Protect your organisation with an anti-corruption strategy
In Sweden, we have long seen ourselves as being spared from corruption. But we are frequently reminded that this is not the case. We read about bribery, money laundering scandals, fraud and abuse of power almost on a daily basis. As a result of these revelations, confidence in companies and organisations is lost and they also risk paying large amounts in fines. In the long run, these actions lead to major adverse consequences for society as a whole and also have an impact on the entire sustainability agenda. All businesses therefore need to review their risks and develop a customised anti-corruption strategy.
Prevent, detect and manage corruption violations
We help you in all parts of the work to protect your business from corruption risks. We provide assistance based on sound knowledge of both legislation and international best practice in matters including:
- Advice on bribery legislation and self-regulation (e.g. the Swedish Anti-Corruption Institute (IMM) Code to prevent Corruption in Business) as well as assistance with preliminary investigations in criminal cases and lawsuits regarding corporate fines.
- Risk analyses on the business from the point of view of corruption.
- Evaluation of existing anti-corruption work.
- Establishment and implementation of an anti-corruption programme.
- Investigation of suspected irregularities.
- Establishment of a whistleblowing system and advice on issues relating to whistleblowing.
- Third party due diligence and anti-corruption due diligence for mergers and acquisitions
- Training, courses and seminars on anti-corruption.
What is corruption?
There is no uniform definition of corruption. Nor is it mentioned in Swedish legislation. On the other hand, many organisations base their approach on the definition issued by the international anti-corruption organisation Transparency International. According to that definition, corruption is the abuse of entrusted power for private gain. That means that corruption involves more actions than just bribery. Examples of those other actions include nepotism, favouritism towards private contacts in employment and procurement and misuse of corporate funds.
As a result of the fact that there is no uniform definition, each business must clarify both the concept of corruption and what corrupt behaviour may exist in the organisation. That forms a starting point for the production of a risk analysis and a strategy for dealing with identified risks (an anti-corruption programme).
What are the existing legal requirements?
In Sweden, it is mainly the rules of the Criminal Code that apply. These are contained in Chapter 10 of the Code and, briefly, state as follows:
- A person who is an employee or performing a commission, and receives, accepts a promise of, or requests an undue advantage for the performance of their employment or commission may be guilty of taking of a bribe. (Chapter 10, Section 5a)
- A person who gives, promises or offers an undue advantage to a person who is an employee or performing a commission may be guilty of giving of a bribe. (Chapter 10, Section 5b)
- A person who gives, promises or offers someone an undue advantage or receives, accepts a promise of or requests an undue advantage to influence a decision or measure taken by someone else in the exercise of public authority or public procurement may be guilty of trading in influence. (Chapter 10, Section 5d)
- A business operator who supplies money or other assets to a person representing the business operator in a particular matter and thereby, through gross negligence, promotes giving of a bribe may be guilty of negligent financing of bribery. (Chapter 10, Section 5e)
The offence of breach of trust against a principal (Chapter 10, Section 5) is also a form of corruption offence.
The criminal liability is personal. However, companies can be ordered to pay corporate fines. This can occur if the offence was committed by a person in a leading position or with specific responsibility for supervision or control of the business. In addition, a company may be ordered to pay a corporate fine if the company has not adopted sufficient measures to prevent the crime. An anti-corruption programme is therefore required in order to avoid corporate fines in some cases.
In addition to Swedish legislation, many companies are subject to international bribery legislation. Several international laws have what is referred to as “extraterritorial effect”. That means that the law applies both outside their own country and to foreign companies, under certain conditions. The most important international laws to take into consideration include the US Foreign Corrupt Practices Act (FCPA), the UK Bribery Act and the French Sapin II. These laws also impose requirements on companies to establish anti-corruption programmes in order to escape liability or receive reduced fines (“failure-to-prevent” is punished). French legislation goes the furthest in this regard and requires some companies to establish anti-corruption programmes, with sanctions if no such programmes exist. Sanctions can be imposed even if no corruption violation has been committed.
Self-regulation against corruption
In addition to legal requirements, extensive self-regulation has been developed in order to combat corruption. This includes, specifically, the Anti-Corruption Rules of the International Chamber of Commerce (ICC) and the Swedish Anti-Corruption Institute’s Code to prevent Corruption in Business (the Business Code). These supplement the legal provisions and compliance with them forms a sound basis for the creation of a resilient anti-corruption organisation. There are also industry-specific anti-corruption self-regulations. In Sweden, for example, anti-corruption agreements have been developed in the publicly funded construction and real estate sector, as well as in healthcare, social care and personal assistance. There are also industry-specific self-regulations at international level, e.g. in the maritime sector.
Anti-corruption programmes – more than just an anti-corruption policy
The starting point for a robust anti-corruption programme is the risks existing in the business. An anti-corruption programme therefore always needs to be customised to your own organisation. However, there are a number of components that an anti-corruption programme must contain:
✓ A clear position adopted by the management (tone from the top)
That means clear communication against corruption and also guaranteeing adequate resources and division of responsibility.
✓ Risk analysis
The starting point for the design of the programme are the risks faced by the organisation. The risk analysis therefore forms the basis for the remaining measures.
✓ Policies and guidelines
There must be an anti-corruption policy. This often needs to be supplemented by clear, specific guidelines that address identified risks.
✓ Communication and training
Much of the work to implement an anti-corruption programme consists of training. The view of anti-corruption and ethics also needs to be communicated in the business on an ongoing basis.
✓ Risk-based management of third parties
Intermediaries and other third parties used in the business must be checked on the basis of the risk of corruption (due diligence). Due diligence must also be carried out in corporate transactions on the basis of the risk of corruption.
✓ Reporting channels (whistleblowing)
In addition to the importance of continually capturing signals on irregularities, in accordance with new legislation all businesses with 50 and more employees must implement a whistleblowing system. All reports received must be taken seriously and an assessment must be carried out on whether they will lead to an investigation.
✓ Disciplinary measures and incentives
It is important for there to be consequences in the event of breaches of internal rules. Similarly, there should be incentives to act ethically and in accordance with rules and policies.
✓ Monitoring, supervision and overhaul
The programme needs to be subject to ongoing evaluation and overhaul. It will thus be possible to detect deficiencies and update the programme. Internal control systems are also required.