Tag Archives: compliance

Guest Announcement: OECD Report and Webinar on Corporate Anticorruption Compliance

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France Chain, Senior Legal Analyst at the OECD’s Anti-Corruption Division, provides the following announcement regarding next week’s OECD webinar on “What really motivates anti-corruption compliance?”, an event which coincides with the launch of the new OECD Study on Corporate Anti-Corruption Compliance Drivers, Mechanisms and Ideas for Change.

Since the OECD Anti-Bribery Convention came into force in 1999, managing the risk of bribery has been identified as one of the most challenging areas of compliance for multinational businesses. Major foreign bribery scandals have resulted in record-breaking fines, which has seen the field of compliance grow exponentially over the past ten years. The OECD Foreign Bribery Report revealed that over 40% of foreign bribery cases involved management-level employees either paying or authorizing bribes, with CEOs involved in 12% of cases. At the same time, companies have shown that they can play a key role in detecting and responding to corruption. The OECD’s 2017 report on the Detection of Foreign Bribery showed that 23% of foreign bribery cases that resulted in definitive sanctions over the last 20 years were detected via self-reporting by companies.

However, implementing an effective compliance program is no easy task, and the COVID-19 pandemic has further heightened the challenges. With companies under great financial pressure to recover, anticorruption compliance departments and systems are being put to the test as never before.

To help shed light on some of these challenges and show us the way forward, a forthcoming OECD study on Corporate Anti-Corruption Compliance Drivers, Mechanisms and Ideas for Change explores what motivates companies to adopt anticorruption compliance measures, and looks at how companies (including small and medium-sized enterprises) could further be incentivized to do so. The study also underlines some of the main challenges faced by companies looking to implement anticorruption programs and proposes potential solutions, including ways for governments, international organizations, and civil society to better support companies in their anticorruption efforts.

The official launch of this study will take place on September 23 (one week from tomorrow), with a webinar panel discussion on What really motivates anti-corruption compliance?” to take place on September 23 from 15:00 to 16:30 Central European Time (9:00 am to 10:30 am U.S. East Coast time). You can register for the webinar here. The panel will bring together:

  • Axel Threlfall, Editor-at-large, Thomson Reuters (moderator)
  • Anna Hallberg, Minister of Foreign Trade and Nordic Affairs of Sweden (opening remarks)
  • Jeffrey Schlagenhauf, OECD Deputy Secretary-General (opening remarks)
  • France Chain, Senior Legal Analyst, OECD Anti-Corruption Division (presentation of key findings from the Study)
  • Alma Balcázar, Co-founder and Principal of GR Compliance SAS and Member of the International Council of Transparency International
  • Andrew Gentin, Assistant Chief, Fraud Section, Criminal Division, United States Department of Justice
  • Corinne Lagache, Chair, Business at OECDAnti-Corruption Committee, and Senior Vice President, Group Compliance Officer, Safran
  • Caroline Lindgren, Head of Legal and Local Compliance Officer of Sweco Sverige AB

Those attending the webinar will be able to submit questions through the chat during the live discussion on Zoom. The session will be recorded and subsequently posted on the OECD Anti-corruption and Integrity website.

Incorporating Anticorruption Measures in the African Continental Free Trade Agreement (AfCFTA)

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On April 2, 2019, The Gambia became the 22nd country to ratify the African Continental Free Trade Agreement (AfCFTA), which was the minimum threshold to approve the deal among the 55-member states of the African Union (AU). The AfCFTA aims to provide a single continental market for goods and services, as well as a customs union with free movement of capital and business travelers. Although the agreement will enter into force one week from tomorrow (on May 30, 2019), the negotiations for the Protocols and other important matters such as tariff schedules, rules of origin, and sector commitments are still being negotiated. However, once the treaty is fully in force, it is expected to cover a market of 1.2 billion people and combined gross domestic product of $2.5 trillion, which would make it the world’s largest free trade area since the creation of the World Trade Organization. This could be a game-changer for Africa. Indeed, the U.N. Economic Commission on Africa predicts that the AfCFTA could increase intra-African trade by as much as 52.3%, and that this percentage will double when tariff barriers are eliminated. The AfCFTA promises to provide substantial opportunities for industrialization, diversification, and high-skilled employment. And the AU’s larger goal is to utilize the AfCFTA to create a single common African market.

Yet there are a number of challenges that could thwart the effectiveness of this new treaty in promoting free trade and economic development. Corruption is one of those challenges. International indexes indicate that Sub-Saharan Africa is perceived as the most corrupt region in the world, with North Africa not much better. The current version of the treaty, however, does not address corruption directly. It should. Continue reading →

(Why) Is the Walmart Case Taking So Long?

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So this might not be the most important question in the world, but I’ve been wondering why the U.S. Government’s investigation into Walmart’s alleged violations of the Foreign Corrupt Practices Act (or, more accurately, FCPA violations committed by Wal-Mart’s Mexican subsidiary, Walmex) has yet to produce a final settlement.

A quick and somewhat simplified recap (for those among our readers who don’t obsessively follow every FCPA case in the pipeline): In April 2012, two New York Times reporters broke a blockbuster story about how Wal-Mex had been systematically paying bribes to scores of Mexican officials to get permits for new stores (often circumventing local environmental protection and historical preservation regulations in the process), and—perhaps even more damningly—about how Walmart’s senior leadership, upon learning of the bribery allegations from an internal whistleblower and preliminary internal investigation, had decided to cover up the problem and reject its own compliance department’s calls for a thorough investigation. (Walmart tried to get out in front of the story by including a disclosure of possible FCPA problems in its December 2011 FCPA filing, though that disclosure downplayed the seriousness of the issue.) The original New York Times story, along with a follow-up story published in April 2012, netted the two reporters a Pulitzer Prize. Those reports, along with Walmart’s December 2011 disclosure, prompted the Department of Justice Securities & Exchange Commission to begin investigating Walmart for FCPA violations.

That was back in April 2012. It’s now three and a half years later, and there’s still no resolution of the case; the investigation is still ongoing—something that has prompted grumbling in some quarters about both the length and cost of the investigation (see here and here). Why is this taking so long?

This is a question I’ve heard several people raise at various conferences and meetings. I don’t have any good answers, but I thought I’d throw out a few hypotheses: Continue reading →