Anti-corruption guidelines: the challenge of multijurisdictional approaches

The multiplication of national guidelines published on the issue of anti-corruption compliance over the past few years has some Compliance Officers shaking their heads in perplexity.

The first nation to publish national guidelines on the issue of corruption prevention was Italy in 2001 with the Law Decree 231. And although the US Federal Sentencing Guidelines were first published in 1991 as a way to encourage companies to reinforce internal controls it was not until 2004 that the famous Seven Steps of Chapter 8 appeared which described what an effective ethics and compliance program entail. This was followed in 2011 with the publication in the United Kingdom of the six principles of the UK Bribery Act Guidance which introduced the issue of an affirmative defense. Subsequently, in 2013 Russia published its own guidelines followed by France, Spain and Brazil in 2015.

Some of these national guidelines are obligations whilst others are merely recommendations. Some include an element of extraterritoriality whilst others are strictly national.

Similarities and differences amongst guidelines: what is the Compliance Officer’s priority?

Companies have no shortage of suggestions and examples of what to implement in order to prevent corruption. This is useful, however, problems arise for Compliance Officers working for companies operating internationally as they soon discover that the guidelines are not identical. Nor are they contradictory; however, some have specific points not found in others. For example, the Italian authorities require companies to develop a kind of watchdog unit within the company while the Russians place great importance on identifying conflicts of interest and the French require the design and implementation of a sanctions policy.

This profusion of recommendations must not detract a Compliance Officer from his or her principle task which is to design and implement an effective corruption prevention program. On this point, the British authorities were prescient. The UK Bribery Act Guidance centers on the principle of “adequate procedures”. It is because the corruption prevention procedures will be appropriate to the company’s specific corruption risk and its organization that they will be effective. The more appropriate the procedures, the lower the risk of corruption.

This means that for Compliance Officers working with multinationals who operate on a global scale the priority should be determining the adequacy of the design and implementation of a corruption prevention policy given the company’s operations in order to ensure maximum efficiency. Then the Compliance Officer can consider the specific requirements of national guidelines. Ideally, these two considerations should be taken simultaneously however that is not always possible depending upon the specifics of business operations or the resources available for compliance. The priority is to ensure that no corrupt practices occur as opposed to preparing a legal defense!

The complementarity of official guidelines and voluntary best practices

The proliferation of national guidelines indicates a desire on the part of national governments to encourage corporate corruption prevention programs and to punish those who do not implement appropriate procedures. However, it should not be a company’s priority just to meet national expectations on legal compliance and I don’t believe that that is the case for the majority. I am convinced of this because, in spite of the myriad directives issuing from various national governments, companies continue to work collectively to identify and implement effective best practices in corruption prevention voluntarily. These actions include the work of the ICC Commission on Corporate Responsibility and Anti-corruption on gifts and invitations, a multi-company initiative on offsets contracts and another on tainted assets in mergers and acquisitions. I include in these efforts the work done by the companies certified by ETHIC Intelligence and the Certification Committee lawyers when they gather once a year for the Excellence in Compliance Day to discuss emerging best practices in corruption prevention and the strengthening of the ETHIC Intelligence Terms of Reference.

National guidelines on corruption prevention and voluntary best practices are complementary. The first set the legal framework while the second define the methods of implementation. In order to examine more thoroughly the complementarity of these two issues and to celebrate the tenth anniversary of its certification activity, ETHIC Intelligence is organizing a conference at the OECD Conference Centre on September 13 entitled “Standards & Guidelines: Recent Developments in Anti-Corruption Compliance.

On this occasion we will also discuss the imminent publication of the ISO 37001 standard on Anti-Bribery Management Systems and its implications for corporate compliance. I will dedicate my next blog to this new standard.

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