Latvia has completed the process to become a member of the Organisation for Economic Co-operation and Development (OECD) Convention on Combating Bribery of Foreign Public Officials in International Business Transactions, with official membership to commence as of May 30, 2014.
The OECD Convention requires parties to adopt and enforce domestic laws to prohibit foreign bribery, and has long been considered one of the most important global tools that address global corruption – and for good reason. According to the 2013 Transparency International Progress Report: Assessing Enforcement of the OECD Convention on Combating Foreign Bribery, parties to the Convention account for two-thirds of the world’s exports and approximately 90% of foreign direct investment flows.
Ensuring those countries enforce common legal requirements – and their companies adopt common compliance standards – can help level the playing field for all global business and bring predictability and fairness to important markets. This point was underscored by OECD Secretary –General Angel Gurria in his announcement of Latvia’s accession to the Convention: “Joining the Convention will enable Latvia to play a more active role in global efforts to tackle bribery and corruption.”
In addition to Latvia, the 34 OECD member countries plus Argentina, Brazil, Bulgaria, Colombia, Russia and South Africa are Parties to the Convention.
Going forward, Latvia will undergo periodic, rigorous reviews to assess enforcement of its anti-bribery laws, conducted by the OECD Working Group on Bribery, an inter-governmental expert group. Its first examination will begin in June.
The globalization of anti-corruption makes it more important than ever for companies to have comprehensive anti-corruption compliance programs in place. Internationally accepted frameworks such as the OECD Good Practice Guidance on Internal Controls, Ethics, and Compliance and Transparency International’s Business Principles for Countering Bribery provide guidelines for what an effective anti-corruption program should include:
· Risk Assessment: regular risk assessment particular to industry, geography, business structure, and business partners.
· Policies, Procedures and Records: clear policies, procedures, and financial controls, tailored to risk, properly documented, and communicated throughout the organization and, as appropriate, to business partners
· Compliance Team: a dedicated compliance team with the proper competence, independence, authority and resources, supported by senior management
· Supply Chain Management: regular, risk-based due diligence of business partners, use of appropriate contracts, and post-contract monitoring to ensure compliance
· Training: regular training for all employees and specialized training for employees exposed to higher risk, and as appropriate, business partners, as well as regular, consistent messaging on the importance of compliance
· Reporting Mechanisms: effective whistleblower mechanisms and protection
· Enforcement: vigorous, consistent enforcement to investigate potential violations and sanction wrongdoing
· Monitoring & Corrective Action: regular monitoring/auditing of the anti-corruption program with updating as necessary to fill gaps and meet new risks as they arise
CREATe.org Anti-Corruption Resources
· Anti-Corruption Compliance Guidelines – an overview of key international guidelines
· Guide to Improving Your Anti-Corruption Program – Preview