1. Compliance Collective Action in China
Yuyang Liu
SII2 Integrity Partner Peer Learning Workshop
Plenary 4: Collective Action in East & South Asia
Basel, Switzerland, 27 Apr 2018

2. Contents
I. Academy Introduction
II. Collective Action
III. Challenges

3. Academy Introduction Research domain:
NATC specializes in the research on the global and China strategy of TNCs, corporate governance and culture with a focus on corporate social responsibility.
Business Model:
submits policy recommendations for the Ministry of Commerce and other government agencies.
offers consulting advice to Chinese and foreign TNCs.
Prof. Wang Zhile, Member of UN Global Compact's Working Group on the 10th Principle (2011) 3*

4. Contents
I. Academy Introduction
II. Collective Action
III. Challenges

5. Funding Period: 36 months/ Oct. 2014 to Sep.2017
Siemens Integrity Initiative 2nd Funding Round
Name: Strengthen Compliance Capacity Building of All Market Participants in China
Aim: strengthen compliance capacity of Chinese enterprises and promote collective action in China
Funding Period: 36 months/ Oct to Sep.2017
Funding Amount: USD: 1,493,932.85

6. Activity1: Research & Publication
Activities & Outcomes
Activity1: Research & Publication
Six steps of establishing compliance system
Compliance risks assessment through investigation
Developing risk-orientated compliance policies
Coordination of compliance related functions and strengthening compliance responsibilities
Enhancing compliance operating measures such as training, compliance performance evaluation, case reporting and investigation
Evaluation of the effectiveness of compliance system
Cultivate compliance culture through persistent effort
based on first-hand experience of enterprises
emphasizes corporate compliance practices
调查研究，
识别合规风险
风险导向，
健全合规制度
管理协调，
强化合规职责
保障运行，
完善合规机制
效果评审，
推进持续合规
持之以恒，
形成合规文化

7. Activity1: Research & Publication

8. Activity2:Policy Recommendation
Three reports:
Reinforcing Compliance Culture: A New Goal for the Reform of State Owned Enterprises
Enlightenment Gained from the Compliance Management Practice of American Companies
Chinese Enterprises are Faced with Great Compliance Risks: Lessons Learnt from the case of ZTE
Submitted to
State-owned Assets Supervision and Administration Commission of the State Council,
Ministry of Commerce,
Office of the Central Leading Group on Financial and Economic Affairs

9. Activity2:Policy Recommendation
March 30, 2016 SASAC launched the program-Establishing Compliance System in SOEs, and selected 5 pilot enterprises: China National Petroleum Corporation China Mobile Communications Corporation China Railway Group Dong Fang Electric Corporation China Merchants Group
Improve the draft of Guidance for all SOEs to establish compliance management system

10. Activity3: Compliance Club
Compliance Training
Sep ,2015,Beijing
Mar.23-25,2016,Beijing
Jun.15-17,2016,Shenzhen
Sep.21-23,2016,Beijing
Apr.19-21,2017,Shenzhen
Jun.14-16,2017,Beijing
Aug.14-16,2017, Beijing

11. Activity3: Compliance Club Compliance Training
BMW Brilliance
Dongfang Electric

12. Activity3: Compliance Club
Compliance Forums &Workshops
improve corporate governance and compliance implementation
dialogue between public and private sectors
push collective action

13. Activity3: Compliance Club
Seminars for target industries
Auto industry, with China Association of Automobile Manufacturers
Healthcare industry, with Advanced Medical Technology Association
petroleum and petrochemical industry, with China Petroleum and Chemical Industry Federation

14. Activity3: Compliance Club
expert team on corporate compliance

15. Outcomes
strengthening compliance has gradually developed into the collective action in China
On the 35th conference of the leading group for comprehensive deepening of reform on May 23rd, 2017, President Xi announced that “the construction of compliance system in overseas business operation should be strengthened”.
and "we will strengthen international counter-corruption cooperation so that the Belt and Road will be a road with high ethical standards.”
multiple Chinese departments like SASAC, and provincial departments like Beijing and Shenzhen authorities are enhancing compliance management of enterprises
many industrial associations and institutions jointly push the trend of compliance, such as China Petroleum and Chemical Industry Federation

16. Contents
I. Academy Introduction
II. Collective Action
III. Challenges

17. 1.promote collective action on a larger scale,
Challenges
1.promote collective action on a larger scale,
further enhance compliance capacity of Chinese enterprises
as China strengthens international cooperation and further opens up while pushing the policy of "One Belt and Road“, a large number of Chinese enterprises are gonging global, and compliance risks have become their core risk
Chinese enterprises still lack expertise to set up compliance plans and address their primary risks
to influence Chinses enterprises of different types, especially the medium and small sized enterprises and enterprises in less developed regions 3*

18. Platform building
With the support of multiple government departments, NATC has cooperated with China Enterprise Confederation and China Council for the Promotion of International Trade to establish China Enterprise Compliance Promotion Alliance.

19. CECPA Platform building
unite industrial associations and institutions to push collective action
dialog with central and provincial government to enhance lawmaking and enforcement
CECPA
issue practical guide for Chinese enterprises to establish compliance system
training and certification for compliance practitioners
platform for market participants to share knowledge and address compliance challenges

20. 2.Compliance implementation of Chinese enterprises
Challenges
2.Compliance implementation of Chinese enterprises
Positioning and responsibilities of compliance functions in corporate governance
compliance related functions in SOEs
internal control
internal audit
enterprise risk management
Discipline Inspection & Supervision
Legal Department 3*

21. Case study China Railway Group
Coordination of related function to jointly enhance corporate compliance
Three defenses of compliance:
-Business Sectors
-Law and Other Internal Control Departments
-Discipline Inspection & Audit Department

22. Thank You！