1. Corporations and Corruption: What Role for Companies

2. Emerging Framework  Corporate Responsibility Norms  Corporate Governance Principles  Treaty-based Rules

3. Common Elements  Obligation to criminalise bribery and other corrupt practices  Natural and Legal persons  Broad jurisdictional reach  Criminal, civil and administrative sanctions  Monitoring  Public Scrutiny

4. OECD Convention  Criminalises bribery of foreign public officials  Applies to bribery in international business transactions (excludes facilitation, “grease” payments  Territorial/nationality jurisdiction  Disallows economic and political considerations  Facilitates extradition and mutual legal assistance  Prohibits tax deductions for bribes

5. Monitoring Mechanism  All Parties must undergo monitoring  Results are submitted to international body of Parties  Parties must implement recommendations  Evaluations are made public

6. Monitoring Phases  Phase 1 – assesses whether countries have correctly transposed the Convention in national law  Phase 2 – evaluates whether countries are effectively applying their national laws in practices

7. Where do we stand?

8. Impact on Company Behaviour  “…awareness of the Convention has hardly improved in the three years: only 7% of all respondents expressed familiarity with the Convention compared to 6% in 1999”.

9. TI 2003 Global Corruption Report “In a notable development, scores were found to have improved slightly since the 1999 survey: companies are marginally less likely to bribe now than three years ago”

10. Increase in Risk Awareness  Low public tolerance  Internal company controls to increase transparency, prevent bribery, improve corporate governance  Greater awareness of national anti-bribery laws and non-deductibility of bribes  Loss of reputation and damage to firm

11. Creating a corporate culture of compliance  Corporate code of ethics  Facilitating reporting of illegal activities, “whistle-blowing”  Linking compliance and governance: CEO, Audit Committee, Board CEO, Audit Committee, Board

12. Measuring the level of risk awareness  Content of company codes (general or specific references to bribery, corruption, legal rules)  Compliance processes  Training of company officers  Application to Subsidiaries

13. A “Disabling Environment” for Corruption  Legislative/regulatory framework (may need adjustments)  Synergies between treaty-based obligations and governance norms  Recognizing “value-added” of good governance and corporate responsibility  Ensure enforcement

14. The Great Governance Challenge Making a positive contribution to economic development and the alleviation of poverty while serving its clients and making money for its owners. Making a positive contribution to economic development and the alleviation of poverty while serving its clients and making money for its owners.

15. Thank you Thank you