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{ stRategic ManageMent }

the elusiVe Anti-BriBery CompliAnCe

internAl Controls: pArt 3

By Isabelle Pierre

this four-part series explores how in-house counsel can ment of the risk of corruption in various

design and implement effective anti-bribery controls without jurisdictions. Organizations can use the
index to rank the countries they do busi-
signifcantly expanding resources. this third part focuses on ness with or have dealings in by the cor-
the design of an anti-bribery internal controls system. ruption risk they pose. The output of this
self-assessment exercise should enable
counsel to identify the preventative con-
here are two types of internal anti- terviewing employees from various levels trols required to mitigate their organiza-
bribery controls: preventative and across the organization, at management, tion’s bribery risks.
tdetective. Preventative controls, as middle management and working levels,
the name suggests, prevent violations of to ensure that not only routine transac- 2. identifcation of required
anti-bribery legislation from occurring, tions and activities are captured but also preventative Controls
while detective controls detect violations activities that are outside of existing pro- As a frst step, based on the results of the
of company policy or the law and allow cesses and handled on an exception basis. self-assessment, the activities or behav-
counsel to assess on a routine basis the The completed assessment should iours that should be prohibited, should
effcacy of the preventative controls, and provide counsel a good understanding be subject to a vetting process or do not
correct and improve them as necessary, of how company assets and resources are require any form of control should be
thus allowing the compliance program to accessed. The questionnaire should be re- identifed.
evolve with the business. vised and re-administered annually to en- Prohibitions should be recorded in the
The design of a good compliance pro- sure the program adequately covers new company policies, and training should
gram starts with a self-assessment of the activities that the organization may have be provided to ensure employees are fa-
risk associated with an organization’s ac- undertaken. Where possible, the ques- miliar with them and they are enforced.
tivities, followed by the design of required tionnaire should be administered to dif- Common prohibitions include payment
preventative controls. ferent employees each time to get a variety of bribes or other facilitation payments,
of perspectives on the work performed by payments to commercial intermediaries
1. self-Assessment the organization to identify if anything in off-shore accounts, payments for work
A self-assessment allows counsel to draw was missed during previous years’ self- not performed, creation or use of slush
a comprehensive inventory of all of the assessments. funds, alteration of books and records,
company’s activities that may pose some To help prioritize the design and imple- concealing activities, and circumventing
risk under anti-bribery legislation. mentation effort, as well as help with the the application of policies.
Good self-assessment questionnaires design of the preventative controls, activi- Vetting is an individual risk assessment
are available online from a variety of for- ties identifed during the self-assessment of specifc activities or transactions. It
proft and not-for-proft organizations. exercise should be ranked by the level of can be as simple as a standard automated
Alternatively, a questionnaire can be cre- risk they pose. Most anti-bribery compli- due diligence on an entity or as resource
ated using lists of corruption red fags, ance systems feature a two-tier (high risk intensive as a legal opinion from outside
also found online, and a list of possible and low risk) or a three-part (high, me- counsel specialized in anti-bribery com-
activities involving interactions with gov- dium and low) classifcation system. pliance on very complex transactions. It
ernment offcials by or on behalf of the Activities that pose a risk under anti- can include a tailored assessment of risks
organization. Ideally, the questionnaire bribery legislation often involve dealing of corruption, a competitive procure-
should be answered in collaboration with with or in countries where corruption is ment process to purchase high-risk goods
the business’s employees to help reduce more prevalent. Transparency Interna- or services, a price check to ensure that
any blind spots the legal department may tional offers its online Corruption Percep- prices are not infated, an assessment of
have. Consideration should be given to in- tions Index for free to support the assess- a contractor’s ability to perform work,

44 CCCA MAgAzINE | FALL 2017 AutOMNE