Making anti-corruption training widely accessible and scalable in this day and age often means taking it online. Most multinational companies have done exactly that to extend the reach of their training to employees and subsidiaries globally. Yet, few training resources exist for local companies in these countries who aspire to join global value chains. To help fill that gap, CIPE launched an interactive, online anti-corruption training course based on its Anti-Corruption Compliance guide for mid-sized companies in emerging markets. The training course is designed to teach executives and anti-corruption compliance and ethics officers how to identify, assess, and mitigate corruption risks in their companies. The course involves approximately 40 minutes of instruction and contains four interactive modules that test knowledge and understanding. While the course itself is free, upon conclusion users have the option to purchase a certificate of completion for a small fee.
Photo Credit: Inside Reg
Private sector anti-corruption compliance is predominantly associated with corporate corruption prosecutions, sanctioning, and debarment, with some positive examples of voluntary integrity building, as in the case of Thailand. Companies, regardless of jurisdiction, are focused on compliance and the required due diligence under the United States (U.S.) Foreign Corrupt Practices Act (FCPA) and/ or the United Kingdom’s UK Bribery Act, especially those seeking access to projects funded by the World Bank and similar development agencies. For companies caught in corrupt practices, anti-corruption compliance programs (or lack thereof) have become a crucial factor for successful conclusion of criminal or debarment proceedings.
Private sector entities in emerging markets that wish to do business with multi-national corporations subject to U.S. or UK rules also have a vested interest in this topic as corruption risk management and due diligence is increasingly becoming a notable condition of contracting and procurement proceedings. However, globally anti-corruption compliance has yet to become a mandatory element of doing business, but this may be about to change. Read More...
Photo Credit: Lattitude Canada, Wikimedia Commons
This post is based on a blog originally published on Corporate Compliance & Ethics Africa
It is a basic economic principle that a market exists because there is the concurrence of demand and supply or someone willing to buy and someone willing to sell goods or services. Similarly as it relates to bribing public officials for business advantage or other more egregious purposes, you must have someone willing to give the bribe and the public official willing to take a bribe.
Economists and private sector players propose that in West Africa, the demand side of corruption (public sector) has cultivated and nurtured a system where the private sector is coerced to partake in corruption in order to be successful. The result is an established system involving a series of illegal operations accompanying the actual demand and receiving of bribes (“kickbacks”, “favors”), creating an atmosphere within the private sector that undermines integrity. Read More...
Photo Credit: Wikimedia Commons (https://commons.wikimedia.org/wiki/File:KPK_Logo.svg)
For anyone with even a passing interest in anti-corruption issues, the headquarters of Indonesia’s Corruption Eradication Commission (KPK) is a sight to behold. Entering the lobby, visitors see a floor-to-ceiling glass wall, and just behind it sit journalists with a clear line of sight to view recently arrested government officials as they enter the KPK building for processing. Outside, three to four satellite TV news trucks are often parked, underscoring the symbiotic relationship between Indonesia’s free press and what is arguably the world’s most powerful anti-corruption agency.
Given the KPK’s authority in Indonesian society and its recent commitment to engage the private sector, Jakarta is an obvious destination for the Center for International Private Enterprise (CIPE) to test a new anti-corruption concept. For the integrated compliance pilot project to work, CIPE needs a country with a strong, independent body like the KPK, along with a dynamic economy, robust labor and environmental NGOs, reliance on labor-intensive agricultural exports, and a significant connection to global value chains. Read More...
Photo Credit: Peter Linke (via Flickr)
There is an ongoing debate regarding ‘pay by results’ in the international aid community. The pay by results (PbR) model is one in which aid recipient governments only receive donor funds upon achieving an agreed upon outcome – number of schools built, children inoculated, etc. For example, if the goal is to build sustainable road infrastructure, then the donor funds will only be released upon completion of the project, following an independent audit that the road meets all necessary standards. The idea is that this would shift incentives away from corruption – a government official is less likely to select the cheapest contractor offering a kick back if a poorly constructed road will not lead to payment by the donor aid agency.
Photo Credit: International Organization of Standardization (via Veracity Asset Management Group)
Back in October, the International Organization of Standardization (ISO) released the long awaited ISO 37001, a new international standard designed to help organizations prevent, detect and address bribery. As a potential game changer in international anti-bribery standards, the ISO 37001 can be used by any organization, large or small, public or private, to implement an anti-bribery management system designed to fight bribery and promote an ethical business culture. Unlike the previous ISO 19600, which was drafted as a set of guidelines that organizations should incorporate into their compliance programs, the ISO 37001 is drafted as a set of requirements that organizations must implement if they want to be certified.
The standard requires organizations to adopt an anti-bribery policy, select someone to oversee compliance with that policy, implement financial controls, and adopt reporting and investigation procedures. Since the ISO 37001 sets forth specific requirements for companies to meet, it is certifiable by third parties and companies that receive an ISO 37001 certification might potentially have an advantage against competitors that do not have the qualification. Read More...
Photo Credit: Wikipedia (https://en.wikipedia.org/wiki/Hanjin)
What are the primary economic concerns for the next South Korean administration?
According to a poll conducted by Han-kook Research on April 17, “Job Creation” (34.1%) ranked as one of the top priorities for the next administration. “Resolving polarization” (20.6%), “small and medium-sized enterprise (SME) empowerment” (20.4%) and “chaebol reform” (12%) were the next biggest priorities. However, considering the current Korean economic structure, there is no doubt that every economic concern mentioned above is chaebol (South Korean business conglomerate) related. According to statistics in 2015, the combined revenues of the five largest chaebols accounted for 58% of South Korea’s GDP. This figure already seems problematic, but in addition to this fact, it was further revealed by the political corruption case involving the former president that crony capitalism has confused the South Korean market and inhibited the growth of SMEs for a long period of time. Read More...
Photo Credit: VC Voices (http://vcvoices.org/2016/04/millennials/)
A recent Wall Street Journal blog article highlighted concerns about the “me-first” millennial generation pouring into the workplace in the near future. According to the article, millennials seem to care less about institutes and authority and as a result there is a fear that they would be more likely to sacrifice compliance for their own professional needs and self-interests. This prospect might frighten those who are in charge of corporate compliance and therefore incentives must be developed to encourage millennials that engaging in compliance is in fact the best course of action to advance their own self-interests.
We need to remember that corruption is not solely about morale. As Abdul Alkebsi, Deputy Director of Programs at the Center for International Private Enterprise (CIPE)asserts, “corruption is about incentive, not about morale. Everyone knows about morale, but what matters is their incentive for compliance”. If we think this argument makes sense, we need to know how perceptions toward incentives have changed from one generation to another. Read More...
Photo Credit: DFID (via Flickr)
Although the international development community aspires to noble ends, the firms and organizations therein are not free from the same compliance challenges that face corporations with more naked profit motives. Adam Smith International (ASI), the largest international development contractor for the United Kingdom’s Department for International Development (DfID), can attest to that point. In February 2017, ASI suffered a major blow when DfID froze all future contracts with ASI after uncovering unethical behavior on the part of ASI. These firm-specific compliance issues, however, serve as the entrée to a broader conversation about the roles of ethics, compliance, and the public in the arena of international development.
ASI earned their DfID sanction by hiring an ex-DfID employee who then used their access to proprietary DfID documents to help ASI gain inside information into how to win big DfID contracts. ASI also sought to influence the results of parliamentary hearings by making up glowing letters of support, supposedly from its beneficiaries. Read More...
Photo Credit: Robert (via Flickr)
In January 2017, Rolls-Royce, one of the world’s largest luxury-car and aircraft engine manufacturers, agreed to pay $800 million in a global settlement with the United Kingdom’s Serious Fraud Office (SFO), the U.S. Department of Justice (DOJ), and Brazilian prosecutors. Rolls-Royce acknowledged that in the course of three decades it hired intermediaries who paid bribes in return for lucrative contracts in at least seven countries, including Indonesia, China, India, Russia, and Nigeria. The key role in this investigation belongs to the SFO. Rolls-Royce is the largest ever case carried out by the British anti-corruption agency. Over five years, 70 investigators examined more than 30 million documents related to the case and conducted about 200 interviews with Rolls-Royce employees. To a great extent, this case was a survival test for the SFO, which was under systematic abolition threats since 2011. The deferred prosecution agreement (DPA) with Rolls-Royce in the amount of £497.2 million placed the British agency among anti-corruption’s big-league players. Read More...