Saturday, November 24, 2012

Tackling Corruption

Below I compiled my notes taken during a session with Travis Winslow, Director of Ethics and Corporate Compliance at Carnival Corporation, and Jermyn Brooks, Chair of Transparency International. As with all blog posts in this series, what I have written below should be considered paraphrases, not direct quotes.

The session notes are brief so I’ve included some extra resources based on my own research on the various forms of corruption and how it impacts human rights.

Side Note: Transparency International developed and, in 2009, updated Business Principles for Countering Bribery. This guide includes basic definitions and program development best practices for organizations attempting to identify and fight bribery and related forms of corruption within their operations.

How do you tackle corruption in your own organizations?

Travis Winslow: The corruption issue is a key factor reducing foreign investment

Jermyn Brooks: Countries should adopt legislation consistent with the OECD Anti-Bribery Convention. In the United States, foreign bribery cases outnumber those in other countries.

TW: The Foreign Corrupt Practices Act (FCPA) does not exclude facilitating payments, but there is not much difference between facilitating payments and bribes. Without more specific guidance, companies make assumptions and draw their own lines. No consistency. UK’s 2010 Bribery Act does prohibit facilitating payments.

JB: Often a policy is a publicly stated commitment but question is if organization complies with laws and guidance. This requires implementation and monitoring. Businesses would prefer one authoritative guideline, with industry-specific sub-guides (e.g., for maritime operations or working in conflict areas).

Side Note: The UN Global Compact Working Group devoted to the 10th Principle, the Anti-Corruption Principle, developed Reporting Guidance for Compact participants. This guide emphasizes the importance of transparency, spells out the business case for anti-corruption initiatives, and provides a matrix of basic and desired reporting elements. The guide also includes detailed best practices for implementation and monitoring of anti-corruption initiatives. Their Business Anti-Corruption Portal provides a variety of tools and resources developed in partnership with larger organizations experienced with fighting corruption in developing countries. The Portal was designed to benefit small and medium sized companies by sharing training programs, due diligence tools, and other resources.

TW: We seem to have reached the point where companies know and accept they should be proactive in these areas but don’t want to be first or act alone. Companies open themselves up to scrutiny by consumers and investors. Encouraging transparency means not going on attack as soon as transparent information is available, or nobody will follow.

Side Note: Carnival Corporation is a member of BSR’s Maritime Anti-Corruption Network, a group that shares best practices and creates awareness about maritime-industry challenges specifically related to bribes and other forms of corruption.


My takeaways from the talk:

  • Companies want consistent global rules and guidelines defining bribery, facilitating payments, and other forms of corruption
  • Some industries face specific challenges that need specialized guidance and competitors would (and do) benefit from information sharing and transparency
  • Companies are hesitant to be too transparent on these issues because of perceived potential backlash

This is another complex issue and difficult to tackle with any depth during an hour long session. As always, if you have any comments, questions, or corrections related to the above, please let me know.

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