An Anti-Corruption Ethics and Compliance Programme for ...

1 An Anti-Corruption Ethics and Compliance Programme for Business: A practical Guide United Nations, September 2013. All rights reserved, worldwide. The designations employed and the presentation of material in the present publication do not imply the expression of any opinion whatsoever on the part of the Secretariat of the United Nations concerning the legal status of any country, territory, city or area, or of its authorities, or concerning the delimitation of its frontiers or boundaries. Information on uniform resource locators and links to Internet sites contained in the present publication are provided for the convenience of the reader and are correct at the time of issue.

2 The United Nations takes no responsibility for the continued accuracy of that information or for the content of any external website. This publication has not been formally edited. Publishing production: English, Publishing and Library Section, United Nations Office at Vienna. United Nations Office on Drugs and Crime Vienna An Anti-Corruption Ethics and Compliance Programme for Business: A practical Guide UNITED NATIONS. New York, 2013. iii Foreword Corruption represents a major threat to rule of law and sustainable development the world over.

3 It has a disproportionate, destructive impact on the poor and most vulnerable, but it is also quite simply bad for business. Corruption stifles economic growth, distorts competition and presents serious legal and reputational risks. It drives away investors by acting as a hidden tax or illegal overhead charge, thereby increasing costs for companies, and further down the chain, their customers. Corrupt practices are detrimental to all businesses large and small, multinational and local. Corporate scandals have rocked financial markets and undermined inves- tor confidence.

4 Such incidents also receive enormous attention from the public and the media, and hit the reputations of more than just the particular entity or persons involved. Calls for greater private sector accountability have led many businesses, particularly among the world's largest corporations, to implement principles to guard against corruption, thus protecting their corporate image as well as the interests of their investors, workers and customers. The United Nations Convention against Corruption, the world's strongest and most comprehensive legal instrument in the fight against corruption, addresses action with the private sector.

5 The 167 States that are currently States Parties to the Convention have pledged to take measures to prevent corruption involving the pri- vate sector, enhance accounting and auditing standards and, where appropriate, provide penalties for failure to comply. The Convention further recognizes that States alone cannot fight corruption. Companies clearly have a critical role to play as allies for change. That is why the United Nations Office on Drugs and Crime has developed this practical Guide on the steps companies may take to establish an effective anti.

6 Corruption Ethics and Compliance Programme . iv While actions will vary from company to company, the Guide focuses on basic An Anti-Corruption Ethics and Compliance Programme for Business: A practical Guide common elements businesses should address, with a particular emphasis on the challenges and opportunities for small and medium-sized enterprises. The Guide does not create new standards. Rather, it builds on the Convention and other regional and international initiatives, standards and principles that have been developed over the years to support businesses in their efforts to be good corporate citizens.

7 I encourage business leaders to actively make use of the Guide and strengthen our collective efforts to support fair markets and stamp out the menace of corruption. Yury Fedotov Executive Director United Nations Office on Drugs and Crime v Message from the authors Over the years, a number of regional and international initiatives, standards and principles have been developed to provide guidance for companies on how to fight corruption in their operations by upholding enhanced integrity standards. The pre- sent Guide provides advice on how to put such initiatives, standards and principles into practice.

8 The Guide is primarily based on the United Nations Convention against Corruption (UNCAC) (2005), but is also inspired by the Asia-Pacific Economic Cooperation (APEC) Anti-Corruption Code of Conduct for Business (2007); the International Chamber of Commerce (ICC) Rules on Combating Corruption (2011);1. the Organisation for Economic Co-operation and Development (OECD) Good Practice Guidance on Internal Controls, Ethics and Compliance (2010); the World Economic Forum Partnering Against Corruption Initiative (PACI) Principles for Countering Bribery (2005); Transparency International's (TI) Business Principles for Countering Bribery (2009);2 and the World Bank Group Integrity Compliance Guidelines (2010).

9 The Guide provides practical considerations on the various steps companies may take to prevent corruption in their operations by establishing an effective anti- . corruption Ethics and Compliance This Guide is the product of a project carried out by the Corruption and Economic Crime Branch of UNODC in line with its Thematic Programme entitled Action against Corruption, Economic Fraud and Identity-related Crime (2012-2015). UNODC wishes to thank Mr. Sven Biermann who provided substantive contribu- tions to the drafting of this Guide.

10 UNODC is also grateful to all those who provided comments and feedback. UNODC expresses profound gratitude to the Government of the Russian Federation for its generosity in providing funding for the development of this Guide. 1. 2011 ed. (first published in 1977). 2. First ed. 2003; 2nd ed. 2009 (light revisions). The Business Principles for Countering Bribery, SME. Edition. 3. Throughout the Guide, this term is abbreviated as Anti-Corruption Programme or Programme . vii Contents Foreword iii Message from the authors v Introduction 1.