OECD’s France Chain and Daisy Pelham look at the critical role corporate compliance plays in the fight against bribery and corruption in the run-up to the launch of a new OECD Study on Corporate Anti-Corruption Compliance Drivers, Mechanisms, and Ideas for Change.
The COVID-19 (coronavirus) pandemic has provoked one of the biggest global health and financial crises in history. It has rapidly permeated every aspect of our lives, unsettling our democracies, our economies and our societies. This has sparked new and heightened risks of corruption around the world. With companies under great financial pressure to recover, anti-corruption compliance departments and systems are being put to the test. Against this backdrop, businesses must ensure they operate safely and compliantly.
Robust compliance procedures are essential to protect businesses from changing internal and external risks. Since the OECD Anti-Bribery Convention came into force in 1999, managing the risk of bribery has been identified as one of the most challenging areas of compliance. Major foreign bribery scandals have resulted in record-breaking fines, which has seen the field of compliance grow exponentially over the past ten years.
Companies can and should play a key role in preventing, detecting, and responding to corruption. The OECD’s 2017 report on the Detection of Foreign Bribery showed that 23% of foreign bribery cases that resulted in definitive sanctions over the last 20 years were detected via self-reporting by companies. In addition, the OECD Foreign Bribery Report revealed that over 40% of bribery cases involved management-level employees either paying or authorising bribes, while 12% involved CEOs.
The OECD, through its Working Group on Bribery which brings together the 44 Parties to the OECD Anti-Bribery Convention, promotes the development and implementation of anti-bribery compliance programmes through its peer monitoring and government-endorsed guidance for businesses, such as the 2010 OECD Good Practice Guidance on Internal Controls, Ethics and Compliance. The 2013 OECD/UNODC/World Bank Anti-Corruption Ethics and Compliance Handbook for Business, jointly developed with business organisations, NGOs and intergovernmental bodies, is a further source of guidance.
However, whether it be lack of resources, buy-in, or pressure to make profit, implementing an effective compliance programme is no easy task. On top of this, the confusing multiplication of compliance models, the fast-evolving notion of compliance and the need for a multi-stakeholder approach show us that achieving compliance is no mean feat. The need to enhance and incentivise compliance is a priority issue being addressed in the current review of the OECD’s 2009 Anti-Bribery Recommendation, which complements and strengthens the OECD’s Anti-Bribery Convention.
To help shed light on some of these challenges and show us the way forward, a forthcoming OECD study on Corporate Anti-Corruption Compliance Drivers, Mechanisms and Ideas for Change explores what motivates companies to adopt anti-corruption compliance measures, and looks at how companies (including SMEs) could further be incentivised to do so. It also underlines some of the main challenges faced by companies looking to implement anti-corruption programmes, and proposes potential solutions, including ways for governments, international organisations, and civil society to better support and accompany companies in their anti-corruption efforts. The results revealed in the study are based on desk research as well as insights from over 100 company representatives.
Register now to join us online for the launch of the new study and a discussion on “What really motivates anti-corruption compliance?” on 23 September 2020 from 15.00-16.30 Paris time.
This blog updates an article first posted on the Global Anti-corruption Blog