Every company seeks methods to minimize the risk of internal misconduct. If your company does international business, you will especially want to minimize the risk of fraud and corruption—both within your company and with third parties. Just as you have financial and operational policies and procedures to assure compliance with U.S. government requirements, you should have an anti-corruption program or an integrity compliance program. We assist companies in preparing anti-corruption compliance programs.
These programs are tailored to the needs of each particular company, depending on the size of the company, the countries where it does business, the industry in which it operates and other factors affecting the nature of the risk. In the United States, most companies doing business internationally are concerned about compliance with the Foreign Corrupt Practices Act. But there are other regimes that guide the design of these programs, such as the World Bank Integrity Compliance Guidelines, the U.K’s Anti-Bribery Act, the Anti-Bribery Recommendations of the Organisation for Economic Co-operation and Development and several others.
Developing an anti-corruption compliance program requires several stages. In the first stage, we ascertain the business risks facing the company. During this stage, we analyze the key business issues pertinent to corruption risk for the company: business contracts; business partners and third parties; dealing with government officials and state-owned enterprises; conflicts of interest; facilitating payments; lobbyists; and country risk.
In the next stage, we will assess the corruption risks that may affect the business. For example, the following may present red flags: unusual payment patterns or financial arrangements; unusually high commissions; lack of transparency in expenses and accounting records; lack of qualifications of local joint venture partner.
The third stage is preparing an anti-corruption or integrity compliance program (ICP). The program we develop will articulate the company policies for various aspects of the company’s business such as doing business with third parties; travel and entertainment; gifts; facilitation payments; internal controls.
The final stage includes training and communication of the program to the company’s employees and the third parties with which the company works. This stage generally includes training sessions and may include internal or external monitoring.
Having an effective anti-corruption program minimizes the risk of corruption and fraud. A company that is charged with misconduct can use the program as a mitigating factor in any sanction imposed. If a company has already been debarred, then the sanctioning authority such as the World Bank may require implementation of a ICP. We represent companies that have been charged with misconduct and more details can be found in our government contracting practice.