In the wake of Wal-Mart’s alleged Mexican bribery scandal, many voices in the business sector are no doubt asking what companies can do to improve their anti-corruption programmes and avoid the increasingly long arm of US law-enforcers who are vigorously pursuing violations of the FCPA.
This is just the latest corporate corruption scandal, and they continue to surface almost on a daily basis. Ultimately, these scandals undermine the credibility of company commitments to act as good corporate citizens.
There is no denying that we are making some strides in setting up a more effective legal framework aimed at combating corruption. And responsible enterprises are getting better at developing comprehensive policies and procedures to address the risk of corruption.
But beyond this, companies also have a responsibility to be transparent about their commitments to corporate responsibility, in particular their efforts aimed at curbing corruption. To help companies achieve this, TI worked with the UN Global Compact, the world’s largest corporate responsibility initiative to develop comprehensive guidance materials to produce more thorough and consistent reporting on the 10th Principle against corruption by the Global Compact 6,000 signatory companies. TI is also working to assess the transparency of top companies. TI will soon be publishing a follow-up to TI’s 2010 Transparency in Reporting on Anti-Corruption – A Report of Corporate Practices (TRAC) which assessed the extent to which leading companies reported the strategies, policies and management systems they had in place for fighting bribery and corruption.
Increasingly, stakeholders are expecting that enterprises should be open and transparent about how they manage a range of non-financial issues, including bribery and corruption. The International Integrated Reporting Council is calling for “integrated thinking” about both financial and non-financial reporting Framework for Integrating Reporting, because a transparent company should be open and transparent in both spheres.
But company reports about anti-corruption need to be credible. This is why TI has developed a “Framework for Voluntary Independent Assurance of Corporate Anti-Bribery Programmes”. The TI Framework, which will be published this summer, sets out the steps enterprises should take to prepare for independent assurance and, most importantly, proposes criteria for the evaluation by assurance providers of an enterprise’s anti-bribery programme. The TI Framework was developed with the support of the World Economic Forum Partnering Against Corruption Initiative and in consultation with representatives of leading accounting firms. The ultimate aim of the initiative is to encourage business to consider public reporting and independent third-party assurance of anti-bribery programmes as a means of substantiating company claims about their efforts to counter corruption.
In a climate of increased enforcement of foreign bribery laws, TI believes that these tools and initiatives can help companies address the risk of bribery and corruption more transparently and effectively.