are currently conducting your business. For example, if your company has business interests in the People’s Republic of China (PRC), you may have to revisit your compliance program to make sure that you are complying with China’s severe and singular anti-corruption regulations. We will now illustrate how the USA’s FCPA is different from China’s anti-corruption laws. One law versus a set of laws FCPA provides the central set of guidelines that are applicable for American companies that do business overseas and with international organizations that have their presence in the U.S. The FCPA is a single United States federal law, and its rules for conducting international business have simplified the processes that help in ensuring compliance. In contrast, China’s anti-corruption rules do not exist as a single law. They are spread across various rules and regulations that include the Anti-Unfair Competition Law, 1 Provisional Measures 74 www.corporatecompliance.org +1 952 933 4977 or 888 277 4977
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